Detailed research reports covering real estate sector in the GCC
Real Estate Market Commentary - 8 to 14 April 2012
Apr 18, 2012
Kuwait Financial Centre "Markaz"
MENA REAL ESTATE RESEARCH
Research Highlights: A weekly market commentary
Real Estate Market Commentary
08-Apr-12 to 14-Apr-12
Kuwait: Kuwait Finance House in its Q4-11 report highlighted an increase in the sales prices of investment land across locations, with increases ranging from c.2-11%. Furthermore, commercial real estate prices stabilized in Q4-11, with Hawalli posting a moderate increase of 3.2%, and Ahmadi posting a 2.4% increase Q-o-Q. On the rental front, the report outlined stability in average apartment rental rates with increases mainly in rates for high-end units. Occupancy rates remained at high levels of c.90≠95%. Furthermore, the report indicated stability in rentals of commercial properties. UAE: UAE's Minister of Finance reportedly urged to real estate developers in the emirates to slow down residential projects, aimed at balancing the oversupply in the market assisted by, an estimated inrush of expatriates to UAE for jobs in the near future. He particularly pointed out to the low demand to supply ratio (c.20%) in suburban areas, against a healthy ratio of c.90% inside the cities, indicating that; current oversupply in suburban areas was c.80%, while oversupply inside cities was only c.10%. Employment consultant firm Gulf Talent's job market overview, indicated a revival in employment levels in Dubai in 2011, as the share of vacancies advertised on its website shot up to 37% from 31% a year earlier. Gulf Talent also guided for a 5.1% average salary hike for 2012 in the UAE. Gulf Talent's job market overview also outlined a stable trend of Dubai-based professionals traveling to Abu Dhabi for work at 5.4% for both 2010 & 2011. In a separate report, another consultant Antal International noted a 13% Y-o-Y decline in hiring activity in Dubai for Q1-12; but foresees a recovery in employment activity during the rest of 2012. Bahrain: Cluttons reportedly observed a flat trend in the residential rental market in its Q1-12 report, with only areas close to perceived `trouble areas' witnessing a correction and, expected overall rentals to remain largely flat in the recent future. The report also alluded to a downtrend in the residential sales market with many transactions resulting in losses for sellers. On the office front, rentals reportedly edged down compared to Q3-11 and Cluttons expects this downtrend to continue on higher supply side competition, as tenants seek small, fully-fitted office space against larger, unfitted units. Jordan: According to Jordan's Department of Land & Survey, the total number of real estate transactions registered for Q1-12 was 22,414 against 26,816 in Q1-11, representing a decline of 16.4%. Furthermore the total value transacted contracted 39.4% from USD2.4Bn in Q1-11 to USD1.5Bn. MENA: According to JLL, real estate deals in MENA region grew 20.3% Y-o-Y in 2011 to USD166 Bn. This was lesser than the 30.6% Y-o-Y surge in the global property transactions to USD418 Bn. JLL expects the global deal values to be c. USD 400bn in 2012 on absence of large, oneoff deals compared to 2011.
Contents Market Commentary Charts to Note Activity Monitor: Dubai, Kuwait, Riyadh - KSA, Dammam ≠ KSA Markaz Research is available on: Bloomberg - Type "MRKZ" Thomson Research, Reuters Knowledge ReutersRealEstate.com Nooz Zawya Investor ISI Emerging markets
Thomas K. Mathew Senior Research Analyst +965 2224 8000 Extn: 2712 firstname.lastname@example.org Venkat Ramadoss ACA, CFA Assistant Manager +965 2224 8548 email@example.com Bassam N. Al-Othman Executive Vice President +965 2224 8011 firstname.lastname@example.org
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.
Developments sourced from various sources including news portals like Gulfbase, Zawya, Reuters, Bloomberg, Trade Arabia, Business
MENA REAL ESTATE RESEARCH Charts to note:
Chart 1: Kuwait Residential Land Prices ≠ Q4-11
1,000 800 600 800 600
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