How to Secure Your Real Estate Assets in the UAE?

The UAE continues to welcome real estate investments from residents and global investors. Naturally, the next stage after acquiring the property is to secure it. When we talk about securing the property, we refer to protecting it in situations that could risk it being claimed. For example, if you are an entrepreneur, and your business is sued, there should be some mechanism that forms a wall to protect the personal assets you own. The aspect of safeguarding assets can be viewed from a different angle as well. Imagine this scenario. You own a real estate asset, and you have relatives trying to claim it as their own. But you wish that only your spouse inherits it after you pass away. How can you ensure this in the most seamless way? Read on to know the different ways you can secure your real estate property in the UAE.

Wills

A Will is a legal document through which you can spell out who inherits the real estate property that you own. You can clearly mention how you would like to bequeath your real estate assets. Whether you plan to give it to one or multiple individuals is purely your call, and you can state this through a Will. Once written, a Will in the UAE can be registered with the relevant authority. The Will is triggered once you pass away and is key to ensuring that the beneficiaries inherit the assets the way you wished. A probate process is conducted to determine the beneficiaries of your assets. A Will if left behind, largely simplifies this process and ensures your property goes to the individuals whom you chose and the way you wanted to.

In the UAE, two of the most common jurisdictions where Wills can be registered are the DIFC Wills Service Centre (WSC) and the Abu Dhabi Judicial Department (ADJD). While a DIFC Will can only be registered by non-Muslims, ADJD Will registrations are open for both Muslims and non-Muslims in the UAE.

DIFC courts are renowned for adopting the common law principles and legislation adopted in other leading common law jurisdictions. Another key benefit of DIFC Wills is that the probate proceedings are conducted in English. Besides, it is fairly simple to write and register a DIFC Will as it can be written and registered through a completely remote process.

The other option for registering a UAE Will is through ADJD. Unlike a DIFC Will, an ADJD Will is required to be translated into Arabic. Also, it can be registered by Muslims as well. Like DIFC Wills, ADJD Wills too can be prepared and registered remotely.

Holding Company

A holding company in the UAE is a great way for entrepreneurs to manage and protect real estate assets and conduct business at the same time. As the name suggests, this type of company is primarily set up with the purpose of holding assets. These assets can be real estate property, other companies, intellectual property, cash assets, stocks, etc.

Essentially, a holding company does not conduct any business operations itself. It does not manufacture products nor does it provide any services. Rather, it can own subsidiary companies that can conduct business.

Interestingly, a holding company is not responsible for the debts of its subsidiary companies. This is what makes it such a good option for entrepreneurs to secure their real estate assets. If one of the subsidiaries owned by your holding company goes bankrupt, its creditors can’t go after the holding company or the assets it owns.

Foundations

Foundations can be considered as an advanced form of asset protection mechanism. A foundation is a legal entity that can own assets. These assets can be anything like cash, company shares, investment bonds, and so on. It is necessary to note that the assets held within the foundation are no longer a part of the personal property of the foundation’s founder. This means that the property held by the foundation cannot be claimed in cases where the founder is sued or is in debt. One must bear in mind that real estate assets in the UAE cannot be owned directly by the foundation as of the date of writing. A foundation can own a company that can in turn own real estate assets in the UAE.

Through a foundation in the UAE, you can consolidate different types of assets that you own in a single place. Also, foundations provide an excellent mechanism for inheritance planning. The assets are passed on to the beneficiaries of the foundation without the need for a probate process.

Whether it is writing a Will, setting up a holding company, or establishing a foundation, it is necessary to acquire professional assistance. Legal Inz offers end-to-end assistance with all of the above ways to secure your real estate property in the UAE.