Feb 25, 2012
Kuwait Financial Centre "Markaz"
MENA REAL ESTATE RESEARCH
Research Highlights: A weekly market commentary
Real Estate Market Commentary
19-Feb-12 to 25-Feb-12
Abu Dhabi: CBRE reported relatively stable trends in the residential segment during Q4-11 as compared to Q4-10 in terms of rental and price declines, reflecting the existing market view, driven arguably by delivery delays. It reported that decline in rentals were more pronounced in the ,,Mainland which is off the main island of Abu Dhabi due to inadequate transport infrastructure and utilities.
Abu Dhabi residential rental trends Q4-11 Main Island Mainland Q-o-Q % Y-o-Y % Q-o-Q % Y-o-Y % -4 -16 -5 -30
Source: CBRE Abu Dhabi Q4-11 report
Contents Market Commentary Charts to Note Activity Monitor: Dubai, Kuwait, Riyadh - KSA, Dammam KSA Qatar
Markaz Research is available on: Bloomberg - Type "MRKZ" Thomson Research, Reuters Knowledge ReutersRealEstate.com Nooz Zawya Investor ISI Emerging markets
In the office space front, CBRE estimated the total supply at 2.74 Mn Sqm as of 2011 (JLL 2.46 Sqm). Broadly in line with other estimates, CBRE reported Q-o-Q declines up to 3% during Q4-11 and around a 20% Y-o-Y decline. CBRE expects, again alike others, vacancy rates to rise and rentals and prices to experience downside pressures. UAE: MEED reported that construction costs in the UAE are likely to decline by 1.3% Y-o-Y in 2012 compared to the estimates of 24.5% decline during 2010 and 4.6% in 2011. It cited a 52% Y-o-Y fall in the value of construction contracts awarded in 2011, while it forecasted strong project pipeline driven by increased government spending on infrastructure in Abu Dhabi and other investment inflows into Dubais tourism and retail sectors; and expects construction costs to increase 2.9% Y-o-Y in 2013 as a consequence. Qatar: Qatar Statistics Authority reported a 1.2% Y-o-Y CPI growth during Jan-12 and a 5.9% Y-o-Y decline in the housing component of CPI. It also reported flat M-o-M trend in CPI and 0.5% M-o-M decline in the housing component. NAI Qatar reported 1%-3% M-o-M declines in residential rentals, except for two and three bedroom unfurnished apartments. It also reported a slight uptrend in office space rents and flat trends in retail and warehouse rents during the month. Egypt: JLL reported evidence of clarity returning to the market from demand for office and retail space amidst uncertainties. It reported stable prime office rentals throughout 2011 except a c.18% decline during Q1-11; caused by the political developments early during the year. JLL estimated prime space vacancy levels at 35% as of Q4-11 and expected the vacancy to rise and rentals to decline due to forthcoming supply.
Cairo real estate supply (,,000 Sqm) 2011E 2012 E 2013 F Office 711 771 921 Retail 786 1,008 1,323
Source: JLL Cairo Q4-11 market overview
Venkat Ramadoss ACA, CFA Assistant Manager +965 2224 8548 rvenkateshwaran@markaz.com Bassam N. Al-Othman Executive Vice President +965 2224 8011 bothman@markaz.com M.R. Raghu CFA, FRM Head of Research +965 2224 8280 rmandagolathur@markaz.com Kuwait Financial Centre "Markaz" P.O. Box 23444, Safat 13095, Kuwait Tel: +965 2224 8000 Fax: +965 2242 5828 markaz.com
2014 F 972 1,757
2015 F 1,268 2,213
JLL outlined similar trends in retail space reporting a 20-30% Y-o-Y correction of rentals in malls with a GLA greater than 30,000 sqm despite dearth of quality retail space due to demand weakness on economic and security concerns. JLL estimated vacancy levels at 30% in malls with a GLA greater than 90,000 sqm and expects rentals to remain stable in 2012, and experience declines after that due to planned supply.
Developments sourced from various sources including news portals like Gulfbase, Zawya, Reuters, Bloomberg, Trade Arabia, Business 24/7, Arabian Business, The Peninsula, Gulf News, Property wire, Khaleej Times, Saudi Gazette, KUNA etc and also from published reports of real estate brokers and investment research houses.
MENA REAL ESTATE RESEARCH Charts to note:
Chart 1: Abu Dhabi Quarterly change in commercial rentals
Source: Respective Reports, Markaz Analysis
Chart 2: Abu Dhabi Yearly change in commercial rentals
Source: Respective Reports, Markaz Analysis
Chart 3: Qatar Consumer Price Index (CPI) and house rents 2011-12
Source: Qatar Statistics Authority (QSA), Monthly Consumer Price Indices (2011 & 2012)
Kuwait Financial Centre "Markaz"
2
MENA REAL ESTATE RESEARCH
Chart 4: Qatar Monthly change in residential rentals
1%
0%
-1%
-2%
-3% 1BHK 2BHK Fully furnished
Source: NAI Qatar, Markaz analysis
3BHK Un-furnished
Villa
Chart 5: Office Rents in Cairo
Source: Jones Lang LaSalle Cairo Q4-11 market overview
Chart 6: Retail rents in Cairo Malls with GLA more than 30,000 sqm
Source: Jones Lang LaSalle Cairo Q4-11 market overview
Kuwait Financial Centre "Markaz"
3
Villa
Land
Total
No. of Transactions
No. of Transactions
10
15
20
25
30
35
Apartment
Transactions
10
20
30
40
50
60
80
70
Villa Transactions
Land Transactions
Activity Monitor
No. No. No. No. Value Value Value Value
5
W-o-W
-36.1%
-19.4%
103.7% 427.0% 109.1%
37.1% 7.1% 110.1% 92.7%
21.5% -1.3% 0.0% 163.5% 112.5% 0.7% 110.1%
Y-o-Y
No. of transactions
Dubai Real Estate Transactions (2011 & 2012)
No. of transactions Value transacted (AED Mn)
Value transacted (AED Mn)
W01-2011 W02-2011 W03-2011 W04-2011 W05-2011 W06-2011 W07-2011 W08-2011 W09-2011 W10-2011 W11-2011 W12-2011 W13-2011 W14-2011 W15-2011 W16-2011 W17-2011 W18-2011 W19-2011 W20-2011 W21-2011 W22-2011 W23-2011 W24-2011 W25-2011 W26-2011 W27-2011 W28-2011 W29-2011 W30-2011 W31-2011 W32-2011 W33-2011 W34-2011 W36-2011 W37-2011 W38-2011 W39-2011 W40-2011 W41-2011 W42-2011 W43-2011 W44-2011 W45-2011 W46-2011 W47-2011 W48-2011 W49-2011 W50-2011 W51-2011 W52-2011 W01-2012 W02-2012 W03-2012 W04-2012 W05-2012 W06-2012 W07-2012 W08-2012
W01-2011 W02-2011 W03-2011 W04-2011 W05-2011 W06-2011 W07-2011 W08-2011 W09-2011 W10-2011 W11-2011 W12-2011 W13-2011 W14-2011 W15-2011 W16-2011 W17-2011 W18-2011 W19-2011 W20-2011 W21-2011 W22-2011 W23-2011 W24-2011 W25-2011 W26-2011 W27-2011 W28-2011 W29-2011 W30-2011 W31-2011 W32-2011 W33-2011 W34-2011 W36-2011 W37-2011 W38-2011 W39-2011 W40-2011 W41-2011 W42-2011 W43-2011 W44-2011 W45-2011 W46-2011 W47-2011 W48-2011 W49-2011 W50-2011 W51-2011 W52-2011 W01-2012 W02-2012 W03-2012 W04-2012 W05-2012 W06-2012 W07-2012 W08-2012
1,000 900 800 700 600 500 400 300 200 100 0
Kuwait Financial Centre "Markaz"
60 70
Value Transacted (AED Mn)
10
20
30
40
50
0
Value Transacted (AED Mn)
MENA REAL ESTATE RESEARCH
4
No. of Transactions
Apartment Transactions
100
300
400
500
200
600
-
No. of transactions Value transacted (AED Mn)
W01-2011 W02-2011 W03-2011 W04-2011 W05-2011 W06-2011 W07-2011 W08-2011 W09-2011 W10-2011 W11-2011 W12-2011 W13-2011 W14-2011 W15-2011 W16-2011 W17-2011 W18-2011 W19-2011 W20-2011 W21-2011 W22-2011 W23-2011 W24-2011 W25-2011 W26-2011 W27-2011 W28-2011 W29-2011 W30-2011 W31-2011 W32-2011 W33-2011 W34-2011 W36-2011 W37-2011 W38-2011 W39-2011 W40-2011 W41-2011 W42-2011 W43-2011 W44-2011 W45-2011 W46-2011 W47-2011 W48-2011 W49-2011 W50-2011 W51-2011 W52-2011 W01-2012 W02-2012 W03-2012 W04-2012 W05-2012 W06-2012 W07-2012 W08-2012
0
100
300
400
500
200
600
Source: Dubai Land Department Note: 1) The above table/chart represents transactions as per the registration date and not the transaction date 2) Outliers identified are removed for better clarity.
Kuwait Financial Centre "Markaz"
Value Transacted (AED Mn)
MENA REAL ESTATE RESEARCH
5
Total
No. of Transactions
No. of Transactions
100
150
250
300
200
50
0
30
40
50
60
70
Private Residential
Investment
Commercial
10
20
0
Source: MOJ, Kuwait
Source: MOJ, Kuwait
Transactions
No. -29.4% -64.0% -50.0% 41.7%
No.
No.
No.
Value -5.6%
Value
Value
Value -17.2% 66.7%
W-o-W
-37.8%
Investment Property transactions
No. of transactions
Private Residential Property transactions
Kuwait Real Estate Transactions (2011 & 2012)
No. of transactions
Y-o-Y
-33.8%
-26.8%
35.7% 7.1%
69.9%
68.9%
N.A.
N.A.
Value transacted (KWD Mn)
Value transacted (KWD Mn)
W01-2011 W02-2011 W03-2011 W04-2011 W05-2011 W06-2011 W07-2011 W08-2011 W09-2011 W10-2011 W11-2011 W12-2011 W13-2011 W14-2011 W15-2011 W16-2011 W17-2011 W18-2011 W19-2011 W20-2011 W21-2011 W22-2011 W23-2011 W24-2011 W25-2011 W26-2011 W27-2011 W28-2011 W29-2011 W30-2011 W31-2011 W32-2011 W33-2011 W34-2011 W35-2011 W36-2011 W37-2011 W38-2011 W39-2011 W40-2011 W41-2011 W42-2011 W43-2011 W44-2011 W46-2011 W47-2011 W48-2011 W49-2011 W50-2011 W51-2011 W52-2011 W01-2012 W02-2012 W03-2012 W04-2012 W05-2012 W06-2012 W07-2012
W01-2011 W02-2011 W03-2011 W04-2011 W05-2011 W06-2011 W07-2011 W08-2011 W09-2011 W10-2011 W11-2011 W12-2011 W13-2011 W14-2011 W15-2011 W16-2011 W17-2011 W18-2011 W19-2011 W20-2011 W21-2011 W22-2011 W23-2011 W24-2011 W25-2011 W26-2011 W27-2011 W28-2011 W29-2011 W30-2011 W31-2011 W32-2011 W33-2011 W34-2011 W35-2011 W36-2011 W37-2011 W38-2011 W39-2011 W40-2011 W41-2011 W42-2011 W43-2011 W44-2011 W46-2011 W47-2011 W48-2011 W49-2011 W50-2011 W51-2011 W52-2011 W01-2012 W02-2012 W03-2012 W04-2012 W05-2012 W06-2012 W07-2012
0
50 60 70
0
30
40
Kuwait Financial Centre "Markaz"
20 40
Value Transacted (KWD Mn)
10
20
Value Transacted (KWD Mn)
100 60 80
160
180
120
140
MENA REAL ESTATE RESEARCH
6
Total
No. of Transactions
No. of Transactions
100 500
200
300
350
450
150
250
400
1,000
1,500
2,500
3,000
2,000
Source: MOJ
50
0 0
Source: MOJ
Residential
Commercial No. No.
No. -10.2% -37.8%
Value -15.8%
Value
Value 5.8% -14.1%
-9.3%
Riyadh Residential transactions
Riyadh Commercial transactions
Riyadh Real Estate Transactions W-o-W Transactions Y-o-Y
KSA Real Estate Transactions (2011 & 2012)
No. of Transactions No. of Transactions Value Transacted (SAR Mn)
-42.2%
-43.0%
-50.3%
-41.5%
-36.2%
-43.3%
Value Transacted (SAR Mn)
W01-2011 W02-2011 W03-2011 W04-2011 W05-2011 W06-2011 W07-2011 W08-2011 W09-2011 W10-2011 W11-2011 W12-2011 W13-2011 W14-2011 W15-2011 W16-2011 W17-2011 W18-2011 W19-2011 W20-2011 W21-2011 W22-2011 W23-2011 W24-2011 W25-2011 W26-2011 W27-2011 W28-2011 W29-2011 W30-2011 W31-2011 W32-2011 W33-2011 W34-2011 W36-2011 W37-2011 W38-2011 W39-2011 W40-2011 W41-2011 W42-2011 W43-2011 W44-2011 W46-2011 W47-2011 W48-2011 W49-2011 W50-2011 W51-2011 W52-2011 W01-2012 W02-2012 W03-2012 W04-2012 W05-2012 W06-2012 W07-2012 W08-2012 W01-2011 W02-2011 W03-2011 W04-2011 W05-2011 W06-2011 W07-2011 W08-2011 W09-2011 W10-2011 W11-2011 W12-2011 W13-2011 W14-2011 W15-2011 W16-2011 W17-2011 W18-2011 W19-2011 W20-2011 W21-2011 W22-2011 W23-2011 W24-2011 W25-2011 W26-2011 W27-2011 W28-2011 W29-2011 W30-2011 W31-2011 W32-2011 W33-2011 W34-2011 W36-2011 W37-2011 W38-2011 W39-2011 W40-2011 W41-2011 W42-2011 W43-2011 W44-2011 W46-2011 W47-2011 W48-2011 W49-2011 W50-2011 W51-2011 W52-2011 W01-2012 W02-2012 W03-2012 W04-2012 W05-2012 W06-2012 W07-2012 W08-2012
0
500
1,000
1,500
2,000
2,500
0
2,000 2,500 3,000 3,500
500
1,000
1,500
Kuwait Financial Centre "Markaz"
Value Transacted (SAR Mn)
Value Transacted (SAR Mn)
MENA REAL ESTATE RESEARCH
7
Total
Source: MOJ
Source: MOJ
No. of Transactions
No. of Transactions
100
200
300
600
400
500
Residential
0
120
160
180
100
140
Commercial
20
No. No. Value Value 1.2% 29.2% 77.3% 16.9%
40
60
80
0
No. -6.3% -2.3%
Value
Dammam Residential transactions
Dammam Commercial transactions
Dammam Real Estate Transactions Transactions W-o-W Y-o-Y
No. of Transactions
No. of Transactions Value Transacted (SAR Mn)
-7.6%
8.1%
-12.8%
293.3% 87.3%
19.0%
Value Transacted (SAR Mn)
W01-2011 W02-2011 W03-2011 W04-2011 W05-2011 W06-2011 W07-2011 W08-2011 W09-2011 W10-2011 W11-2011 W12-2011 W13-2011 W14-2011 W15-2011 W16-2011 W17-2011 W18-2011 W19-2011 W20-2011 W21-2011 W22-2011 W23-2011 W24-2011 W25-2011 W26-2011 W27-2011 W28-2011 W29-2011 W30-2011 W31-2011 W32-2011 W33-2011 W34-2011 W36-2011 W37-2011 W38-2011 W39-2011 W40-2011 W41-2011 W42-2011 W43-2011 W44-2011 W46-2011 W47-2011 W48-2011 W49-2011 W50-2011 W51-2011 W52-2011 W01-2012 W02-2012 W03-2012 W04-2012 W05-2012 W06-2012 W07-2012 W08-2012
W01-2011 W02-2011 W03-2011 W04-2011 W05-2011 W06-2011 W07-2011 W08-2011 W09-2011 W10-2011 W11-2011 W12-2011 W13-2011 W14-2011 W15-2011 W16-2011 W17-2011 W18-2011 W19-2011 W20-2011 W21-2011 W22-2011 W23-2011 W24-2011 W25-2011 W26-2011 W27-2011 W28-2011 W29-2011 W30-2011 W31-2011 W32-2011 W33-2011 W34-2011 W36-2011 W37-2011 W38-2011 W39-2011 W40-2011 W41-2011 W42-2011 W43-2011 W44-2011 W46-2011 W47-2011 W48-2011 W49-2011 W50-2011 W51-2011 W52-2011 W01-2012 W02-2012 W03-2012 W04-2012 W05-2012 W06-2012 W07-2012 W08-2012
0
600 800 1,200
0
200
400
200
400
600
800
1,000
1,000
1,600
1,800
1,200
1,400
Kuwait Financial Centre "Markaz"
Value Transacted (SAR Mn)
Value Transacted (SAR Mn)
MENA REAL ESTATE RESEARCH
8
No. of Transactions
150
200
250
300
350
100
400
50
0
Source: MOJ
Qatar Real Estate Transactions (2011 & 2012)
No. of transactions Value transacted (QAR Mn)
W01-2011 W02-2011 W03-2011 W04-2011 W05-2011 W08-2011 W09-2011 W10-2011 W11-2011 W12-2011 W13-2011 W14-2011 W15-2011 W16-2011 W17-2011 W18-2011 W19-2011 W20-2011 W22-2011 W23-2011 W24-2011 W25-2011 W28-2011 W29-2011 W31-2011 W32-2011 W33-2011 W34-2011 W36-2011 W38-2011 W40-2011 W41-2011 W42-2011 W43-2011 W44-2011 W47-2011 W48-2011 W49-2011 W51-2011 W52-2011 W01-2012 W02-2012 W03-2012 W04-2012 W05-2012 W06-2012 W07-2012 W08-2012
0
500
1,500
2,000
2,500
3,000
3,500
1,000
4,000
Kuwait Financial Centre "Markaz"
Value Transacted (QAR Mn)
MENA REAL ESTATE RESEARCH
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MENA REAL ESTATE RESEARCH
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