YOUR COMPLETE GUIDE TO RENTING IN ABU DHABI

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1 GLOBAL HERITAGE PROPERTIES & BUSINESS M A N A G E M E N T YOUR COMPLETE GUIDE TO RENTING IN ABU DHABI leasing@globalheritageproperties.com

2 This Guidance* is correct as at 1 March Here is your complete guide, step by step, to renting a property in Abu Dhabi. Never be confused again. We ve kept it chronological so please click on the section most appropriate to you: 1. When to Start Looking 2. What to Have ready to Start Looking 3. What to Have Ready to Rent 4. How to Pick Your Guide (Broker/Agent) 5. How to Conduct Your Search 6. The Places You Will See 7. The Negotiation 8. The Offer and Acceptance Process 9. What You Will Need to Pay 10. Before You Move In 11. The Handover 12. Internet, Phone, Gas and Chilled Water/Central Cooling Exhibit A - Connecting your ADDC (water and electricity) We have used the word agent below as a shortened from of the British term Estate Agents, which is a real estate broker, property agent, lettings agent and all the other thousand things it is called around the world. *This Guidance is as accurate as we can make it but Abu Dhabi is an unpredictable place, rules change and some landlords do things differently.

3 1. When to Start Looking 2. What to Have Ready to Start Looking The best time to start looking will be a month to three weeks before you want to move. Any earlier than this and what you ve seen may no-longer be available. Landlords will often only allow you to reserve a property two weeks before your tenancy start date, longer than that is very unusual especially if the unit is in high demand (unless you offer to pay more). Some of the Sheikh s Offices will only allow you to reserve a unit 10 days before your start date so don t start looking too early or you ll have to do it all over again closer to the time. Property in Abu Dhabi moves very quickly, so be prepared to jump when you find something you like. Visa If you re new to the country then you should realize that you can t get a Tawtheeq contract (needed to connect your water and electricity) without a visa. Property comes and goes so quickly here in Abu Dhabi you should really either have your visa already, before you start looking, or at least be at an advanced stage with it before you begin your search. An idea of what you want is always useful. Villa, apartment, close to work or close to school, compound or stand alone, balcony, gym, pool? There are a lot of things you would like but take a look at your budget and think about what you need. Bedrooms is something people always overdo rather than having a spare bedroom for family when they come you can save a fortune on rent by having one bedroom less and just putting them up in a hotel instead. Time is also a pre-requisite. Most rental property has no electricity (it is often disconnected when vacated) so viewing at night is an issue, also lots of places are closed on the weekend. Discuss with your agent when is the best time to view your chosen properties. A budget. How much are you going to spend? Almost all landlords require one year s rent up front in either one or two cheques (the second Cheque will be post-dated for 6 months time). On occasion you can get three cheques or more but this is rare. Your housing allowance from your company will often dictate how much you want to spend but it doesn t have to. Find out from your HR department how much your housing allowance is, what happens if you don t spend all of it and, if you find somewhere great that is over your allowance, if you can add the extra amount yourself. The UAE is almost unique as effectively people s companies dictate what kind of accommodation they should be living in in most of the rest of the world companies give their employees cash in their salaries and they can spend it on anything from a studio to a mansion, as they see fit. Please note that it is illegal in Abu Dhabi to combine your housing allowance with that of your husband/wife. A couple can only claim one housing allowance. Talk to your companies and in some circumstances they might agree to put your housing allowance as part of your salary (thus one of you gets cash which they can put towards the rent and the other uses their housing allowance). Please also check out What to have Ready to Rent below to be fully prepared to move on the property of your dreams. House-sharing (the law) - The Tenant may not assign or sub-rent the Property in whole or in part without written permission of the Landlord (Art 17 Tenancy Law). If your name is on the head lease and other tenants are paying you rent then you are technically subletting the property and should obtain the Landlord s permission. House-sharing is governed by Federal law No 1 of Under that law the municipality has stated that up to three unrelated people may occupy each room in an apartment or villa, however no more than a total of six unrelated people may occupy a villa. Only one family unit may occupy an apartment or villa (not multiple families). Unrelated males and females may not live together.

4 3. What to Have Ready to Rent The most desirable property in Abu Dhabi goes extremely fast so you need to be able to move quickly before it is gone. Be prepared. Before you can rent a property you will need: 1. To have spoken to your HR department This is a vital step but very few people talk to their HR departments to see: I. If the tenancy contract will be in your name or your company s name; II. What your company will pay for (will they pay your deposit, agent s commission, any other fees a landlord might impose (such as insurance, contract fee etc); III. Will your company give you the money and expect you to write the cheques or will they issue the cheques themselves; IV. How long it will take your company to issue the cheques?when you reserve a property it will be held usually for three days before being released again and in that time you need to get a deposit to them if your company takes longer than three days to issue cheques then you might have to write the cheques yourself and get paid back (at the very least the landlord needs to be notified at the outset of any potential delay). Find this out. V. What will your company require from the landlord to issue cheques in their name (for example some companies require landlords to be registered as vendors, if this is the case then this process needs to be started quickly as it will hold payment up). 2. A bank account something people always overlook but if you re paying the rent/deposit cheques for your own new home then you need this ready. Request a cheque book when you open an account as these often don t come as standard. If your company is writing all the cheques then this is not an issue. 4. How to Pick Your Guide (Broker/ Agent) There are those who have the time and knowledge to find their own place to live in but for most of us we need an expert. If you ve been here any length of time you will have heard about how terrible the Brokers/Agents are, and many of them are. Luckily for you there is a great way round the bad ones. Abu Dhabi is not like any other market, here in the Capital all the good agents have access to pretty much all the property that there is for rent (landlords here basically deal with everyone they can to get their property rented). This means you don t have to trawl the internet for property you like and call the agent who is advertising because the chances are that all the agents have it. So ask your friends do some research get a recommendation for a good agent. We here at Crompton Partners strive to be the best but there are other good agents out there as well. Talk to them on the phone (make sure they pick up or at least call you back quickly). Get a feel for them, do they understand what you re looking for and can they help you feel comfortable with them. 5. How to Conduct Your Search So now you have an agent, you need to explain to them in as much detail as you can what you re looking for so they can narrow down your search. Abu Dhabi is a big place and if you don t do this you could end up spending weeks looking. Also make sure that your agent has understood what you re after. If they take you to something that isn t right you need to tell them, honestly and frankly. If they keep taking you to unsuitable places change them. If you find out you don t like your agent then change them. Life is too short and there are too many agents to use one you don t like or you don t think understands your requirements or the market. Try and compress your search into as few days as possible. You want to be able to see everything but make sure what you saw first hasn t been snapped up. 3. A visa to sign the Tawtheeq Contract (to connect your water and electricity) you need a visa. 4. Emirates ID you ll need this or the receipt showing it has been applied for to connect your water and Electricity through ADDC.

5 6. The Places You Will See Landlords in Abu Dhabi point blank refuse to start maintenance / cleaning until they have a new tenant signed and sealed, so you are likely to see a fair few dirty places on your travels. Pets In lots of towers and compounds you will not be allowed pets, be allowed cats only, small dogs or you may be required to send a picture to the management to get permission for your dog! Make sure you tell your agent if you have a pet. Parking Most of the newer units will come with parking (though usually only one space some three/four beds will have two), otherwise you will need to get on-street parking. This is done through a company called Mawaqif who issue Residents Parking permits (800 AED for the first permit 1200 AED for the second permit, per year). Central Cooling/Chilled Water Some of the newer apartments and villas have central cooling also known as chilled water. This is water chilled at a central point and piped into the unit to cool the air for the a/c units. This generally does not cost much more than the normal a/c which is cooled by electricity and which shows up on your electricity bill. Central Cooling/Chilled Water is billed separately. Maintenance Contracts Individual owners of villas may have a maintenance contract in place with a reputable company. Make sure you see this. A lot of local owners will have their own maintenance teams employed by their companies but make sure this is the case first. Make sure you confirm who to call if something goes wrong. 7. The Negotiation So you have found your new home, the perfect place and you have all the things you need in place to make your offer so instruct your agent to make the offer. The Price Your agent should be able to offer you guidance on how much property of that type is in demand if you d like to offer below the asking price, but note big discounts are very rare in Abu Dhabi. Property owners and managers in the city are very experienced, know the market value of their product and a 5% reduction in the price would be a very good result. Don t expect large reductions and don t make an insulting offer if you do the landlord may refuse to rent to you out of principal even if you then offer the asking rate. Also note that for properties in high demand a low offer will be rejected and by the time your counter comes in the unit may have been rented. The Start Date Your tenancy start date is very important. If you can cut this down the landlord might negotiate on rent a little, but too short and he won t have time to do the maintenance and repaint. Note we recommend that you start your contract at least one day before you have to move out of your current hotel/house/have your furniture delivered. It the timeline slips a day you don t want to be left on the streets with a van-load of furniture. Cheques Most landlords will require your full year s rent in one or two cheques. On occasion you might get three cheques but any more is rare. Landlords may offer a small discount for paying in one cheque.

6 8. The Offer and Acceptance Process To make the offer you ll need a passport copy at a minimum and some managers will ask for a copy of your visa and Emirates ID (see What to have Ready to Rent if this isn t ready yet). You ll also need to tell the landlord your tenancy start date, offer price and in whose name the contract will be (your name or that of your company). Acceptance and the Offer Letter - You will then get an Offer Letter from the landlord (some landlords do not give offer letters but the bigger managers do). This letter sets out the amount you ve offered to pay in rent, the amounts payable (deposit etc) and reserves the property for you for usually three working days (this can be more). During that time you will need to put down the deposit to reserve the property. If you don t get the deposit in on time the unit will be released back to the market. The Tenancy Agreement - Once you have put down your deposit the landlord will prepare the tenancy agreement for you (unless you work for a government company such as ADIA or ADNOC who have their own contracts). All agreements are for one year. Do not expect to get a signed copy from the landlord, they will almost never sign until you have signed first. You (or your company depending on whose name it will be in) will need to sign two copies of this and return one to the landlord with the cheques. Sometimes landlords (such as ADCP) will not even generate the contract until they have the cheques in this instance ask for a blank copy of the contract so you know what you will be signing. Some landlords will not even sign the tenancy contract until the first cheque has cleared this can be unconscionable to a lot of people but it is not uncommon. Negotiating the Terms of the Tenancy Agreement Landlords in Abu Dhabi tend to be very old fashioned and not sophisticated in a legal manner. A lot is left on trust. They tend to be very unwilling to negotiate the terms of any agreement (indeed many are marked non-negotiable ). This reluctance by landlords is generally based on not wanting to tamper with legal documents they do not fully understand an alternative route if there is a change required to a tenancy agreement would be a Side Letter agreed by the parties which set out the amendment. Crompton Partners has an in-house lawyer who can assist with this. Tawtheeq Agreement Once you have paid your cheques the landlord will generate a Tawtheeq Agreement (they will not do this before the cheques are paid) this is the official Municipality contract which will register your tenancy with the Abu Dhabi Municipality. It is also required to transfer the Water and Electricity into your name, to sponsor your family s visas and a lot of schools request it as well. ADDC Clearance Water and electricity is usually connected once the Tawtheeq contract is generated however you might need an ADDC clearance for your unit if your unit is not managed by a property manager or you do not have your EID yet. You will need to take this to an ADDC office to transfer the Water and Electricity into your name (and turn it back on if it is off). This clearance shows that the past bills have been paid. Note - You need an ADDC account if you want to get a visa for your family here. Make sure the property you re renting is Tawtheeq registered and you can get connected.

7 9. What You Will Need to Pay Deposit The usual practice is 5% of the total rent. This firstly acts as a reservation deposit to secure the unit so that if you back out of the deal then you forfeit this amount. Upon payment of your rent cheques this is usually converted into a security deposit that the landlord will use to cover any damages when you leave or if you fail to pay your water and electricity bills etc. Rent Most landlords want this in one or two cheques up front - the second cheque will need to be written and postdated. Sometimes you can get a better bargaining position if you agree to rent for two or more years (you may want to do this to lock in a certain price) if you do this you ll need to provide all your cheques up front for the whole period (if you do this make sure you have a break clause written into the agreement if your circumstances change i.e. you need to leave Abu Dhabi. Crompton Partners has an in-house lawyer who can assist with this.). Tenancy Assistance Fee A source of much debate, all agents will charge you 5% of the first years rent of the property as a Tenancy Assistance Fee for helping you in your search. There is a slight caveat to this, some may charge a minimum fee which allows them to rent very low value units and still make a profit, but they need to tell you if this applies before showing you any units. Crompton Partners does not do this. Newcomers to the city may not know that most large landlords and managers will also charge you 5% of the first years rent if you go direct to them yourself (but they will be much less helpful than a good agent and only show you/point you towards their own units). Some of the bigger managers who charge you 5% if you go direct are Aldar, Khidmah, TDIC, FGP (First Gulf Property), and many others. If you use an agent these companies split their commission 2.5% to 2.5% with them, so you end up paying exactly the same amount if you use an agent or not, however if you use an agent you don t have to do all the leg-work yourself. What Agents should not charge you more than 5% in total. This is not market standard and if they re asking you to pay for example 5% to them on top of the 2.5% to a property manager then they need to make this clear upfront (it is not illegal but is not market practice). Other Fees Some property managers will charge you 1) Booking fees to secure the unit, 2) contract fees for drawing up the contract, 3) insurance fee for insurance on the unit 4) Tawtheeq registration fees 5) other fees make sure you get a list up front.

8 10. Before you Move in So your move-in date is set, the contract is signed and your cheques are paid what can you expect during this time. Snagging list Get your agent to go around the property with you and the landlord s representative and make a list of items that need to be fixed. Make sure in particular that you check the a/c and the water, if the water and electricity are on. If you can you should check in on the work a few days before your tenancy start date to make sure the items have been fixed or are in progress. Cleaning and Pest Control The landlord is under no obligation to clean or pest control your property over and above what it required to make it habitable. Most landlords will clean and re-paint, though their view of what constitutes clean may vary from yours. Very few landlords will conduct pest control as a matter of routine but you can ask. The water and electricity will need to be connected before the villa is cleaned (see ADDC Connection below). Worth noting that Khidmah/Aldar are now saying they won t clean your new home ask your agent for a reputable and cheap cleaning company. The Law The Landlord shall hand over the Property in a suitable condition to fulfill the utility for which it has been prepared (in most cases this is your habitation) (Art 5 of the Tenancy Law). If the Property is handed over to the Tenant in a such bad condition that it does not fulfill the utility for which it has been prepared or such utility falls significantly, the tenant may ask the Rent Committee to rescind the Tenancy Agreement or refund or reduce the rental charge to the extent of the fall in utility as appropriate (Art 6 of the Tenancy Law). Private Pools If you re lucky enough to have a private pool make sure the landlord fills it up and checks it for leaks before you move in. It is unlikely the landlord will clean and maintain your pool once you are in the property you will probably need to hire a third party. The Landlord should probably maintain the pool pump though. ADDC Connection (Water and Electricity) - If your unit doesn t have the water and electricity turned on already then it should come on if activated by the Tawtheeq system or you will need to visit your local ADDC office before the cleaning takes place (as they can t clean with no electricity) and get it connected. If your water and electricity is already on then you will just need to transfer it into your name once you move in to make sure the bills come to you (although some landlords make you do it before the tenancy start date make sure your agents asks). If it has been left on then it is likely that there will be an amount to pay left over from the time the unit was vacant you will need to pay this to ADDC to get a clearance certificate. It will take 2/3 days for them to issue you this clearance certificate (stating that they have taken a meter reading and all outstanding amounts have been paid). Once that clearance certificate has been issued you ll need to go in again and transfer the bills to your name. Water and electricity can t be transferred into your name until the account has been paid off and is at zero. See Exhibit A for more about the process. The Law The Tenant shall pay for the consumption of water, electricity and telephone for the property, any damages he may cause to the leasehold and any other fees he is legally required to pay as of the date he takes over the leasehold till the date of surrender to the Lessor unless otherwise agreed (Art 15 of the Tenancy Law).

9 11. Handover 12. Internet, Phone, Gas and Chilled Water/Central Cooling Your tenancy start date is upon you. You ve left an extra day in your old apartment/villa/hotel in case of slippage but the handover has been arranged. Go to the handover with your agent to meet the landlord and sign any final documents, check the snag list to make sure everything is done and accept the keys for your unit. If you re getting a furniture delivery to a security controlled villa/apartment make sure you ve filled out the right paperwork so that security will let the truck in. Other Documents You may have to sign other documents at this stage such as community rules, acceptance of the unit, pet rules, keys receipt etc. Phone and Internet The main internet and phone provider is Etisalat. Just call them up once you ve moved in they will come round to connect you. You will need your plot and sector number of your new home so that they can find it (it is on your Tawtheeq). Gas Gas comes in two forms in Abu Dhabi, bottled or mainline. If you have mainline gas you will need to register with the gas provider (such as Dimarco). Ask the property manager or security guard who this is, though your agent should be able to help. They will want a deposit and will bill you for your usage. If you don t have central gas you will need bottled gas. If you are on a compound then ask the manager/ security when the gas truck comes and how to make sure you get a delivery. If you have a stand-alone villa then you ll need to go to an ADNOC station and pick up a bottle of gas (the ADNOC on the corner of Muroor and 31st Street (new Dhafeer St by the Holiday Inn) does them). Make sure you get a regulator cap with it. This then sits outside your villa and you connect it by rubber tubing to the stove. Chilled Water/Central Cooling This has been mentioned above. You will be billed separately for this and will need to put down a deposit for it.

10 Exhibit A - Connecting Your ADDC (water and electricity) It should be connected automatically once the Tawtheeq is generated but if you are leasing from a private owner or you don t yet have your Emirates ID you will need to connect this before you move in so that your home can be cleaned and repainted (electricity is needed for this). To connect your ADDC and/or transfer it into your name you will need to bring with you: 1) The clearance certificate this is mentioned in the main article and needs to be obtained from your landlord; 2) Your Emirates ID and a copy you must bring your original Emirates ID and a copy of it. If you only have a copy you will need to take the original when you get it; 3) A passport and visa copy photocopies of your passport page and visa page; 4) Copy of your Tawtheeq Agreement A photocopy of your Tawtheeq Agreement fully signed; 5) A copy of your tenancy agreement fully signed; 6) The ADDC form filled out and signed by the tenant (you can get these from any ADDC office); and If the utilities are to be transferred into the name of your company you will also, in addition to the above, need: 1) Emirates ID Copy of the authorized signatory and a copy of that authorized signatory s power of attorney; 2) A copy of the company trade license; 3) Letter of authorization from your company stating that you are the occupier and that the unit will be used for residential purposes only; and 4) The ADDC form will need to be signed by the company. If the clearance is up-to-date and there is no outstanding amount to be paid then the transfer/ connection will be made immediately. If another clearance is required you will need to pay the outstanding amount (and claim it back from the landlord) and request a new clearance which will take 2-3 days. ADDC connection is not an exact science the documents required change all the time and some desks/people are more lenient/stringent than others.