Construction & Real Estate

Qatar: Capitalizing on property power

Qatar's real estate sector is on course to post a strong performance this year, having had by its own standards a slow 2009, though by any other measure the industry rode out the global economic downturn with ease. Qatar's GDP is projected to expand at a rate of 16 per cent this year, one of the highest anywhere in the world. Coming on top of 9 per cent growth in 2009, according to figures recently released by the central bank, it is easy to see why there is a sense of optimism surrounding the country's economy. There are estimates that the Qatari real estate sector will grow by around 7 per cent in 2010, mainly as a result of existing and new developments. Though this rate of growth is below the projected GDP expansion, it will still represent a solid performance in a sector that has seen steep downturns across the region. A recent study conducted by the market research firm Dun & Bradstreet indicated that business sentiment in Qatar was on the rise, with the improved mood likely to have an impact on the property market. Significantly, well over one-third of all respondents to Dun & Bradstreet's "Business Optimism Index" survey - released in mid-April - said they expected borrowing conditions to improve in 2010, with 32 per cent saying they were considering expanding their operations. Overall, the study showed an across-the-board improvement in confidence for sales volumes, prices, employment levels and new orders for the second quarter, all of which bode well for the real estate sector. According to Michel Gebrael, the project manager of Project Qatar 2010, real estate is set to rebound from any fall in activity it experienced over the past two years. (Source: OBG)

Qatar's Dohaland awards consortium US$429m contract

Qatari developer Dohaland has awarded a QAR1.56 billion contract to a consortium led by South Korea's Hyundai Engineering and Construction Co., Dohaland said. The contract is part of the first phase of Dohaland's US$5.5 billion, 35-hectare Musheireb project, which will include hotels and retail, residential and government buildings, the company said in a statement. The project will be completed in five phases, with the first phase due to be finished by 2012 and the last by 2016, the company said. The contract is the final in a total of QAR2.2 billion worth of contracts awarded for the construction of Phase 1A of the project, which will include the construction of a national archive, the company said.

Dubai, Abu Dhabi office rents seen falling further

Office rents in Dubai and Abu Dhabi are forecast to fall further in 2010, bucking a rebound that is expected in a majority of markets around the world, Knight Frank said. The property company's Global Report 2010 said the UAE cities were among only a quarter of cities surveyed that saw further rental declines this year. About 75 per cent of cities will either hold firm or see office rents increase, the report added. Abu Dhabi and Dubai currently command the sixth and seventh highest office rents in the world, with Tokyo top of the list. Singapore saw declines in 2009 of more than 50 per cent while Dubai rates fell by 37 per cent and Abu Dhabi rents dropped by 6.7 per cent, Knight Frank said. In March, CB Richard Ellis said office rents in the Dubai International Financial Centre (DIFC) were now the second highest across the Europe, Middle East and African region after being less impacted by the global real estate slump. Its research showed that prime office rents in DIFC in the final quarter of 2009 averaged €819 per sq m per annum (US$1,121), second only to London’s West End (€972).

Kingdom spends SAR20.9bn, mostly on infrastructure

Saudi Arabia awarded development contracts worth SAR20.9 billion (US$5.6 billion) in the first quarter of this year as the Middle East’s largest economy pursues a five-year infrastructure program. The world’s top oil exporter has like other nations boosted spending on infrastructure, health care and education to underpin economic growth, and has warned against early withdrawal of stimulus packages. Saudi Arabia, a member of the G20, plans to spend more than US$400 billion until 2013 for projects such as roads, hospitals and other infrastructure to serve its mainly young population of 18 million people. The Saudi Press Agency gave no comparison but in May last year Finance Minister Ibrahim Al-Assaf put the value of contracts in the first quarter of 2009 at SAR40.6 billion. "The government is seeing clear signs of a recovery so it could be that spending is less spread over the full year more evenly," said John Sfakianakis, chief economist at Banque Saudi Fransi in Riyadh.

Qatar to pour millions in Cyprus property

Qatar and Cyprus signed an agreement to build a multimillion-dollar luxury hotel, office and residential complex in the commercial center of the island's capital. Qatar's Emir Sheik Hamad bin Khalifa Al-Thani and Cyprus President Dimitris Christofias signed the deal to establish a joint venture in which the two countries will hold an equal stake in the 55,000 square-meter (592,020 square foot) complex that will also include retail shopping and residential quarters. Construction crews are expected to break ground for the first phase of the complex -- a 5-star hotel -- by the end of the year, said Mohammed Bin Ali Al Hedfa, Chief Executive Officer of Qatari Diar, Qatar's real estate investment company. The Qatari official put the hotel's estimated cost at over US$150 million (€111.7m) and it will be completed within 30 months once construction begins. Officials did not disclose the overall cost of the complex. Al Hedfa said oil-rich Qatar opted to invest in Cyprus because the island was left relatively unscathed from the global economic crisis. Cyprus Finance Minister Charilaos Stavrakis said the government would contribute the land on which the complex will be built. An international real estate appraiser will calculate the land’s value. The two countries also signed an agreement on forging closer air transport links.

Kuwaiti developer launches housing project on UAE island

Kuwait’s National Real Estate Company (NREC) has announced a four-tower residential project, worth AED1.2 billion (about US$326m), to be developed on Al Reem Island. The waterfront Carina Views towers have been specifically designed to meet the needs of the middle-income professionals, the company said. NREC is a leading regional real estate investment and development company that owns and manages properties and assets across Kuwait, the Middle East and North Africa. Carina Views is NREC’s flagship development project in Abu Dhabi. Khaleel Al-Abdullah, chief executive officer at NREC, said: “Even with the economic crisis, accommodation requirements still need to be addressed in Abu Dhabi. We decided to enter the market and target mid-income professionals to fill a gap that was very much there. We are confident Carina Views is the first of many UAE projects we are embarking on. The 684 Carina Views units are priced reasonably, and offer well-designed spacious housing. Standing at 22 storeys each, the four residential towers are strategically located at the entry to Reem Island. It provides buyers with a variety of units to choose from, including one, two and three bedroom apartments, two and three bedroom duplex penthouse apartments and eight exclusive water villas.

Kingdom Holding sells Fairmont stake to Qatar

Prince Alwaleed bin Talal’s investment company strikes US$847 million deal with Qatari Diar. Kingdom Holding, which is owned by Saudi billionaire Prince Alwaleed bin Talal, has agreed to sell a stake in Canadian hotels chain Fairmont Raffles Holdings International to Qatari Diar for US$847 million, Bloomberg reported. Kingdom’s stake in Fairmont will drop to 35 per cent after the transaction, the company said in a statement to the Saudi bourse. Qatari Diar – which is owned by the country’s sovereign wealth fund – and Voyager Partners will hold 40 per cent of Fairmont Raffles following the deal.