NEWS BRIEF 28 - Asteco

DUBAI | ABU DHABI | AL AIN | SHARJAH | JORDAN

© Asteco Property Management, 2017 asteco.com | astecoreports.com IN THE MIDDLE EAST FOR 30 YEARS

ASSET MANAGEMENT SALES LEASING

VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION

RESEARCH DEPARTMENT

NEWS BRIEF 28

SUNDAY, 09 JULY 2017


© Asteco Property Management, 2017 asteco.com | astecoreports.com

IN THE MIDDLE EAST FOR 30 YEARS



REAL ESTATE NEWS UAE / GCC

FIXED-TERM INVESTMENT PLANS ARE FAILING UAE CUSTOMERS, SAYS FRIENDS

PROVIDENT

ARABTEC WINS DH353M UAE PAVILION CONTRACT FOR EXPO 2020

ECONOMIC SLOWDOWN LIKELY TO HURT QATAR’S BANKING SECTOR ASSET QUALITY

SOLID FUNDAMENTALS SUPPORT UAE’S CREDIT STRENGTH: MOODY’S

UAE PMI DATA POINTS TO SOLID GROWTH IN Q2

QATARI PROPERTY INVESTORS KEEN TO OFFLOAD ASSETS IN UAE

SAUDI-OWNED PARISIAN HOTEL REOPENS AFTER MULTI-MILLION MAKEOVER

GENERATION START-UP: PROPERTYFINDER CHIEF A PIONEER OF ONLINE REAL ESTATE

UAE SHINES AS SUSTAINABLE ENERGY PATHBREAKER

DUBAI

DUBAI REMAINS RELATIVELY STRONGER THAN ABU DHABI MARKET

DUBAI PROPERTY MARKET DIRECTION DEPENDS ON SUPPLY, SAYS JLL

DUBAI RESIDENTIAL SECTOR STABILISING

DUBAI HOTEL OWNERS LOOK FOR NEW WAYS OF EARNING IN CROWDED MARKET

BEWARE OF SPECIAL OFFERS ON OFF-PLAN PURCHASES

DUBAI LANDLORDS OFFER ‘FREE’ RENT, MULTI CHEQUES

DH90M: LATEST 'MEGA VILLA' DEAL IN DUBAI

ONE DUBAI MASTER-DEVELOPER GETS CRACKING WITH LUXURY

POTENTIAL HOME BUYERS IN DUBAI MUST MAKE UP THEIR MINDS FAST

DUBAI’S OFFICE REALTY NEEDS TO MIX IT UP

PROPERTY PRICES GO WITH THE FLOW ALONG DUBAI CANAL

LOOK: DUBAI VILLAS SURROUNDED BY FOREST

NEW DH5B TOWER COMPLEX PROJECT UNVEILED IN DUBAI

NEW DUBAI REAL ESTATE CORP BOARD UNVEILED

RIDE ALONG: NAKHEEL OPENS MONORAIL STATION ON THE PALM

DUBAI HOMES: LIVE-IN THE DREAM



DEFINING LANDSCAPES SINCE 1985



REAL ESTATE NEWS SHORT ON DOWN PAYMENT TO FINANCE YOUR PROPERTY IN DUBAI?

RISING SCHOOL FEES HIT DEMAND FOR LARGER HOMES IN UAE

VILLA AT EMIRATES HILLS FETCHES DH90M

DUBAI'S TAMWEEL TOWER RESIDENTS HIT WITH OUTSTANDING SERVICE CHARGES

SHEIKH MOHAMMED UNVEILS DH5BN EMIRATES TOWERS BUSINESS PARK

DUBAI DEVELOPER AZIZI BEGINS WORK ON DHS12BN RIVIERA PROJECT IN MBR CITY

DEWA AWARDS DH46M CONTRACT FOR PHASE 1 OF AL-SHERAA BUILDING

RECORD INDICATOR FOR CONSTRUCTION COSTS UP 0.06 PERCENT IN DUBAI IN 2016

AZIZI BEGINS WORK ON DH12B RIVIERA PROJECT IN MBR CITY

ABU DHABI

ARABTEC’S TARGET LANDS FOUR CONTRACTS WORTH DH289M

SOROUH PROFITS UP 75%

ADIA TARGETS EMERGING MARKETS AS LONG-TERM GAINS SLOW

JOB LOSSES HIT ABU DHABI REALTY HARD

NEW DH170 MILLION PORT FOR DELMA ISLAND

NORTHERN EMIRATES

RAK PROPERTIES DELIVERS BERMUDA VILLAS PROJECT

LOWER SHARJAH RENTS A BOON FOR TENANTS

SHARJAH RENT DROPS 'LIKELY' ON TOP OF 5.5% DECLINE IN THE LAST 12 MONTHS,

SAYS PROPERTY CONSULTANCY

ILLEGAL CONSTRUCTION PULLED DOWN IN SHARJAH

RAK TO HAVE SEVEN NEW POWER STATIONS WORTH DH750M

INTERNATIONAL

CANADA SEEKS UAE INVESTMENTS IN INFRASTRUCTURE PROJECTS

TAXES TAKE THE HEAT OFF CANADIAN PROPERTY

COST OF GETTING ON THE UK PROPERTY LADDER SURGES TO RECORD

MANHATTAN APARTMENT PRICES HIT RECORD, AVERAGING $2.19 MILLION

GULF INVESTMENT TO CONTINUE IN BOOMING US WAREHOUSE SPACE






FIXED-TERM INVESTMENT PLANS ARE

FAILING UAE CUSTOMERS, SAYS FRIENDS

PROVIDENT Tuesday, July 4, 2017

One of the biggest providers of expensive fixed-term investment plans, the cause of a high number of complaints

from UAE customers, has admitted that the products are not good enough.

Philip Cernik, Friends Provident International’s chief marketing officer, said that the life industry “could do better”.

He acknowledged the rise in complaints to the UAE Insurance Authority about life companies and the financial

advisers that market the investment products, from customers frustrated by poor performance and very high

costs.

“There is no room for ‘one size fits all’ customer solutions today … If expats like to save for less than five years,

why are there so few alternatives in the market that reflect this?” Mr Cernik said in a column penned exclusively

for The National.

FPI, owned by Aviva, is one the leading providers of fixed-term products in the UAE and other markets in the

Middle East and Asia. The plans promise good returns but also come with high costs that include upfront

commission fees and charges.

To offer investors better protection, the IA confirmed in April that it was pushing ahead with tough new

regulations to transform the way savings, investment and life insurance products are sold in the UAE. Among the

proposals were plans to impose maximum limits on the upfront commission advisers can earn from life

companies. Advisers will also have to clearly illustrate all fees and charges for which the client is liable.

Mr Cernik said FPI has been working to raise the professional standards of advisers in the UAE, launching an

Adviser Academy in 2015.

“If customers are wary of advisers, isn’t it necessary for advisers to raise their professional standards?” Mr Cernik

asked.

To date 200 UAE-based advisers have passed through the Academy and FPI said this will help brokerages adjust

their business models “to make them fit for purpose” when the new IA regulations are introduced – something

experts expect to happen in the third quarter of this year.

However, Sam Instone, chief executive of the fee-based financial advisory company AES International, said FPI’s

proposals to transform its offering will not have an effect because “the system is broken”.

“It’s too little, too late,” he said. “They are trying to reinvent themselves – but they can’t. In reality, investment-

based insurance is expensive and opaque and ultimately doesn’t work because the funds available via life

insurance companies themselves don’t work.”

Source: The National

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ARABTEC WINS DH353M UAE PAVILION

CONTRACT FOR EXPO 2020 Tuesday, July 4, 2017

Dubai-based Arabtec Construction has won the Dh353-million contract to build the UAE Pavilion at Expo 2020

Dubai, the firm and the National Media Council (NMC) announced on Tuesday.

Arabtec Group CEO Hamish Tyrwhitt said in a statement to Dubai Financial Market (DFM), “The UAE Pavilion

project marks yet another achievement on our road map to a sustainable and successful future. It highlights our

strategic focus on the UAE as our core market and also demonstrates our commitment to building our future

through the development of social infrastructure in addition to instilling a performance-based culture within our

organisation.”

Arabtec’s share prices climbed over 12 per cent on the news, leading gains on the Dubai bourse.

The NMC, the government entity responsible for building and operating the UAE Pavilion, said in a press

statement that Arabtec won the contract over three other shortlisted local and international companies, from a

total of nine initial bids.

Spanish architect Santiago Calatrava, whose work includes the WTC Hub in New York and Rio de Janeiro’s

Museum of Tomorrow, has been chosen to design the pavilion following an international competition that saw

nine international firms submit 11 designs.

Arabtec, in its statement to DFM, where it is publicly listed, said Calatrava’s design was inspired by a falcon in

flight.

The NMC, in its statement, wrote, “The UAE pavilion will be one of the most important landmarks at the Expo 2020

Dubai, reflecting the authenticity and heritage of the UAE, its achievements in various sectors as well as the

nation’s values of openness, communication and tolerance, which are in line with the main theme of the

exhibition.”

The 15,000-square-metre pavilion will be located opposite Expo 2020 DUbai’s central Al Wasl Plaza. Expo 2020

Dubai is expected to attract 25 million visitors from more than 180 countries.

The upper floor of the pavilion spans an area of 2,000 square metres while the mezzanine floor will have an area

of 662 square metres. The ground floor, with gardens and parking spaces, sprawls over 13,300 square metres.

Another 3,000 square metres will be set aside for a plaza level and related facilities.

The pavilion’s design and construction aim to achieve the highest Leadership in Energy and Environmental Design

(LEED) rating.


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ECONOMIC SLOWDOWN LIKELY TO HURT

QATAR’S BANKING SECTOR ASSET QUALITY Wednesday, July 5, 2017

The recent sanctions on Qatar by a group of states led by Saudi Arabia, the UAE, Bahrain, Egypt, Libya, Yemen and

a few other allied countries is expected to have huge consequences on Qatar’s economy and its financial sector if

a resolution takes much time, according to rating agency Moody’s.

“Weaker economic activity could lead to deteriorating asset quality in the banking system and together with an

escalation involving sanctions against the financial sector could necessitate a step-up in government liquidity

support,” said Steffen Dyck, Senior Credit Officer, Sovereign Risk Group of Moody’s.

Although no such sanction has been applied to date, analysts say such a possibility can’t be completely ruled out.

In addition to rising global interest rates, funding costs for the government and other Qatari-based issuers will

increase further and the government’s balance sheet would deteriorate quicker in a scenario of a prolonged

stalemate that extends well into 2018. The sovereign has no external refinancing needs until the first quarter of

2018 when a $2 billion (Dh7.3 billion) sukuk issuance made by SoQ Sukuk A Q.S.C. will mature, but corporates

including government-related entities and banks are facing more sizeable redemptions over the next 12 months.

Aside from bond and sukuk, Moody’s estimates that total short-term external liabilities amount to more than

$115 billion (68 per cent of nominal gross domestic product (GDP) projected for 2017) of which roughly one third

is estimated to be due to creditors in the GCC. Moody’s estimates that about half of this is accounted for by non-

resident deposits and rollover risks would increase in a scenario of further financial sector sanctions.

The government has sizeable asset buffers, including roughly $35 billion in net international reserves at the Qatar

Central Bank and more than $300 billion of assets managed by Qatar Investment Authority (QIA). The

government’s significant resources together with liquid foreign assets in the banking system, which amounted to

about $30 billion as of May, according to Moody’s estimates, provide a strong mitigant against liquidity issues in

the short term. However, a deterioration in economic activities could have strong adverse impact on the financial

sector.

Qatar’s key economic indicators that stood resilient in 2016 and in the first quarter of 2017 are now looking bleak

as the country faces diplomatic and economic isolation from its neighbours and other Arab nations.

Qatar’s key economic indicators such as liquidity in the banking sector and credit growth were positive until the

end of the first quarter.

Total credit facilities continued to grow and stood at a record high level at the end of the first quarter of 2017,

with an increase of 1.9 per cent to reach 855 billion Qatari riyals (Dh862 billion). But with the economic sanctions

taking their toll on liquidity, Qatar is facing a potential funding shortage and high cost of funds that could curtail

credit growth leading to lower GDP growth, especially non-oil GDP growth.

“A de-escalation is likely only gradually. Risk of further escalation remains. The large FX mismatch in the Qatari

banking sector keeps it vulnerable to an abrupt withdrawal of GCC funding. We estimate $35 billion (20 per cent

of GDP) in banking sector capital outflows within one year if the GCC decides to sever financial ties,” said Jean

Michel-Saliba, Mena Economist of Bank of America Merrill Lynch.






Analysts say although QIA’s foreign assets will help the country withstand outflows and defend the peg, prolonged

outflows could erode QIA’s balance sheet.

According to Institute of International Finance (IIF), a Washington-headquartered global association of the

financial services industry, if the current crisis persists for an extended period and ties deteriorate further, Qatar’s

GDP growth could decline to 1.2 per cent in 2017 and 2 per cent in 2018, principally due to lower non-

hydrocarbon growth impacted by increased uncertainty weighing on investment and a tighter financial

environment and perhaps deposit flight that could raise the cost of funds.

Cuts in financial ties and increased counterparty concerns could hinder ease of doing business and trade finance.

“In this scenario, lower than expected non-hydrocarbon revenue could widen the deficit fiscal deficit to 7.8 per

cent of GDP in 2017. The external current account deficit could remain at around 2 per cent of GDP as the sharp

fall in travel- and transport-related service receipts due the prolonged travel bans of neighbours and airspace

closures,” said Boban Markovic, Research Analyst at IIF.

Source: Gulf News

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SOLID FUNDAMENTALS SUPPORT UAE’S

CREDIT STRENGTH: MOODY’S Monday, July 3, 2017

Strong economic fundamentals support UAE’s sovereign credit strength according to Moody’s which has assigned

a credit rating of Aa2 and had upgraded the credit outlook from negative to stable recently.

The global credit rating agency said its recent change in outlook for the UAE economy was in response to effective

policy response to the low oil price environment via an acceleration in the country’s reform agenda and the

ongoing recovery in the fiscal and current account balances. The UAE recorded a strong economic growth of 3 per

cent last year despite low oil prices.

“Superior infrastructure supporting diversification, very high per capita income and hydrocarbon reserves of

more than 70 years at the current rate of production also support creditworthiness. In addition, the UAE’s

domestic politics have a track record of stability and the country has strong international relations,” said Mathias

Angonin, a credit analyst with Moody’s.

Analysts say the UAE’s main credit challenge relates to weaker economic and fiscal metrics caused by the oil price

shock and the country’s fiscal reliance on hydrocarbons with 48 per cent of government revenue in 2016 coming

from this sector.

According to the rating agency, further improvements in policy and data transparency in the UAE and improved

diversification efforts would support upward revision of the rating outlook.

High income levels, resource endowment and competitiveness underpin UAE’s economic strength. “We assess the

UAE’s economic strength as ‘very high’ reflecting its very high income level, moderately large size, abundant

hydrocarbon reserves with low cost of extraction, vibrant non-oil economy, and well-developed infrastructure,”

said Angonin.

The hydrocarbon sector is projected to make a smaller contribution to real growth in 2017 because of the recent

Opec decision to freeze production. Average daily production levels reported by the government dropped 6 per

cent quarter-on-quarter in the first quarter of this year. However, the crude oil production outlook is largely

resilient to volatility in oil prices as very low extraction costs of UAE producers ensure economic viability of new

and existing projects.

The UAE’s non-oil growth decelerated again in 2016 to 2.7 per cent from 3.2 per cent in 2015 and 4.6 per cent in

2014. This relative slowdown is likely to extend into 2017, followed by a gradual recovery in 2018-2020.

“Supporting growth in the non-oil economy will be government spending — after two years of spending cuts, we

expect consolidated government spending to increase in 2017. In Dubai, mega-projects will continue to support

non-residential construction activity, which will accelerate in the years leading to the 2020 World Expo,” Angonin

said.


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UAE PMI DATA POINTS TO SOLID GROWTH

IN Q2 Tuesday, July 4, 2017

The Emirates NBD Purchasing Managers’ Index (PMI) for the UAE increased to 55.8 in June, up from 54.3 in May,

on the back of faster output and new order growth last month.

The latest improvement was supported by sharper rises in both new orders and output. The ongoing upturns in

output and new order book volumes encouraged companies to engage in input buying, leading to further

increases in inventories.

“The rise in output and new orders in June is encouraging, although we note that firms continued to reduce selling

prices on average in order to support demand and order growth. The survey also highlights the lack of

employment growth despite strong the strong increase in new work last month. Overall however, the PMI data for

[the first half of] 2017 supports our view that the non-oil sectors have grown at a faster pace relative to [the first

half of] 2016,” said Khatija Haque, head of Mena Research at Emirates NBD.

Remaining comfortably above the crucial 50 threshold, the latest PMI reading signalled a sharp improvement in

the health of the private sector. Notably, the rate of growth was stronger than the long-run series average of 54.5.

Data showed firms continued to discount selling prices in order to support order growth, with average selling

prices declining for the third consecutive month.

Firms also cited increased marketing efforts as contributing to new order growth.

As employment stagnated, new export orders fell for the first time in seven months as demand from international

markets reduced.

“This is disappointing against a backdrop of strong rises in output and new orders, and supports the view that

firms are reluctant to boost hiring in an environment where their margins continue to be squeezed,” Haque said.

Business confidence towards the 12-month outlook eased to the second-lowest in the survey history. Following a

decline in the prior month, there was a renewed increase in input costs.

External demand softened slightly in June, with new export orders declining marginally. While businesses are

optimistic about the coming year, the business optimism index fell to 56.5 in June, the second-lowest level on

record.

Just under 13 per cent of firms expected output to be higher in 12 months’ time, compared to 23.6 per cent in

May. Nevertheless, stocks of purchases (pre-production inventories) increased sharply in June, with this index

rising to 57.3 from 54.7 last month, suggesting that firms do expect output and new work to remain strong in the

coming weeks.

The average PMI reading for the second quarter of 2017 was 55.4, only marginally softer than the first quarter

and consistent with a strong rate of non-oil private sector growth in the UAE.

“The second-quarter 2017 PMI reading is also much higher than that for the corresponding quarter last year,

confirming that non-oil growth has likely accelerated [year-on-year], in line with our expectations. However, the

extension of Opec’s oil production cuts through second half of 2017 and first quarter of 2018 has led us to






downgrade our forecast for the UAE’s real GDP growth to 2 per cent this year, down from 3 per cent in 2016,”

Haque said.

The downgrade is entirely due to the projected contraction in oil production, which is not captured in the PMI

survey.


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QATARI PROPERTY INVESTORS KEEN TO

OFFLOAD ASSETS IN UAE Tuesday, July 4, 2017

Qataris with property investments in the UAE are in a state of limbo. In a kneejerk reaction, some of them pulled

the plug on their investments and sold at vastly reduced prices whereas a majority is still hopeful that the row will

be resolved.

Investors from Qatar and Kuwait cumulatively accounted for Dh2 billion worth of property transactions in Dubai

last year, according to the Dubai Land Department.

"The majority of our Qatari clients are in a state of confusion as to what to do. Some have sold and at greatly

reduced prices but many are just waiting before deciding what to do next," says Mario Volpi, chief sales officer,

Kensington Exclusive Properties. "There have been some sales, particularly from one Qatari investor who has

liquidated his entire portfolio before the initial two-week deadline to leave the UAE."

The level of discounts offered varies from seller to seller, but typically the amounts range from 10 to 15 per cent

below market price. "We did find a sudden increase in the number of Qatari owners who decided to sell their

assets in Dubai. Sometime has since passed and while we are still assisting some of these owners, the sudden

spike of interest has subsided," observes Nick Grassick, managing director of PH Real Estate.

However, another Dubai real estate brokerage, which wishes to remain anonymous, claims there is no sense of

desperation among its Qatari clients. "There is no sense of panic and our clients believe the problem will get

resolved," it adds. Qatari investors, like the rest of their GCC counterparts, prefer to purchase apartments, shops

and offices in the UAE that provide a stable source of income and good returns.

Preferences

"Typically, the Qatari investor prefers to buy apartments and stay within the established areas of Dubai such as

Downtown, the Palm Jumeirah and Dubai Marina," Volpi points out.

Brokerages say the majority of Qataris who buy property in the UAE are based in their home country. "Investors,

by their nature, are not owner occupiers of their investments and quite often reside outside the country of their

investments," adds Grassick. As a result of tightened restrictions, selling property has become more difficult for

Qatari nationals. Without being allowed into the country, sellers would have to sign a power of attorney to enable

a non-Qatari to sell property on their behalf.

"Given that a Qatari seller is no longer allowed to enter the UAE, he/she would have to arrange to meet the power

of attorney [POA] in a neutral country, say Oman or Kuwait, to prepare the POA documents. The POA can fly back

to UAE to then sell the property. This would only work if the seller also has a UAE bank account or the buyer

would agree to pay by bank transfer," informs Volpi.

What about UAE nationals who own property in Qatar? "Most UAE investors we speak with think this is a

temporary issue and will be sorted out sooner than later. So, not many are taking this as a factor in their

investment decisions," says Sanjay Chimnani, managing director, Raine & Horne Dubai.


Back to Index






SAUDI-OWNED PARISIAN HOTEL REOPENS

AFTER MULTI-MILLION MAKEOVER Thursday, July 6, 2017

The Hotel de Crillon, one of the world's oldest luxury hotels which looks onto the square where Louis XVI lost his

head, reopened Wednesday after a multi-million-euro makeover lasting four years.

The venerable Paris institution at the foot of the Champs Elysees, which is owned by a Saudi Arabia’s Prince Mitab

bin Abdullah bin Abdelaziz al-Saud, has boasted among its regulars the likes of Ernest Hemingway and Charlie

Chaplin.

The Saudi prince bought the hotel in 2010 from American group Starwood Capital, owner of the chain of the W

hotels and St. Regis hotels, for a reported €250 million ($328.4 million).

A team of 147 artisans attended to the finest details of the neo-Classical building, restoring period frescoes, gold

leaf trim and marble accoutrements in one of the world's most prestigious hotels.

It was the first facelift since the former residence of the Counts of Crillon opened to paying guests in 1909, and

comes after the legendary Ritz reopened last year after a four-year renovation.

The Crillon's restoration lasted two years longer than planned, partly because of the creation of a second

underground floor with a spa and swimming pool.

Room rates range from 1,200 euros ($1,360) a night to between 20,000 and 25,000 for the Bernstein Suite

overlooking the Place de la Concorde - where Louis XVI was guillotined in 1793 at the height of the French

Revolution and where German snipers fired on crowds during Liberation celebrations in 1944.

Managed by Rosewood Hotels and Resorts since 2013, the Crillon now has 124 rooms, compared with 147

previously.

Of those, 33 are suites and another 10 are "signature" suites of the greatest luxury, two of which were decked out

by German fashion designer Karl Lagerfeld.

The hotel's Michelin-starred chef Christopher Hache returns after embarking on a global mission scouting for

techniques and ingredients used by other top chefs.

In addition to running the hotel's flagship restaurant Les Ambassadeurs, Hache is in charge of a brasserie and bar

as well as a winter garden.

The hotel, which has attracted celebrity guests over the decades including Winston Churchill, Bill Clinton, Michael

Jackson and Madonna, was originally built in 1758. A twin building also overlooks the emblematic Place de la

Concorde.

Source: Arabian Business

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GENERATION START-UP: PROPERTYFINDER

CHIEF A PIONEER OF ONLINE REAL ESTATE Saturday, July 8, 2017

“We try to keep the start-up culture, definitely, because the start-up culture is fun, agile and reactive,” Mr Lahyani

explains. “But a start-up business usually has reduced funding, is unprofitable and I think we’ve grown out of that

phase, thankfully.”

Yet Mr Lahyani possibly has more relevant knowledge and experience to impart to entrepreneurial companies in

the UAE than most of his competitors. He went through his first funding deal when his business was only a couple

of years old, bought out this investor two years later in the midst of a major slump and then subsequently went

through two more funding rounds. The last one, which took place 18 months ago, valued his business at US$200

million.

Mr Lahyani launched Propertyfinder in 2005 because he said it was “solving a pain”.

When it came to searching for properties either to rent or buy, he says “there was no good destination to go to".

“There were supplements of newspapers but there was nothing online.”

He says that when the business started, online penetration “was below 50 per cent” for the real estate market. His

firm initially published a property listings magazine that was distributed for free across the city.

The move to go online was triggered by the realisation that “we were never going to win the print war", says Mr

Lahyani, especially as some competitors were offering big discounts to advertisers who signed exclusivity

contracts.

The firm moved to an online-only model in 2007, but Mr Lahyani says the switch was not an easy one to make. “I

don’t think the traffic was there when we did the change, but the minute you start working with online, thinking

about online, that’s when it starts coming."

Momentum was only gained among its property broker clients after the global financial crisis and the subsequent

slump in Dubai property.

“When markets are booming, the real estate industry is not looking for new ways of marketing,” says Mr Lahyani.

“As real estate agents started feeling the pain, they were more open to change."

The company had initially gained an investment from REA - an Australian subsidiary of News Corp - in 2007, but

after the hit Dubai property took in 2009, Mr Lahyani bought this stake back and he says the business turned

around within six to12 months.

He continued to fund the business from his own resources until raising funds again - initially with Beco Capital in

2013 and 2014, and then with Vostok New Ventures in 2015. The latter bought a 10 per cent stake for $20m.

Propertyfinder had enjoyed a five-year run with revenue growth rates of between 80 to 100 per cent per year, Mr

Lahyani says, before consolidating last year when it grew at about 30 per cent.

This was necessary, he says, for it to embed the proper systems and controls that a bigger company requires.

“Suddenly, you’ve gone from being a one or two-Location Company to a seven-location company with different

regulations and taxes. And you want to be able to issue audited accounts on time.






“You want to have HR policies across the board that are working, you want to have unified tools … to have visibility

throughout all your markets.

Propertyfinder now employs 260 people - about 140 in its main base in the UAE and the rest are in six other

markets where it has a presence, including Saudi Arabia, Egypt and Qatar.

Mr Lahyani says all technology and product development is done in-house in Dubai.

“I think, when you’re a tech business, outsourcing your tech is a bit like if you are a restaurant and you’re

outsourcing your kitchen. By the time the food comes, it will be cold and not what the customer ordered.”

He says products from other markets cannot really be imported. Propertyfinder tried to export its UAE model into

Saudi Arabia and Egypt, for instance, but found that did not work.

“Search habits are different in Saudi Arabia than they are here. People here will have been exposed to internet

products before they arrived in Dubai. In Saudi Arabia, less so. Therefore, the user experience needs to be a lot

simpler and you don’t want to drown them with too many functionalities.”

Sites also need to be simpler in Egypt as a result of a slower mobile network.

“That has an effect on how the product appears,” Mr Lahyani says.“ For us, speed is everything - before design. A

nicely designed website on your mobile, if it’s slow, doesn’t serve its purpose.”

He says in terms of traffic, the site is growing at about 100 per cent year-on-year and that the biggest

opportunities for growth are in some of those markets that are not as well developed.

“The amount of people that are online coming to search for real estate is really at the beginning of that 'hockey

stick' in the Middle East. That sounds crazy here in the UAE where everybody is online but we are digitalising

information that has never been digitalised before.”

In Saudi Arabia, for instance, he says although there are estate agents for expensive properties, a lot of the

listings that are moving online are details that “people either have on pen and paper or in their head but it’s never

been put down with a description, a title, an image, a contact number and made available online”.

It is the potential of these markets that provided part of the appeal for Vostok New Ventures to buy its stake in

the firm, says Bjorn von Sivers, the head of investor relations at the venture capital firm and a member of its

investment committee.

Vostok New Ventures is a specialist venture capital (VC) firm with a niche in investing in online classifieds and

marketplace sites in emerging economies. Its most successful investment has been in the Russian classifieds site

Avito.ru - a business in which Naspers bought a majority stake in 2015 for $1.2 billion.

Mr von Sivers says Stockholm-based Vostok first became aware of Propertyfinder when broadening its

geographical scope for investment outside Russia and on to the Middle East.

“We looked at a number of businesses within this niche in many markets, and then we came across Michael and

we really liked Propertyfinder and how far he has taken the company.”

Mr von Sivers says both Saudi Arabia and Egypt are obvious countries for development, stating that although

Egypt has the lowest GDP, it is the biggest market.

“There’s no company yet that has really taken [either market].

“There’s a big opportunity if you invest there. If you put in a lot of focus you can become the winner.”

Alex Nicholas, the co-founder of the competitor JRD Group, which owns the Justproperty.com brand, agrees. His

company raised Series A funding from iMena Group in August 2015 and is also looking to expand into Saudi






Arabia and Egypt. In fact, he says, it agreed the investment from iMena because of its influential Middle East

backers.

“We’d been approached by a few US VCs and in my opinion they didn’t really seem to provide much, other than

just the money. iMena had the regional connections.”

Its funding is partly to grow its portal regionally but also its Propspace CRM software for brokers. However, Mr

Nicholas agrees that most markets outside the UAE are up for grabs.

“None of the portals have really taken any of those markets, I think it would be fair to say,” he says. “If you speak

to people on the ground in Saudi Arabia, they haven’t really heard of any of the portals that are big in the UAE.”

Mr Lahyani has plenty of firepower and an experienced team around him that he hopes will be able to help it

become the major player. He says it has a network of international investors “some Silicon Valley, in Asia, in

Turkey, in Europe” that have been real cheerleaders for its brand.

He says raising VC funding does not become easier for the second round, as a different set of characteristics are

required - investors want a clearer plan for deliverability to justify any increase in valuation and expect a more

defined vision.

But his most important piece of advice for entrepreneurs thinking of raising capital is to wait as long as they

possibly can before bringing in external funding.

“When I bought out REA in 2009 and Beco invested in 2013 that was a long few years on my own where I wanted

to raise money.

“In hindsight, I’m so glad that I didn’t because I would have diluted myself much earlier.

“I always say to entrepreneurs when they say they are trying to raise [VC funding], ‘do you think you can get

through the next 18 months without raising?’

"If the answer is yes, put your head down and keep pushing.”


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UAE SHINES AS SUSTAINABLE ENERGY

PATHBREAKER Saturday, July 8, 2017

Energy experts are hailing the UAE for its leading role in promoting renewable energy across the Arab region.

From establishing Masdar some 11 years ago in Abu Dhabi, to building wind and solar farms in the UAE as well as

other Arab countries, the UAE is looked at as a pioneer in renewables.

The UAE’s focus on renewable energy comes at a time of increasing demand for energy as the population grows,

as oil prices have dropped to half of their value from just three years ago, and amid increasing global urgency to

reduce carbon emissions.

“The outlook in the renewable and alternative sources of energy is extremely positive in the UAE,” said Nizar Jichi,

Partner, Audit, Oil and Gas at KPMG, one of the largest professional services networks in the world.

“This positive outlook is evident from the vision of the UAE Government, wherein as per the UAE Energy plan

2050, UAE aims to reduce dioxide emissions by 70 per cent, increase clean energy use by 50 per cent and improve

energy efficiency by 40 per cent by 2050,” he told Gulf News.

Several projects have been planned, tendered, awarded, implemented or have already started operating in UAE.

More are in the pipeline.

“The UAE is leading the GCC countries in the diversification of the economy and also in pursuing ground-breaking

renewable energy and energy efficiency programmes,” said Mamdouh Salameh, an international oil economist

and a visiting professor of energy economics at the Europe Business School in London (ESCP).

“In 2015, the UAE ratified the Kyoto Protocol to the UN Convention on Climate Change, becoming one of the first

major oil-producing countries to do so. Moreover, the Abu Dhabi government has also established one of the

world’s most comprehensive clean energy initiatives.”

The drive to diversification is partly due to falling oil prices, which have caused major budgetary deficits for a

number of oil producing countries.

“Diversification for UAE and other GCC countries is not a luxury but a necessity. It is high time that these countries

rid themselves from almost total dependence on oil revenues and the impact of oil price volatility on their

economies,” Salameh told Gulf News.

UAE is among the main oil producers in Opec, along with Saudi Arabia, Kuwait and Qatar. The six Arab Gulf states,

along with both Iraq and Iran are believed to be sitting on nearly 50 per cent of the world’s oil reserves, according

to the US Energy Information Administration.

Salameh observed that “a major aspect of diversification is intensive investment in solar and nuclear energy for

electricity generation and also for replacing oil with solar power in water desalination plants throughout the Gulf

region.”

Such measures have economic and environmental benefits in “prolonging the longevity of the oil wealth and also

being friendly to the environment,” he said.

Masdar, a subsidiary of Mubadala, which is the investment arm of the Abu-Dhabi government, has been a

“catalyst” for the adoption of renewable energy and clean technologies, particularly in the Arab world.






“Since 2006, Masdar has invested in renewable energy projects with a combined value of $8.5 billion [Dh31.2

billion],” said Bader Al Lamki, Executive Director for Clean Energy, Masdar, Abu Dhabi Future Energy Company.

In a written responses to Gulf News, Al Lamki said: “We are active in utility-scale renewable energy development,

off-grid clean energy projects, and sustainable urban development through our flagship project Masdar City.”

Masdar’s renewable energy projects had extended to include UAE, Jordan, Mauritania, Egypt, Morocco, the UK,

Serbia and Spain. The electricity generating capacity of these projects, which are either fully operational or under

development, is 2.8 gigawatts (GW) gross.

Masdar is the main company in carrying out many projects that come within the efforts of achieving the UAE’

energy plan for 2050.

According to the plan, the target has been set at 44 per cent from renewable energy, 38 per cent from gas, 12 per

cent from clean fossil and 6 per cent from nuclear energy, Jichi said.

“The UAE Government has made an accomplishment in drafting the first unified energy strategy for the UAE

covering production and consumption. The integration of renewable, nuclear and clean fossil energy is planned to

be funded with investment of Dh600 billion over the next 33 years, equating to an annual spend of more than

Dh17 billion,” he said.

Renewable energy received more attention after the sharp fall in oil prices in the past three years, when the prices

went as low $28 per barrel.

Experts say producing energy from renewable sources is expected to help clean the environment, meet

increasing demands as well as allow governments to save part of the oil and gas resources for export.

“Lower oil prices do not seem to have any major impact on the renewable energy, as the region specially UAE,

continues to be focused towards expanding and diversifying the energy supply mix in line with its Energy Strategy

mix by 2050,” said Jichi.

“This is evident from the fact that Dewa, which had initially targeted to generate 1 gigawatt of power, now plans

for this facility to produce 5 GW of clean power annually by 2030,” he said.

In Dubai, the target of the clean energy strategy aims to increase the share of clean energy in the energy mix to

reach 75 per cent by 2030.

Apart from the government initiatives, the private sector in UAE is participating.

Majid Al Futtaim Properties, owner and operator of several shopping malls in the UAE has announced recently

that it signed an agreement with an energy company to supply four of its malls with solar energy. Under the deal,

hundreds of solar panels will be installed on its buildings, including car parks.

The Dubai Municipality has also been introducing solar energy in many public places. Four parks in Dubai are fully

using solar energy, and thousands of solar bulbs have been installed in parks and other facilities.

Source: Gulf News

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DUBAI REMAINS RELATIVELY STRONGER

THAN ABU DHABI MARKET Saturday, July 8, 2017

Last week the Dubai Financial Market General Index (DFMGI) managed to end slightly higher, up 9.15 or 0.27 per

cent to close at 3,401.15. There were 20 advancing issues and 14 declining. Volume was subdued, on the low end

of the past eight months or so.

For the past several weeks the DFMGI has held above a tight short-term support zone from 3,373.76 to 3,371.08

(last week’s low). This is very close to a multi-week resistance zone around 3,368 that appeared last

October/November, and in the area of support represented by the intermediate-term downtrend line.

A decline below last week’s low signals a continuation of the retracement off the 3,465.38 swing high from three

weeks ago. However, nothing significant changes as support of the downtrend line and minor weekly support

around 3,354 is close by. Further down is the 3,264.36 swing low support from five weeks ago.

Developments in the chart of the DFMGI recently continue to point to the likely continuation of the bullish ascent

that began five weeks ago. That rally took the index above both the downtrend line and 55-day exponential

moving average (ema) thereby pointing to a bullish change in trend. The current pullback has tested the trendline

as support and it has so far held. Next the index should be close to continuing the rally started five weeks ago.

So far there has been only one leg up off the 3,264.36 low. Given how trends generally progress there is a high

probability we’ll see a second leg up. As of now the second leg up could start from last week’s low. If so, we can

arrive at one potential higher price target by calculating a measured move.

A measured move is a classic chart pattern that occurs frequently in markets where the second leg up (or down)

approximately equals the price appreciation of the first leg up (or down). It reflects the tendency for market

swings to sometimes have symmetrical price relationships. The current measured move in the DFMGI points to a

potential price target of 3,572.10. This is useful by itself but more reliable here given that the prior swing high

target from early-April is almost a match at 3,573.25.

Whether the targets are reached or not the above analysis indicates the potential for further upside. First though

a new short-term bullish signal needs to occur. The first bullish signal is on a daily close above last week’s high,

and then on a daily close above the three week high at 3,465.38.

Abu Dhabi

The Abu Dhabi Securities Exchange General Index (ADI) declined by 29.05 or 0.66 per cent last week to end at

4,396.36. Market breadth was close to even with 18 advancing issues and 16 declining, while volume improved to

the third highest level in nineteen weeks.

A short-term bearish trend continuation signal was generated as the index dropped below the prior week’s low of

4,390.22, before finding support at 4,358.36 on Tuesday and bouncing slightly. That low was in an anticipated

support zone around the March swing low of 4,355.26. It has the potential to become a floor that could hold for a

while. We’ll know soon enough as a daily close below the March low is a sign of further weakness and a

breakdown of that support zone. Watch closely as volume is low during the summer and there can be a tendency

for price to overshoot price levels thereby giving false signals. There may be little or no follow-through in the

direction triggered. Subsequently, the move is reversed and the originally anticipated response occurs.






The next lower potential support levels below the March low look to be first the 200-day ema, now at 4,307.28,

followed by monthly support around 4,248.

Stocks to watch

Price behaviour in Deyaar Development has some similarity to recent activity in the DFMGI. During the recent rally

off the 0.45 swing low from late-May Deyaar broke out above both its downtrend line and 55-day ema. Resistance

was then seen at a 0.54 leading to a retracement that has so far tested the downtrend line as support and held.

A rally above last week’s high of 0.52 gives the next sign of strength, followed by a move above the more

significant 0.54 swing high. The three-week low of 0.496 needs to hold to sustain a short-term bullish outlook. Last

week Deyaar was up 0.20 per cent to end at 0.51.

Aramex broke out of a bullish flag pattern last week as it rallied above 5.31. The stock closed up 4.4 per cent for

the week to 5.31. That’s close to the week’s high of 5.44. The pattern formed on support of the 21-week ema,

which was previously tested as support once before in February leading to a strong rally.

The breakout has just started so keep an eye out for entries on weakness. Confirmation of the bullish breakout

next occurs on move above the 2017 high of 5.50. Aramex then heads toward the target derived from the flag

pattern, which is around 6.66.

Last week’s low of 5.20 is near-term support. Price should hold above that price during any weakness. If not, and

there is a daily close below it, the breakout has the potential to fail.

Source: Gulf News

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DUBAI PROPERTY MARKET DIRECTION

DEPENDS ON SUPPLY, SAYS JLL Wednesday, July 5, 2017

The next direction Dubai’s residential property market takes depends on how much of the stock developers have

in their current pipeline is actually delivered, according to a new report by JLL.

The property specialist said that Dubai’s residential market is "stabilising", with apartments declining in price by

just 0.3 per cent over the past 12 months, while villa prices fell by just 0.8 per cent.

It is forecasting an increase in prices over the next 12 months on the basis that although prices are flat,

underlying sales activity is increasing.

Craig Plumb, the head of research for JLL Mena, said that sales of completed homes have increased by 24 per cent

in the first five months of this year.

“If you look at off-plan that has gone up even more. It’s gone up by 70 per cent,” he added.

“When you get more sales, it suggests that prices will go up within the next year.”

Mr Plumb is forecasting a “fairly modest” increase in house price sales in Dubai of up to 5 per cent in the second

half of 2017, but added that this was dependent on how many new homes are delivered.

JLL said that that 78,000 new homes are due to complete by 2020, based on developer estimates. This is a 15 per

cent increase on historic forecasts. Given that population growth is predicted to be 3.5 per cent year-on-year,

there would be an oversupply if forecast supply comes to market.

However, the firm said that it expects the materialisation rate (the number of homes that are actually delivered,

as opposed to developers’ targeted completions) to be around 40 per cent, which would dampen supply.

JLL had predicted an upturn in the property market early last year after a period of price stabilisation, but a

number of subsequent events such as Brexit and a sustained high US dollar value (to which the dirham is pegged)

caused greater market uncertainty.

Meanwhile, a report published by propertyfinder stated that sales prices fell in 17 out of 23 districts across Dubai

in the six months to March 2017, while rental values fell in 21 markets. Prices fell most sharply (by 6.7 per cent) in

Downtown Dubai, which remains the most expensive district. Prices also fell by 3.5 per cent in Dubailand and 3.6

per cent in International Media Production Zone.

Writing in the report, Kalpesh Sampath, the chief operating officer of property broker SPF Realty, warned that

developers had been “ramping up launches of their off-plan projects in the last six months with no stop in sight”.

“Even real estate agencies working almost entirely on off-plan projects have raised concern that there is an

overload of new project launches,” Mr Sampath said.

“Developers are locking in the money, but in the long run the situation may turn on its head as increasing supply

may outstrip demand, and lead to a lull in interest, or a slump in pricing trends.”


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DUBAI RESIDENTIAL SECTOR STABILISING Wednesday, July 5, 2017

The Dubai residential sector, which has been a "buyers' market" over the past two years with average sale prices

for both villas and apartments declining between five and 10 per cent in the year to mid-2016, has begun to

stabilise as the down cycle nears an end, real estate consultancy JLL said on Wednesday.

The real estate picture is stabilising with residential prices declining by less than one per cent in the year to

second quarter 2017, JLL said in its Q2 2017 Dubai Real Estate Market Overview report. "The next movement in

price [up or down] will be dependent on how many of the potential supply of 78,000 units actually complete over

the next three years."

"Our assumption that prices will see a marginal increase over the next 12 months is dependent on further delays

to supply being experienced. Rents continue to see single digit year on year declines of 4.2 per cent and 6.5 per

cent for apartments and villas respectively. These figures relate to new lettings, with few landlords being willing to

reduce rentals for existing tenants," said the report.

"The Dubai real estate market largely remained relatively subdued in second quarter and the market sentiment is

expected to become more positive in the second half of the year," said Craig Plumb, head of research for the

Mena at JLL.

He said the second quarter of 2017 saw the addition of 3,600 residential units to the market. Notable completions

included 584 townhouses in Al Warsan Village in International City, as well as 250 villas in Al Furjan. Apartments

accounted for 60 per cent of completions being spread across a range of locations including Dubai Marina,

Meydan, and Al Wasl. A further 25,000 units are currently under construction and scheduled for delivery by the

end of 2017, but only half of these are considered likely to be handed over to purchasers by year-end.

According to JLL, the Dubai residential market has around 78,000 units under construction and scheduled for

delivery by 2020, indicating a 15 per cent growth from current supply levels. With a forecast population growth of

3.5 per cent per annum, this potential supply is in excess of the underlying level of demand and could therefore

result in increased vacancy levels if it were all to be developed on schedule. "Although many units are targeting

international and local investors, the key challenge then becomes one of securing tenants and therefore achieving

a satisfactory return on investment."

The office sector witnessed a relaxation in regulations resulting in offshore activities being permitted within the

DIFC, and dual licenses to allow firms to undertake both onshore and offshore activities from a single location.

These new regulations will be able to expand potential demand within the DIFC, paving way for overall economic

growth of the city.

The fast growth of Dubai's tourism over the last decade following the government's strategy to diversify the

economy in the run up to Expo 2020 has opened doors to the hospitality market becoming more complex.

Investors are now becoming more creative in their approach and the first hospitality-focused Reit (Five Holding

Reit) has been announced in second quarter. Traditional players are now reconsidering their strategies rigorously

through re-branding or de-branding properties, the report added.

The Dubai office market saw the delivery of around 33,000 sqm in second quarter 2017 with the completion of

the Tamani Art building in Business Bay, bringing the total stock to around 8,788,000 sqm. A further 190,000 sqm

is currently scheduled to complete in the second half of 2017, although some projects may be delayed into 2018.

The commercial office sector continues to operate as a two-tiered market, with healthy demand for single owned

buildings in the free zones and those offering joint licences. This has resulted in vacancies remaining stable in the






CBD at 14 per cent in second quarter 2017. Average rents in the CBD increased marginally by 1.3 per cent year-

on-year to Dh1, 947 per sqm during second quarter. The secondary market remains weaker, with a 37 per cent

decline in rental values over the past year, due to a sustained oversupply of strata office product and a general

softening of demand.

Source: Khaleej Times

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DUBAI HOTEL OWNERS LOOK FOR NEW

WAYS OF EARNING IN CROWDED MARKET Wednesday, July 5, 2017

Dubai’s hospitality market is becoming much more complex in the run-up to Expo 2020 as developers and owners

look at different ways of monetising the assets they are building, according to broker JLL.

JLL said in its latest Dubai Real Estate Market Overview that hospitality-focussed REITs (Real estate investment

trusts) are likely to come to fruition following the recent launch of Five Holding’s REIT.

“Traditional players are also reconsidering their strategies through rebranding or de-branding of operating

properties,” the report said.

Some 2,500 new hotel rooms were added to the Dubai market in the first half of this year, bringing the total to

more than 80,400. A further 40,600 are due to be delivered in the next two-and-a-half years.

Most of the completions that have taken place so far this year have been in the luxury end of the market,

“confirming the city’s heavy dependence on the upper end of the market”.

It said that despite additions such as the new 270-key Rove Trade Centre, mid-market hotels only account for 18

per cent of the market, with the majority of these based in districts like Barsha Heights and Bur Dubai. Moreover,

mid-market properties are only expected to contribute about 8 per cent of the rooms currently being built,

compared with 40 per cent for the upper end.

The building spree of new hotels is placing further pressure on room rates, even though Dubai’s efforts at

growing tourism means occupancy rates remain high - at 84 per cent in May 2017, compared with 82 per cent a

year earlier. Average daily rates have dropped by 3 per cent over the same period to US$206 per night, JLL said,

citing figures from hospitality consultancy STR.

Craig Plumb, the head of research at JLL Mena, said: "As the market is becoming more competitive, margins are

going down, so they [owners] will change operators in order to try and increase returns.

"Occupancies have been relatively OK, but room rates are going down so that just means that they have to

squeeze extra revenue and cut costs to keep up the level of returns."

Five Holdings is one company that has recently ‘de-branded’, although its removal of staff of operating company

Viceroy Hotels Group from its new Palm Jumeirah Hotel in Dubai is currently the subject of a legal dispute.

When announcing its decision to rebrand the property, the Five Hotels chief executive Aloki Batra said that “the

people who actually provide a hospitality experience never receive the real benefits, while most of the commercial

benefits are taken in most cases by operators”.

Emaar Properties, meanwhile, recently announced that it is introducing a new hotel management operating

model for owners willing to take on one of its brands.

It said that prevalent fee structures involve operating companies receiving a base fee, which is a percentage of the

hotel’s total sales, plus an incentive fee based on gross profits.

Emaar said that its model was based purely on the incentive fee, which “aligns the interests of the owner and

operator as it focuses on profit generation”.






"The distribution landscape in the hotel industry has changed dramatically and we feel that profit is a more

powerful indicator of operator performance than revenue,” explained Olivier Harnisch, the chief executive of

Emaar Hospitality Group.

But changing management of hotels is not an easy process, according to Mr Plumb.

“Ending a contract with one management group and taking up one with another is not that straightforward an

exercise, so there are some constraints around that," said Mr Plumb.

"But even if they stay with the same operator, they are trying to renegotiate terms to get a more profitable aspect

to the contract.”


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BEWARE OF SPECIAL OFFERS ON OFF-PLAN

PURCHASES Wednesday, July 5, 2017

Novice property buyers hunting for bargains on Dubai’s off-plan residential market are being duped by

misleading offers, a UAE real-estate expert has warned.

Firas Al Msaddi, the chief executive of fäm Properties, said yesterday that properties in prime areas are often

advertised by developers as having “the best” or “the lowest” price – something that lures in investors focused on

price rather than the liveability of the home.

“The ads are misleading,” said Mr Al Msaddi, “because they are implying that they are the cheapest; but ask a

property agent to evaluate the offer for you and they will tell you otherwise.”

Mr Al Msaddi said inexperienced investors can be caught out by the low sale price for the unit in comparison to

other properties in the area, and forget to assess the price per square foot.

“The ad will claim these are the lowest prices in Business Bay, for example, but they are only the lowest because

the units are squeezed. When you look at the price per square foot it is actually higher than the average for the

area."

“If someone has been buying and selling for the last five years, they would figure it out, but the inexperienced

investors don’t pay attention to this.”

Mr Al Msaddi says his brokerage has had many people selling at a loss because they fell for the offers and then

could not let out the space at the rate they wanted.

He said this is particularly the case in prime areas like Downtown Dubai, where the vast majority of end users are

GCC citizens, other Arabs and Indians who demand spacious two, three and four-bedroom homes.

“They buy off-plan and when it’s complete the whole evaluation shifts from being something on paper to the real

thing,” he said, adding that purchase decisions in prime locations should be based on what end users see when

they visit ready properties.

Mr Al Msaddi said he has seen off-plan two bedroom apartments in the area priced as low as Dh1.6 million to

Dh1.8m – in comparison to the average for the area of between Dh2.5m and Dh2.8m.

“The brochures are nice and colourful, but the buyer does not visualise how small the apartment is until it’s too

late. Once the property is handed over, no one cares about the price you purchased at, it’s all about whether it’s

attractive to end users or not."

The warning comes amid a boom in Dubai residential off-plan sales. Properfinder.ae, a listings portal, said off-

plan sales are expected to continue until the end of the year as low-deposit speculators take advantage of

increasingly generous payment plans and a greater choice of projects.

The firm said that cheaper homes and lower deposit requirements were driving investors towards off-plan deals.

Despite median prices for home falling by 20 per cent between November 2015 and April 2017, the lower prices

have not affected developers’ off-plan sales, said propertyfinder.ae.






Simon Kennedy, managing director of the property broker Edwards & Towers, said his firm had not experienced

any mis-selling by developers – particularly since the Land Department tightened regulations governing off-plan

sales.

“I haven’t seen any evidence of misleading offers,” he said. Instead he said off-plan buyers have better options.

“Select properties has just relaunched a few units in Marine Gate 1 in Dubai Marina where the investor pays 10

per cent now, 30 per cent on completion and 60 per cent on a two-year quarterly payment post-completion,” he

said.

“If you are exposing a lot of money during the construction, that’s when the risk starts to pile up, but [if] you are

only exposing 30 per cent then you are quite de-risked.”

However, for those that are misled by agents, Mr Kennedy said buyers must fully research pricing by cross-

checking what the developers are offering with what’s listed on the resale market through portals such as

dubizzle and propertyfinder.ae.

Mr Al Msaddi said investors should adopt a two-step process when considering a purchase to protect their

investment.

“First look at the price per square foot and at the tag price – both have to within the average for that area," he

said. "Next, look at the liveability of the apartment and the size of the rooms.

“There’s a lesson here for both investors and end users who need to evaluate a property in the context of

expected end user demand once the project is completed. This can be measured in terms of the property’s

liveability offering – the amount of space and comfort – combined with the individuality and unique nature of the

development and the overall market supply factor.”

Both Emaar properties and Damac Properties have reported higher sales in the first quarter of 2017 – Emaar

booked deals worth Dh6.05 billion in the first quarter – a 44 per cent year-on-year increase while Damac sold

properties worth Dh2.2bn – up 11 per cent year-on-year.


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DUBAI LANDLORDS OFFER ‘FREE’ RENT,

MULTI CHEQUES Thursday, July 6, 2017

Landlords in Dubai aren’t just open to accepting multiple cheques and reducing lease rates, they are also offering

rent-free periods just to attract tenants.

Despite claims that the property sector is bottoming out or showing signs of recovery, overall rents across the

emirate are still on decline.

A slowdown in hiring and a sustained rise in the number of new apartments and villas continue to impact

demand, prompting landlords to sweeten the deal.

With fewer jobs, there are fewer people with money to pay for rent. Compounding the decline in demand is the

increase in supply of new properties. Just this year alone, some 30,000 units are expected to be turned over to

investors. So far, about a tenth of the number has already been delivered.

As a result, according to Propertyfinder Group’s UAE Real Estate Trends 2017 report, Dubai residents have gained

more negotiating power when it comes to dealing with landlords.

“New tenants and their brokers have been able to negotiate concessions that were previously dismissed or largely

unheard of in the Dubai market, such as rent-free periods.”

A quick look at various property listings in Dubai shows owners enticing potential tenants with “free” rents,

especially for flats that have recently been delivered. “Brand new, one-month free [rent], with appliances,” reads

one listing.

Landlords are also resorting to other concessions, such as reducing rents for existing tenants, accepting multiple

cheques and paying broker commissions. Owners have no other recourse, considering that they stand to lose

money if their property stays empty even for just one month.

“Considering a one-month vacancy period equates to a loss of 8.3 per cent, which typically is close to, if not more

than, the yield that most properties produce annually, concessions like these are not only smart business for the

investor, but a win-win for all parties regardless of the market,” wrote Jochinke.

Propertyfinder’s research among the nearly 24,500 Dubai apartments and villas advertised for rent showed that

just about one in six specify the number of cheques required. Out of those that do, 1,842 listings state that

tenants can pay in four cheques.

“The current market has seen some power returning to tenants – they can start to dictate more favourable terms

and the amount of cheques is often one of those negotiation points,” said Lukman Hajje, chief commercial officer

of Propertyfinder Group.

According to the latest report from Reidin, Dubai’s rental market fell 4.57 per cent year-on-year in May due to a

sharp decline in values in both apartment villas compared to a year earlier. Rents have decline in various

locations, including in areas close to the Metro.

Apartment rents dipped by 0.30 per cent in May compared to a month earlier and by 4.22 per cent compared to

the same period last year. Rents for villas showed a slight uptick, rising by 0.32 per cent month-on-month, but still

down by 6.5 per cent year-on-year.






Propertyfinder’s review of the property sales prices and rental values of apartments in 23 neighbourhoods across

Dubai covering the six-month period from September 2016 to March 2017 also showed that rates did continue to

weaken.

“There are a number of elements at play: high levels of construction in the lead up to 2020 increasing supply and

competition for buyers and renters; a new reality of oil prices at $50 per barrel; a historically low GBP and Euro

encouraging British and European owners to liquidate their UAE property holdings to realise currency profits,”

Hajje said.

And it looks like the situation will remain the same for the rest of the year, unless more jobs come in and more

expats move to Dubai.

“Until job numbers, population growth and economic growth enter their next positive phase, which we anticipate

seeing in mid-to-late 2018 in response to spending from both government and private sector in the lead up to

Expo2020, expect to see further weakening of the rental market,” noted Jochinke.

Source: Gulf News

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DH90M: LATEST 'MEGA VILLA' DEAL IN

DUBAI Thursday, July 6, 2017

The mega-sized property deals are coming through — an Emirates Hills villa sold for a whopping Dh90 million and

was closely followed by another on the Palm, which commanded Dh84.2 million.

These were the two most expensive non-off-plan transactions in Dubai during the second quarter, according to

the estate agency Luxhabitat.

In fact, Emirates Hills’ properties accounted for four of the top five spots. And villas seem to be back in favour with

investors after a fairly long hiatus.

There was a 7 per cent increase in villa transactions over the first quarter to total Dh1.3 billion.

And 50 per cent of these were in Emirates Living clusters, which includes Emirates Hills, Springs, Meadows and

The Lakes. (Emirates Hills properties accounted for Dh270 million.)

Across the board, the second quarter generated Dh3.6 billion worth of deals for prime/high-end property, with 62

per cent of these involving apartments.

The Palm Jumeirah was the top choice for investors choosing upscale options, and recorded Dh771 million by way

of sales, states Luxhabitat. It was followed by Dubai Marina with Dh667 million and the Downtown with Dh340

million.

Relative bargain

It could be that investors are still seeing a relative bargain by acquiring a high-end property now. At many of the

established locations, prime property values are still some way off from their mid-2014 peaks.

“We are seeing a flattening of price evolution - as of Q2, the price per square foot for prime residences is

Dh1,482,” states the Luxhabitat report. “The prices are at similar levels as of Q4-2015.”

According to Jason Hayes, Managing Director of Luxhabitat, “Q2 results clearly reflect the ongoing positivity and

confidence in the market.” On the apartment side, one of the more expensive deals in the secondary market was

for a penthouse at the La Reve tower in Dubai Marina, which got Dh29.7 million.

Another unit in the Five Hotels & Resorts (on the Palm) went for Dh15.5 million and third place went to a deal at

the Palazzo Versace, for Dh15 million.

Investor interest

Right through the first six months, investors have shown an abiding interest for high-end properties, both off-plan

and ready. The coming quarters could see developers push the credentials of those homes in MBR (Mohammad

Bin Rashid) City and Dubai Creek Harbour.

The Water Canal-side options are also opening up for buyers, including the tower designated as freehold within Al

Habtoor City. There are also select clusters within Dubailand, notably the Akoya from Damac.

Source: Gulf News

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ONE DUBAI MASTER-DEVELOPER GETS

CRACKING WITH LUXURY Wednesday, July 5, 2017

One of Dubai’s master-developers, wasl properties, is going way beyond its mid-market bearings. If that means

reaching for the skies and prime waterfront locations, then all the better. In fact, wasl is doing just that.

In recent weeks, it awarded the tender for a flagship tower on Shaikh Zayed Road, and which should be ready by

the end of the decade, and confirmed its role in a mega-project that will bear the famed MGM name, which has

adorned high-profile properties in Las Vegas and elsewhere. It does not stop there.

The developer will be launching as many as 15 hospitality-themed projects in Dubai. This is quite a step up for

wasl, known more for its self-contained, low-rental apartment blocks stretching from Karama to Ghusais.

“We are committed to contributing to filling any gaps, whether in hospitality or residential,” said Hesham Al

Qassim, CEO of wasl Asset Management Group. “We identified such a gap with mid-range hotels, where we felt

the market was under-supplied.

“Another of wasl’s key objectives is to attract prestigious hotel operators to Dubai — we continued with this

strategy on a strong note this year by bringing world-renowned hotels such as MGM, Bellagio and Hyatt Centric to

Dubai for the first time. That’s in addition to the city’s second Mandarin Oriental hotel.”

But doesn’t all this mean a major strategy revision? “Our strategy and development priorities haven’t changed —

and won’t change,” said Al Qassim. “This reflects our aim to build a hospitality portfolio that ranges from mid-

range to luxury.

“We have completed four mid-range hotels, with two more due this year. Others remain under development and

due for handover in the next few years.

“We are fully aligned with the government’s plans to attract tourists and make Dubai the world’s favourite

destination. This is a major driver behind everything wasl does.”

The developer is working towards a tight schedule — construction of the MGM master-development is set for a

December start and completion in four years. Ditto with the construction schedule for the Bellagio property. The

wasl Tower on Shaikh Zayed Road is also headed for a Q4-20 completion. The project, for which Arabtec picked up

a Dh1.46 billion contract, will feature 148 luxury apartments as well as 257 hotel rooms under the Mandarin

Oriental brand.

The developer said the determined push into the high-end will continue. “We also have many other exclusive

developments underway that will add significant value, such as wasl 1 and wasl Gate, which together will bring

thousands of new residential units onto the market,” said Al Qassim.

“The research we conducted in 2015 for both the hospitality and residential sectors shed light on the gaps that we

can help fill. And this continues to inform our ongoing strategy.

“Based on that research, we decided to provide the market with mid-range offerings, and we now have four fully

operational hotels in this category, with others on track for timely completion. We also have significant projects in

the pipeline that cater to mid-market communities, including one in Warsan that will cater to hospitality staff as

the Expo 2020 approaches, as well as developments in Al Ghusais and Ras Al Khor that will be announced soon.






“At the luxury end, there is still high demand in the hospitality sector in Dubai.”

Perfecting a hospitality strategy

With wasl fronting MGM and Bellagio branded hotel projects is in line with Dubai’s master-developers scripting a

major push into hospitality. Meraas recently unveiled four brands that will adorn its hospitality projects, while

Nakheel has major projects going on at its Ibn Battuta cluster as well as on Deira Islands.

Explaining wasl’s strategy, Hesham Al Qassim, CEO, said: “We are known as a pioneer in the residential segment

and established a successful benchmark in this sector. But we apply the same standards to our hospitality

portfolio — we partner with only top hotel operators and brands. We already asset manage a large portfolio of

hotels, including some of the world’s best operators such as Starwood Hotels and Resorts, Hyatt International and

Hilton International.

“We don’t have any plans to create our own hotel management division ... but we will always be committed to

catering to market needs.”

Source: Gulf News

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POTENTIAL HOME BUYERS IN DUBAI MUST

MAKE UP THEIR MINDS FAST Wednesday, July 5, 2017

Potential property buyers in Dubai shouldn’t wait around to take a decision — chances are that some sort of

firming up in values will happen in the next 12 months.

At some of Dubai’s older and popular freehold communities, there have been marginal gains, of under 3-4 per

cent, in value from a year ago. And where prices are still dropping, the rate of decline has dipped by less than 1-2

per cent.

But in the second quarter, there was “little change in prices or rentals, although there were signs of increased

activity in the residential sector”.

All of which is far removed from the 5-10 per cent drop Dubai’s freehold areas saw in price declines in the 12

months to mid-2016.

The recent value gains are being led by improving demand for existing properties in the secondary market during

the first six months of the year.

Now, if this demand is maintained and there are delays in new homes hitting the market, it could put pressure on

prices.

Much will then depend “on how many of the potential supply of 78,000 units actually complete over the next

three years”, a JLL report says.

Materialisation rate

In Dubai, the “materialisation rate” — deliveries actually meeting promised deadlines — has been running at a low

40 per cent.

In the three months from April, 3,600 homes were delivered in Dubai, including 584 town houses at the Al Warsan

Village in International City and 250 villas in Al Furjan. “A further 25,000 units are under construction and

scheduled for delivery by the end of 2017, but only half of these are considered likely to be handed over by year-

end.”

And for those looking at the city’s rental market for bargains, there is even less of an opportunity to find a home

at lower rates. “Few landlords [are] willing to reduce rentals for existing tenants,” notes the new Dubai realty

update from JLL.

But at newly-let properties, prospective tenants might still see slightly more favourable terms from landlords.

“Rents continue to see single-digit year-on-year declines of 6.5 per cent and 4.2 per cent for apartments and

villas,” the JLL report states.

New lettings

“These relate to new lettings.”

On the office side of things, there is demand from tenants … but on extremely selective terms.

There is “healthy demand for single-owned buildings in the free zones and those offering joint licenses,” the

report states.






“This has resulted in vacancies remaining stable in the central business district at 14 per cent in the second

quarter of Q217.”

Average rents in the CBD have in fact risen, albeit marginally, by 1.3 per cent from a year ago to Dh1,947 a square

metre, around Dh180 a square foot, during the second quarter.

Secondary locations

But secondary locations have gone through a steep 37 per cent drop in rents over the last 12 months, “due to

sustained oversupply of strata office and a general softening of demand.”

Around 33,000 square metres of new office stock was delivered in the second quarter of 2017.

A time of change in Dubai’s office market

* Dubai allowing “dual licenses” for onshore- and offshore-related activities from the same address in DIFC has

had a qualitative impact on the market. “These new regulations should expand potential demand within the DIFC

and contribute to the overall economic growth of the city”.

Source: Gulf News

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DUBAI’S OFFICE REALTY NEEDS TO MIX IT

UP Wednesday, July 5, 2017

The UAE’s political and economic stability, rapid population and GDP growth, and an absence of corporate and

personal taxes are only some of the factors contributing to the UAE’s attractiveness to foreign investors.

Dubai has confirmed its position as a hot spot for international occupiers and investors alike and has become the

commercial engine driving investment into the region.

The city’s success can be attributed to the three T’s — tech, talent and tax (or the lack of it). Free zones offer zero

corporation tax, free repatriation of profits and no personal income tax, which acts as a strong pull factor for

publicly listed companies who have a fiduciary responsibility to minimise global taxes.

As part of UAE’s Vision 2021, the government invested Dh4.5 billion and had declared 2015 as the “Year of

Innovation”. The effect of this current wave of innovation is transforming the nature of work as we know it.

The rise of mobile connectivity and networked technology, artificial intelligence and automation, among others,

have both created and eliminated jobs and augmented others. It has spawned new ventures and lowered the

barriers of entry to entrepreneurship.

But it has also shuttered those windows that are no longer useful or efficient. The idea that the office is a specific

place where our professional lives happen is becoming less universal, and less important. These days’ people can

be productive anywhere.

The tech industry is expected to increase in office take-up, with Google, Snapchat, Facebook, Amazon Web

Services and Twitter already located. While the tech industry is not yet a major engine of growth or take up in

overall GDP terms, Dubai has emerged as a regional hub for a range of sectors, including aviation, financial

services, hospitality and media.

With the largest demographic of the population being 30-34 years old, Dubai offers access to a vibrant and well-

educated pool of talent. This generation has specific expectations about technology in the workplace. They expect

it to be a catalyst for innovation, as well as a major avenue of communication on the job. A recent survey by PwC

noted:

• 59 per cent of those surveyed said an employer’s provision of state-of-the art technology was important to them

when considering a job; and

• 78 per cent said access to the technology they like to use makes them more effective at work.

Tecom zone and the DIFC maintain high rental levels as occupancy remain strong; Their free zone status, quality

of space, the developed surrounding infrastructure and proximity to amenities continue to work in their favour.

The DIFC could witness growth in new companies setting up, offering blockchain and Fintech services.

However, competition will remain fierce as these companies are also being targeted by entities such as the ADGM

in Abu Dhabi and Bahrain.

There is a long way to go in this sector’s evolution, but with overall market confidence remaining stable in Q1-17,

this will help in the recovery of the core occupier market. But to witness a change in the quality and delivery of






commercial office space, there will be a need for international investors to be attracted to Dubai. And with this,

there is a need to adapt to changing occupier demand dynamics before being comfortable entering the market.

What implications could the tech movement have on real estate?

With increased pressure on the economy and businesses, many CEOs are scrambling to find innovative ways to

reduce costs. One way in which to do this is by selectively introducing virtual offices as an option for employees.

Virtual offices are becoming more popular mainly because of the shift towards output based performance

assessment. The traditional perception of work being a place to go to is fast being replaced by the idea that

employees are responsible for achieving specific objectives in the most efficient manner.

Source: Gulf News

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PROPERTY PRICES GO WITH THE FLOW

ALONG DUBAI CANAL Wednesday, July 5, 2017

The deals on off-plan properties in Dubai is stretching all the way up the Water Canal. A developer is offering units

at its 24-storey high-rise as being the “lowest price per square foot in this area (Business Bay)”.

The Elite Business Bay now has units priced at an average Dh1,192 per square foot, which the developer says

compares more than favourably with those of the immediate competition’s Dh1,278 psf. A high-end unit at a

tower in the immediate location is currently at Dh2, 500 psf plus.

“Until now many of the projects located here (at Business Bay) have been marketed and sold as luxury homes

with a price tag to match,” said Juwaad Beg, Chairman of Elite City Real Estate. “This may be part of the reason for

a slowdown in demand for Business Bay (based) projects.” (The Elite unit is scheduled for a late 2019 completion.

The apartments range from 410 square feet to 2,200.) According to Beg, “We designed the building so that all

apartments will have partial or full views of the Canal. We will be making it possible for those who probably

couldn’t afford to purchase in such a prominent location.”

Prices for the units start from Dh625, 000 for a studio to Dh2.93 million for a two-bedroom. And, as is becoming

the new norm in off-plan launches, a 50:50 payment plan is available on select apartments.

“The development of the Water Canal will increase demand for this area,” said Beg.

Elite’s past development activity until now been largely confined to Dubai Sports City, where it has delivered nine

and the next one to be ready by the end of this year.

Source: Gulf News

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LOOK: DUBAI VILLAS SURROUNDED BY

FOREST Wednesday, July 5, 2017

With the arid desert climate, people in the UAE can only dream of having a house surrounded by lush greenery,

vibrant gardens and nature. But a developer is currently building a new community to help that dream come to

life.

Sobha Group has recently unveiled its mega project that seeks to build luxury villas set in the middle of a forest

with views of the Dubai Canal and within easy distance from Dubai’s attractions, including the Burj Khalifa,

Meydan Mall and Downtown Dubai.

With a hefty price tag ranging between Dh11.1 million and Dh15.42 million, the forest villas will be in a resort-style

community called Sobha Hartland.

SobhaIt is situated along the site of the Dubai Canal extension in Nad Al Sheba 1 near Meydan and will be

surrounded by 2.4 million square feet of real trees, greenery, grass and flowers.

Work on the project is already ongoing and so far, two villas are ready and available for viewing, according to the

developer. Those who are interested can book a VIP tour with exclusive chauffer service.

The project is currently attracting a lot of investor interest, with more than 70 per cent of phase one and two

already sold out, while phase three has recently been launched.

According to PNC Menon, founder and chairman of Sobha Group, there is a demand for luxurious and large villas

in the centre of town. “We have designed these exquisite villas keeping in mind each type of lifestyle, investment

preference and purpose as there are both multiple options of layouts and sizes.”

“Thirty per cent of the whole project is dedicated to greenery. [We also offer] investors the choice of customising

their villas with new facades, colours and a fancier garage parking as per their taste and preference,” said Menon.

The first phase of the project will have 48 villas, expected to be completed in December 2018.

The starting price for a four-bedroom villa is Dh11.1 million and for a five-bedroom villa is Dh15.42 million

upwards.

Source: Gulf News

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NEW DH5B TOWER COMPLEX PROJECT

UNVEILED IN DUBAI Tuesday, July 4, 2017

A Dh5 billion tower complex was launched on Tuesday by His Highness Shaikh Mohammad Bin Rashid Al

Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai.

The Emirates Tower Business Park will add a value to the business environment in the emirate and offers a wide

variety of top class office spaces for international companies that aspire to move their regional headquarters to

Dubai.

The project is expected to be completed in four years and will be located in the area between Shaikh Zayed Road

and Happiness Road, near Dubai World Trade Centre.

Two covered footbridges linking the project to Dubai International Financial Centre (DIFC) will also be built.

“The grand urban development projects which are being implemented across the UAE will strengthen our

development strategy in various sectors and support our preparations for the future as part of the overall

prosperity being experienced by the country under the leadership of President His Highness Shaikh Khalifa Bin

Zayed Al Nahyan,” said Shaikh Mohammad.

The park will also house three five-star luxury hotels.

A hotel will be managed by Jumeirah Group, while the other two will be managed by leading global hospitality

companies. It will include retail spaces for international brands, and a chain of restaurants and cafes. There will be

a central area designated for events, in addition to the availability of public areas and parks, and facilities to serve

businesses and companies.

“With a clear vision for the future and its requirements, our country continues its approach to lay the ground an

appropriate environment that ensures opportunities for growth for private corporations and establishments by

providing them with innovative solutions that meet the aspirations of investors,” added the Vice President.

Accompanied by Shaikh Maktoum Bin Mohammad Bin Rashid Al Maktoum, Deputy Ruler of Dubai and Chairman

of DIFC, Shaikh Mohammad viewed the project model and blueprints, and listened to a presentation by Abdullah

Ahmad Al Habbai, Chairman of Dubai Holding, on the project’s components and facilities.

Al Habbai said that this is yet another project that reaffirms Dubai’s international stature as a favoured

destination for regional and international companies that look forward to tapping into promising opportunities

and achieving growth in new markets.

Source: Gulf News

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NEW DUBAI REAL ESTATE CORP BOARD

UNVEILED Tuesday, July 4, 2017

His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE, in his

capacity as Ruler of Dubai, issued Decree No 24 of 2017 that sets up the new board of the Dubai Real Estate

Corporation (DREC). According to the decree, Shaikh Maktoum Bin Mohammad Bin Rashid Al Maktoum, Deputy

Ruler of Dubai, will chair the new board. The DREC board also includes Hisham Abdullah Al Qassim as vice-

chairman; and members Sami Ahmad Al Qamzi; Abdullah Ahmad Al Habbai, Mohammad Hamad Obaid Al Shehi,

Rashid Mohammad Rashid Al Mutawa, Shuaib Mier Hashim Khori, and Mohammad Hadi Ahmad Al Hussaini.

The board serves for a renewable term of three years. This decree comes into effect from July 18, 2017, and will

be published in the Official Gazette.

Source: Gulf News

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RIDE ALONG: NAKHEEL OPENS MONORAIL

STATION ON THE PALM Monday, July 3, 2017

Residents and visitors at The Palm Jumeirah will now have better public transportation service, with one major

station just opening up.

The facility provides easy access to residents at the Golden Mile and Shoreline Apartments, some of the popular

residential locations at the man-made island. It is also within easy reach of the Golden Mile Galleria mall and Palm

Jumeirah’s central park.

“Passengers using The Palm Monorail in Dubai can now board and alight at the newly-opened Al Ittihad Park

station for easy access to Palm Jumeirah’s central park, thousands of residences [among others],” Nakheel said in

a statement issued on Monday. The monorail spans along the trunk of The Palm and connects the island with

Dubai mainland. It opened on 30th April 2009, mainly transporting passengers who visit the Atlantis hotel.

The property developer said that around a million people already use the public transportation system every

year.

The number of users is expected to increase, with more attractions on the island scheduled to open up soon.

In May, Nakheel signed a construction contract worth Dh1.5 billion for The Palm Gateway, a new three-tower

residential, retail and beach club complex.

More stops

Nakheel is working on a number of developments, including the Nakheel Mall and The Pointe, both of which will

have their own monorail stop.

“The Palm Monorail is one of Palm Jumeirah’s biggest success stories. The opening of Al Ittihad Park Station is a

massive boost for the island’s investors, residents, visitors and retailers, and further cements our commitment to

providing new services and attractions at this world-famous community,” said Nakheel chairman Ali Rashid

Lootah.

“More people than ever can now enjoy the growing number of facilities on Palm Jumeirah – without using a car to

reach them.”

Source: Gulf News

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DUBAI HOMES: LIVE-IN THE DREAM Wednesday, July 5, 2017

The Dubai property market has shifted from being mainly investor-led to a more mature end-user dominated

market. A strong US dollar and weak oil prices are making Dubai property more expensive to investors from

traditional source markets such as Russia, the UK and China.

Consider this. In July 2014, a dollar cost you 37 Russian rouble. In 2017, the same dollar costs 57 Russian rouble.

In July 2014, a dollar would cost you 0.58 British pounds. In 2017, the same dollar costs 0.77 British pounds. In July

2014, a barrel of oil cost $115. In 2017, a barrel of oil costs $47.

"Russians were dominant investors of Dubai real estate prior to mid-2014 and are now virtually non-existent. UK

investors were always active in the Dubai real estate market but since Brexit have been either dormant or have

repatriated funds to the UK. Our oil-rich neighbours are currently taking stock while prices are low and are

reluctant to invest in real estate to the same level as before," says Lukman Hajje, chief commercial officer,

Propertyfinder Group.

Most real estate investments in the UAE in 2016 came from nationals of the UAE, India, Saudi Arabia, Pakistan,

Egypt and Iran.

Meanwhile, there has been an increase in the number of end-users, first-time buyers in particular, entering the

market encouraged by lower prices. Innovative payment plans by developers and the creative packaging of

mortgage products by some banks have helped this trend.

"We believe that a major portion of real estate buyers are end-users, particularly at a time when rental costs

match or perhaps are less than mortgage re-payments," says Haider Tuaima, research manager, ValuStrat.

The dollar will weaken at some point and most experts predict oil prices to settle above $60 per barrel. If these

factors occur simultaneously, investors will re-enter the market, and as a consequence house prices will rise.

"In general, a weak dollar is positive for the UAE real estate market. Oil prices reaching above $60 a barrel are still

some way to go. When it happens, the overall positive impact it will have on the economy of UAE and the wider

GCC will benefit the UAE property market greatly," says Sathya Srinivasan, head of strategic consulting and

research at Cavendish Maxwell.

However, recent movements in the US dollar are too narrow to have an impact on USD-affected private buyers.

Residential property prices are still under downward pressure in Dubai. End-users can use soft prices to join the

property ownership bandwagon.

According to Propertyfinder, Downtown, Jumeirah Village Triangle, Jumeirah Beach Residence and Culture Village

have seen the biggest price declines for apartments. On the contrary, apartments in Jumeirah Village Circle (JVC),

Dubai Sports City, Business Bay, Al Furjan and International City witnessed price increases.

International City at Dh718 per square foot still offers Dubai's most affordable apartments; at Dh2,182 per square

foot, Downtown is Dubai's most expensive apartment community.

If you are looking to buy a villa, consider up-and-coming communities such as Mudon and Dubailand where prices

are gradually escalating. Villas in Jumeirah Golf Estates, Jumeirah Park, Dubai Sports City and the Meadows saw

notable price declines. Emirates Hills and Palm Jumeirah continue to demand prices above Dh2,500 per square

foot and remain Dubai's most expensive. JVC asks just Dh754 per square foot and remains Dubai's most

affordable villa community.






Momentum in property transaction levels is expected to pick up in the last quarter.

"The fast-approaching Expo will help to continue this trend beyond the end of the year. If this forecast holds good,

we can expect to see house prices going up in sections of the market over the next few quarters, leading into

2018 and beyond," adds Srinivasan.

The Expo effect is likely a consideration for some recent buyers on the southwestern side of Dubai, particularly

those investing in off-plan launches near the Expo site, says ValuStrat's Tuaima. "More generally, some parties feel

we need to be a little closer to 2020 before a positive impact is felt in the wider real estate market," he concludes.


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SHORT ON DOWN PAYMENT TO FINANCE

YOUR PROPERTY IN DUBAI? Tuesday, July 4, 2017

Since the implementation of the UAE Central Bank's mortgage cap in 2013, buying a property has become harder.

The mortgage cap required buyers to put down larger deposits against new purchases. This has had a big impact

on first time buyers but as expected had a minimal or negligible impact for most affluent or high net worth

individuals.

In the UAE, the maximum loan to value (LTV) for expatriates is 75 per cent, providing it is a first mortgage and the

property is valued under Dh5 million. For purchases higher than Dh5 million, the LTV reduces to 65 per cent and

60 per cent for all subsequent purchases. Therefore, a first time buyer has to find 25 per cent down payment plus

an estimated percent of the value of the property to cover all fees for the transaction; a tough amount to swallow

for many prospective buyers.

So, what can you do when you need to come up with funds to complete your purchase?

Leverage existing property

An excellent way of making your assets work harder for you is to have property you own locally or internationally

with little or no mortgage refinanced to release cash to fund your down payment. For example, if you have a

property in the US, which is tenanted, while you are working overseas, you can secure a USD or AED mortgage up

to 75 per cent of the value of the property and repatriate the funds to the UAE to use as deposit. An additional

UAE mortgage can then be taken against the new purchase, which is then funded by both mortgages. This is

acceptable, subject to the buyer's affordability.

Always make sure to check with your bank or mortgage consultant before taking this route as you need to be

mindful that some UAE banks and lenders will not accept equity released funds from an existing property as

down payment. These banks have interpreted the UAE Central Bank mortgage regulations differently to others.

Leverage against cash or investments

Private banking arrangements is a strategy used by high net worth clientele to finance property. Many expats

choose to maintain wealth offshore in financial services jurisdictions, such as Switzerland or the Channel Islands.

While interest rates remain low, it can be beneficial to borrow against a portfolio of stocks and shares or bonds,

which offer the potential to outperform the cost of borrowing. For example, a conservative investment portfolio

may offer modest returns of five to six per cent per annum, while borrowing costs are below two per cent.

No personal loans for down payments

The regulations for the above are clear: Neither borrowers nor banks should engage in the provision or

acceptance of personal loans to be used as down payment. The reason for this is that it is very different to

borrowing against a property (collateral). Personal loans are unsecured debt and if they are used for a loan, there

is no security or collateral at stake that will ensure that the loan is repaid. Personal loan repayments are restricted

to a maximum term of 48 months in the UAE, so the monthly repayments are much higher over the shorter

period than borrowing the same amount over the term of a 25-year mortgage. Consequently, greater risk and

shorter repayment periods mean that personal loans attract higher interest rates. They are not transparent and

the actual interest paid over the term is much higher than interest calculated on a reducing balance basis.






Personal loan okay to pay other fees

Although personal loans are not allowed to be used as down payments, they can be used to pay the estimated

seven per cent transaction or purchase costs. In Dubai, the costs for buying a freehold property are: two per cent

real estate broker fee, four per cent Dubai Land Department transfer fee, 0.25 per cent mortgage registration fee,

Dh4, 000 registration trustee office and bank fees, which vary from bank to bank. These can be financed via

personal loan, providing the buyer is eligible and has the down payment from saving.

In summary, there are likely to be different avenues available to get extra money to be able to finance your dream

purchase but always follow the simple rule of thumb - only invest in and purchase a property that is affordable.


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RISING SCHOOL FEES HIT DEMAND FOR

LARGER HOMES IN UAE Wednesday, July 5, 2017

It's around this time every year as schools close for the long summer holidays that scores of expat families pack

up and leave the UAE permanently. The flow of new residents arriving and ex-residents departing is a constant of

life in a country in which foreigners make up most of the workforce. But check your Facebook feed and other

social media and there appears to be anecdotal evidence to suggest the exodus of families is gathering pace and

that there is usually one common factor mentioned in all those goodbye posts: the high cost of education.

Dubai's private schools have received government permission to raise fees for 2017-18 by up to 4.8 per cent,

Khaleej Times reported in February, with hikes dependent on school performance. The latest increases mean that

fees could have risen by as much as 30 per cent since 2011-12, as per media reports. Educational costs account

for a big chunk of expat family incomes and the steady increases in fees have diminished the attractiveness of the

UAE for foreign workers with children. In turn, that is dampening demand for property, particularly larger

apartments and villas.

Unlike healthcare insurance, which is now mandatory for all employees, expat packages rarely include schooling

allowances and full healthcare benefits for dependents. For workers from the likes of Europe and Australasia,

where high-quality education and medical cover is free, the benefits of a tax-free salary may now fail to cover

these extra costs incurred from living in the UAE, prompting some to consider returning home. As well as hitting

demand for larger properties, the school fee effect is also spurring highly-paid parents to rent rather than buy - it

seems many are less willing to commit to the UAE for the long term, with school fees increasing as a child gets

older.

While school fees appear to be rising ever upward, UAE residents have benefitted from a steady decline in rents

from mid-to-late 2014, which should have eased the burden on families. Developers have responded to demand

from budget-conscious families seeking to rent or buy, with several affordable developments launched or handed

over in the past couple of years. Damac's Akoya, Emaar's Reem and Dubai Properties' Mudon, all located in

Dubai's periphery near the E611 road, have provided families with cheaper alternatives.

These developments usually include essential facilities such as primary schools, but often these open only after

the project is well-established and most properties are occupied. For those families among the first to move in,

the nearest school is a long car or bus ride away, while generally good schools can impact demand and prices for

nearby property.

Even with the government linking fee rises to school performance, there is undoubtedly some scepticism among

parents as to the quality and value for money that UAE schooling provides. While the top schools have excellent

reputations, the fees are dizzying and some charge just for a child to be put on the waiting list for a place. The

UAE's robust economy and the spending power of the dollar-pegged dirham should ensure it remains an

attractive proposition for thousands of expat families, but the onerous cost of education is a problem that policy

makers must tackle in the long term to ensure the country maintains its competitiveness in attracting global

talent.


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VILLA AT EMIRATES HILLS FETCHES DH90M Thursday, July 6, 2017

Big-ticket property deals are becoming a norm in Dubai, the city known as the sought-after residence destination

of the world's super rich, if the transactions over April-May are any indication.

Dubai has witnessed transactions of several super luxury villas and apartment with price for a 25,812 sqft villa in

Emirates Hills fetching Dh90 million in May.

While villas in Emirates Hills remained the top choice for the super-rich, Palm Jumeirah was close behind with a

7,762 sqft villa selling for Dh84.2 million in April, according to the estate agency Luxhabitat.

In apartment’s category, most priced transactions were recorded in Dubai Marina, Palm Jumeirah and Culture

Village during the second quarter. The most expensive apartment transaction was for a Dubai Marina property

measuring 14,349 square feet for almost Dh30 million.

On analysis of data by Reidin, Luxhabitat, a high-end real estate company focused on marketing, selling and

designing high-end real estate properties in the region, said Dubai's secondary prime residential market saw an

upturn in second quarter due to an increase in transaction volume by four per cent in comparison to first quarter.

According to Luxhabitat, the prime residential market is composed of properties that lie on the high end

spectrum of the Dubai residential market. Luxhabitat recognises 12 key areas that form part of this classification;

the areas are Al Barari, Arabian Ranches, Downtown Dubai, Dubai Marina, Emirates Hills, Jumeirah, Jumeirah

Beach Residence, Jumeirah Golf Estates, Jumeirah Islands, Jumeirah Lakes Towers, Palm Jumeirah, The Lakes,

Springs and Meadows, & Victory Heights. "Overall, we are seeing a flattening of price evolution. As of second

quarter, the price/sqft for prime residences are Dh1, 482 per sqft," said Jason Hayes, managing director of

Luxhabitat. The prices are at similar levels as of fourth quarter 2015. An upward trend was observed from third

quarter in 2016 and since then, the prices are steadily rising.

The total volume of transactions in second quarter 2017 was Dh3.6 billion. "There seems to be an increase in

interest for buying villas in these prime areas; there was a seven per cent increase in volume of transactions per

villa from the previous quarter," said Hayes.

Almost 62 per cent of the total volume of transactions in second quarter were for apartments, with the Palm

Jumeirah transacting approximately Dh771 million, followed by Dubai Marina (Dh667 million) and Downtown

Dubai (D 340 million).

"I am delighted with second quarter results that clearly reflect the ongoing positivity and confidence in the

market," said Hayes.


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DUBAI'S TAMWEEL TOWER RESIDENTS HIT

WITH OUTSTANDING SERVICE CHARGES Sunday, July 2, 2017

Residents of the fire-hit Tamweel Tower in Dubai will be able to return home next month after official documents

are signed – but they have been ordered to pay outstanding service charges first.

Sources told Arabian Business that some residents are liable for service charge bills worth tens of thousands of

dirhams, as expenses have been incurred even while the building has been empty.

The 34-storey residential tower in Jumeirah Lakes Towers (JLT) was engulfed in flames in November 2012, but

repair work did not complete until June 2016 and residents have claimed they have been in limbo, unable to

return to their homes.

Arabian Business reported in May that a key document had been submitted to the authorities to give the building

the all-clear for occupation later this summer.

Sources say the building has since been handed over and residents will be able to return home in July, pending

completion of final documentation.

However, some owners have not paid service charges while the building has been empty and are being hit with

hefty bills.

One owner-occupier told Arabian Business: “We have been informed that the building has been fixed and are

waiting to hear when we’ll be able to move back in.

“However, I have received a bill for AED25, 000 ($6,800) for retrospective service charges for the past three years

even though my apartment has been uninhabitable.

“It is not fair that I should have to fork out this money, even though I have not been able to live in my property.”

Another source confirmed that residents have been asked to pay outstanding service charges before moving back

in, but insisted the costs have been minimal since the fire.

The charges comprise basic plumbing and electricity costs, community charges imposed by JLT free zone

authority Dubai Multi Commodities Centre (DMCC), cooling charges by Empower and other basic maintenance

costs necessary while repair work has been ongoing, the source said.

The source added that service charges are dependent on the size of the property, but average around AED15-18

per square foot (/sq ft) during normal occupation. The average cost has dropped to around AED7/sq ft while the

building has been empty.

“You can’t simply walk away from the building,” the source said. “There are some people who have been paying

every year since the fire, while others have chosen not to, believing they would not be liable. Why should some

pay and not others?”

The source added that the service charge issue had been addressed “multiple times” at tenants association

meetings since the fire.

Masoud Nayebi, chairman of the Tamweel Tower Residents Association, which is responsible for the upkeep of

the tower and has been the ‘go-between’ for residents and insurance firms since the fire, confirmed: “The owners

who have not yet paid their service charges have to settle them before they move [back] in to the tower.”






Nayebi explained: “Though the building has been vacant for about five years, in order to save it from deteriorating

we had to incur expense to maintain it. Obviously the expenses had to be approved by RERA (Dubai’s Real Estate

Regulatory Agency) before charging to the owners.

“Some of the expenses, like DEWA, cooling consumption and security, were taken over by the insurers once the

tower was handed to them two years ago [to oversee repair work].

“But other expenses like the community service charge, Empower demand charge, insurance, building manager

fee etcetera have been paid for by the association board, which is elected by the owners, and collects service

charges from them.

“[Some owners] have certainly received yearly invoices when they have been issued based on the budget

approved by RERA, but decided not pay.

“There have been other owners who have dutifully and enthusiastically been paying their yearly service charge.”

Source: Arabian Business

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SHEIKH MOHAMMED UNVEILS DH5BN

EMIRATES TOWERS BUSINESS PARK Wednesday, July 5, 2017

Vice President and Prime Minister of the UAE and Ruler of Dubai His Highness Sheikh Mohammed bin Rashid Al

Maktoum said that Dubai’s major real estate projects aim to enhance the emirate’s development across sectors,

and enhance its readiness for the future as part of the comprehensive growth strategy of the UAE under the

leadership of UAE President His Highness Sheikh Khalifa bin Zayed Al Nahyan.

Sheikh Mohammed also said that these projects represent the next phase of strategic development of

infrastructure that is required for the UAE to meet its growth aspirations. He said these projects are helping the

country cement its position as a destination of choice for global investment.

His Highness said that the UAE is continuing its drive to enhance the environment for businesses and the private

sector by providing innovative solutions for investors’ needs, and create a platform in the UAE for businesses to

access major emerging markets that together have a population of over 2 billion people.

Sheikh Mohammed made these remarks at the launch of the AED5 billion Emirates Towers Business Park project.

His Highness was accompanied by Deputy Ruler of Dubai and President of Dubai International Financial Centre

H.H. Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum.

The launch was held in the presence of President of Dubai Civil Aviation Authority and CEO and Chairman of the

Emirates Group H.H. Sheikh Ahmed bin Saeed Al Maktoum; H.H. Sheikh Mansour bin Mohammed bin Rashid Al

Maktoum; and Director-General of the Department of Protocol and Hospitality in Dubai Khalifa Saeed Suleiman

and a number of senior officials of Dubai Holding.

Chairman of Dubai Holding Abdulla Ahmed Al Habbai briefed His Highness about the development and various

components of the project.

Masterplanned by Dubai Holding, the development is located between Sheikh Zayed Road and Happiness Street;

in close proximity to Dubai International Financial Centre (DIFC), the leading financial hub for the Middle East,

Africa and South Asia (MEASA) region. Upon completion, Emirates Towers Business Park will become an

integrated business district in the heart of Dubai’s financial district and will provide a legislative environment with

international standards of governance and transparency under the regulations of the DIFC Authority.

The development is the result of mutual collaboration between Dubai Holding and DIFC in response to the

increasing demand from international corporations looking to set base in Dubai’s thriving business environment.

The emirate’s strategic location and advanced infrastructure presents the ideal choice for companies looking to

strengthen their presence in the region and expand their reach.

Emirates Towers Business Park will meet the increasing demand for Grade A office space through hi- and low-rise

office towers catering to a range of requirements. The development will include three five-star hotels. Jumeirah

Group will manage one, while the other two will be managed by leading international hospitality groups. The

development will also offer retail space with a range of international brands and F&B options, a dedicated arena

for events and ancillary facilities to support corporates. The development will be interspersed with public parks,

green space and will include two covered pedestrian bridges connecting to the DIFC.






To ensure ease of access across the development, Emirates Towers Business Park will be supported through a

three-level basement with one level dedicated to traffic management, while the other two will provide 13,000 new

parking spaces.

Commenting on this launch, Abdulla Al Habbai, Chairman of Dubai Holding, said: "This new development reflects

the wise and ambitious vision of our leadership and is in line with Dubai’s strategy of developing futuristic

projects to meet the growing demand for integrated business districts and advanced legal infrastructure built on

international standards of governance and transparency.

Emirates Towers Business Park demonstrates Dubai Holding’s commitment to the economic diversification of

Dubai and strengthening its attractiveness as a preferred destination for regional and international corporates

looking to leverage the wealth of opportunities for growth and expansion."

Essa Kazim, Governor of Dubai International Financial Centre, said: "DIFC continues to deliver on its ambitious

plans to support the growth strategy of Dubai and the ongoing economic development of the UAE. Our

collaboration with Dubai Holding is a perfect example of this strategy in action. By extending DIFC’s jurisdiction,

the member companies of Emirates Towers Business Park will benefit from the Centre’s robust legal and

regulatory framework as well as its world-class infrastructure that supports business growth throughout the

MEASA region."

"It is our pleasure to work closely with Dubai Holding on this exciting development, which brings us a step closer

towards our stated objective to triple the size of DIFC by 2024," he added.

The location will host the Museum of the Future, which offers laboratories for innovation in different sectors,

including health, education, smart cities, energy, and transportation. Construction on this latest addition to

Dubai’s skyline will commence by the end of 2017 with completion aimed within four years.

Source: Emirates 24/7

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DUBAI DEVELOPER AZIZI BEGINS WORK ON

DHS12BN RIVIERA PROJECT IN MBR CITY Thursday, July 6, 2017

Dubai-based Azizi Developments has begun construction on its Dhs12bn mega project Azizi Riviera in Mohammed

Bin Rashid Al Maktoum City, the developer announced on Thursday.

The waterfront project, located on the banks of the Dubai Canal, is being developed by KCC Engineering and

Construction and Actco General Constructing.

Situated within the Meydan One project, Azizi Riviera comprises of 69 mid-rise residential buildings, a retail

district and two hotels.

In terms of residences, the development will offer 13,000 units including one-bedroom, two-bedroom and studio

apartments.

Meanwhile the integrated retail district will consist of high street bridge brands, leisure and entertainment

options. The overall development will also offer access to long paved pedestrian paths and water transport,

yachting facilities and a proposed marina.

The two hotels will include one four-star and one five-star property, a statement said, without disclosing the

names of the operators.

Designed to resemble the French Riviera waterfront, the development will also offer access to the Meydan One

Mall and the Meydan Racecourse – where the Dubai World Cup is held.

The first two phases are slated for completion in December 2018, Azizi confirmed.

Azizi Riviera is the first in a series of projects that Azizi is planning to develop in the Meydan One mega-

development, following a partnership with Meydan Group announced earlier this year.

The wider Meydan One development will feature the 711 metres-tall Dubai One Tower, Meydan One Mall, a five-

star hotel, a civic plaza with dancing water fountains, an indoor sports facility, a 4km canal and a marina.

It is expected to house more than 83,000 residents when complete.

Work on the Meydan One Mall began in March this year, and when ready, it will have the world’s longest indoor

ski slope, a 131,150 sq ft hypermarket and a retractable skylight roof. It will also host 620 retail shops, with two

major department stores and regional firsts, 100 food and beverage outlets and a 21-screen cinema with a food

court.

Source: Gulf Business

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DEWA AWARDS DH46M CONTRACT FOR

PHASE 1 OF AL-SHERAA BUILDING Saturday, July 8, 2017

Dubai Electricity and Water Authority, DEWA, has awarded a Dh46 million contract for the first phase of the

construction of its new headquarters, called Al-Sheraa, to Dutco Balfour Beatty, who offered the lowest bid and

competed with 10 leading international companies.

The contract for Phase 1 includes shoring, dewatering, excavation, and piling, fencing and associated works.

Al-Sheraa is the tallest, largest, and smartest government net Zero Energy Building, ZEB, in the world. It will have

over 2 million square feet, covering over 200,000 square feet of land in the heart of the Cultural Village in Al Jadaf.

The building will have 16,500 square metres of photovoltaic solar panels on the roof to produce over 3,500

kilowatts (kW). The building will also include an additional 2,000 square metres of building-integrated photovoltaic

panels. The total renewable energy generated from the building is over 5,800 megawatt hours (MWh) per year.

The building will be completed and inaugurated in the last quarter of 2019.

Source: Gulf News

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RECORD INDICATOR FOR CONSTRUCTION

COSTS UP 0.06 PERCENT IN DUBAI IN 2016 Saturday, July 8, 2017

A report by the Dubai Statistics Centre, DSC, has revealed an increase in the general record number for

construction costs during the year 2016 to 100.66 — 0.06 per cent up from 100.60 in 2015.

The report attributed the growth to an increase in the record number of raw material from 98.73 in 2015 to 98.96

in 2016 and a price rise in the building material which was up 0.23 per cent. In the meantime, the record number

for equipment and labour and other costs declined 0.19 per cent from 103.41 in 2015 to 103.22 in 2016.

Construction raw material slightly increased by 0.23 per cent in 2016 on the back of a 11.23 per cent price hike in

quarry materials, with process industries material prices edging down by 0.27 per cent. According to the report,

residential building raw material edged up 0.31 per cent while non-residential building material got down by 0.10

per cent. Quarry raw material soared high by 11.63 per cent as a result of a significant in the prices of stone, sand

and gravel leading to a similar increase in the prices of residential and non-residential prices.

The fluctuations in the prices of process industries materials upwards and downwards contributed to limiting the

decline in the index for this category which decreased by 0.27 per cent, with the prices of refined petroleum

products dropping sharply by 32.89 and the price of basic metal products such as construction iron and

aluminium products falling by 7.04 per cent. Furniture prices got down by 3.18 per cent, computers and

electronics and optical products by 2.79 per cent, equipment and other instruments such as faucets and spigots

by 1.46 per cent with chemical products edging down by 1.27 per cent, wood products barring furniture by 1.00

per cent with other non-metal products, including cement and its products by 0.37 per cent.

In the meantime, the price index for electrical equipment including prices of electronic and electric cables

increased by 6.09 per cent, while the prices of rubber products and plastics rose by 2.94 per cent, and prices of

metal vessels and tanks by 2.62 per cent. The drop in the prices of refined petroleum products like engines fuels

and liquid fuels led to a drop in the index for this section by 32.89 per cent as a result of the drop in the diesel

prices by 32.89 per cent; it is worth noting that the change in the index was equal for all types of building with a

percentage of 32.89. The price index for chemicals and chemical products dropped by 1.27 per cent as a result of

the drop in the price of all the materials in this section where the price of the materials listed under paints, polish

and varnish dropped by 1.27 per cent and the impact of the change in the prices was equal for all types of

buildings and reached 1.27 per cent.

The price index for rubber and plastics rose by 2.94 pe cent as a result of the increase in the prices of plastic

products such as pipes, hoses and hose connectors by 3.71 per cent and the prices of other rubber products

declined by 2.70 per cent. Upon studying the report, it was found that the prices of rubber and plastic products

for non-residential buildings rose by 3.27 per cent while the prices for residential buildings rose by 2.77 per cent.

The price index for other non-metal products rose by 2.94 per cent due to the increase in the prices of plastic

products, including plastic pipes and hoses and their connections by 3.71 per cent, with other plastic products

decreasing by 2.70 per cent. The price index for non-metal products decreased by 0.37 per cent due to a 3.55 per

cent drop in the prices of stones, marble and alabaster.

Source: Gulf News

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AZIZI BEGINS WORK ON DH12B RIVIERA

PROJECT IN MBR CITY Thursday, July 6, 2017

Azizi Developments has started construction works on Azizi Riviera, a Dh12-billion project in Mohammad Bin

Rashid Al Maktoum City.

The project will be implemented within the Meydan One project, and will be located near Dubai Water Canal. It

includes 69 mid-rise residential buildings, a retail district, as well as one four-star and one five-star hotel. The first

and second phase of the project is expected to be completed in December 2018.

The ceremony laying down the foundation stone of the project was attended by Saeed Humaid Al Tayer,

Chairman and CEO of Meydan Group, and Mirwais Aziz, Chairman of Azizi Group.

Source: Gulf News

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ARABTEC’S TARGET LANDS FOUR

CONTRACTS WORTH DH289M Wednesday, July 5, 2017

Arabtec has announced that its specialist oil & gas and infrastructure arm, Target Engineering Construction

Company (Target), has won four new contracts worth a combined Dh289 million.

The company said that the projects include work on a high-rise development in Dubai’s Business Bay, the

installation of industrial process tanks in Taweelah, Abu Dhabi, substation upgrades at Das Island in Abu Dhabi,

and a cofferdam removal and revetment construction in the Western Region.

“Target Engineering over the years has developed a strong experienced workforce, solid financial standing, and

evolved into a key player within the region with core capabilities of delivering complex projects in the industrial oil

& gas, social infrastructure, marine and high-rise tower sectors,” said Chaouci Yassine, the chief executive of

Target Engineering.

He added that the new awards demonstrated the firm’s range of expertise.

The Arabtec Holding chief executive, Hamish Tyrwhitt, added: “Target, together with the Group’s other operating

entities, demonstrates our integrated capabilities but also our core strength, giving us the ability to pursue a

broad range of projects. We continue to focus on the UAE as our core market and are optimistic on the outlook of

the sector.”

Arabtec has recently completed a share recapitalisation, which has included a Dh1.5 billion rights issue, injecting

new capital into the business and writing off about Dh4.6bn of historic losses with a view to supporting a

turnaround plan for the business drawn up by Mr Tyrwhitt and his management team. The plan focuses on its

three main operating divisions:Target; Arabtec Construction; and the MEP (mechanical, electrical and plumbing)

contractor Efeco - as well as divesting non-core businesses and recovering historic debts.

Target is the third of these three businesses to announce contract wins over the past three days. On Tuesday,

Arabtec announced that its construction arm had secured a Dh353m contract to build the UAE Pavilion at the

Expo 2020 site in Dubai, while Efeco said on Monday that it had secured a Dh113m deal to carry out MEP works at

two 37-storey residential towers at Emaar Properties’ Dubai Creek Harbour project.


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SOROUH PROFITS UP 75% Wednesday, July 5, 2017

Sorouh Real Estate, one of Abu Dhabi's largest developers, yesterday reported a 75 per cent surge in net profits

for the first half of the year. The company said profits grew from Dh556 million (US$154m) in the first half of last

year to Dh977m this year. Revenue growth from land sales and rents drove the rise in profits, the company said.

"This is another positive financial performance for Sorouh, marking continued progress in our development as

one of the leading real estate developers in the region," said Abubaker Seddiq al Khouri, the managing director at

Sorouh.

The cornerstone of Sorouh's property portfolio is Reem Island, a development spanning 6.33 million hectares off

Abu Dhabi's northeastern coast. The company is building a massive complex of skyscrapers, apartments and

parks there estimated to be worth upwards of Dh91.8 billion. Sorouh, a public company with 55 per cent of its

equity listed on the Abu Dhabi Securities Exchange, announced recently that it would attempt to raise Dh4bn in a

securitised sukuk to help fund its ambitions.

The company said yesterday that the bond would be divided into three tranches with varying seniority - bonds

with higher seniority have first claim on assets in case of default - and priced accordingly. The Class A tranche

worth Dh2.761bn would yield two per cent above the one-month Emirates Interbank Offered Rate (Eibor), Sorouh

said. The less-protected class B tranche, worth Dh251m, would yield 2.5 per cent above the one-month Eibor. And

the class C tranche, worth Dh1.004bn, would yield 3.5 per cent above one-month Eibor, compensating investors

for a lower priority claim on assets in a default.


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ADIA TARGETS EMERGING MARKETS AS

LONG-TERM GAINS SLOW Tuesday, July 4, 2017

The Abu Dhabi Investment Authority, one of the world's largest sovereign wealth funds, has pinned its hopes on

emerging markets for the next ten years, after registering a second consecutive annual drop in its long-term

gains.

"Economic growth in the decade ahead will be dominated by the emerging world," Sheikh Hamed bin Zayed Al

Nahyan, Adia's managing director, said in the fund's annual review, published on Tuesday.

"We expect that over two-thirds of the growth in global GDP over the coming ten years will come from those

emerging economies; with roughly half coming from China and India alone."

Adia said in its annual report that its 20-year and 30-year annualized rates of return were 6.1 per cent and 6.9 per

cent in 2016. That compares to 6.5 per cent and 7.5 per cent respectively in 2015 for the same time frames.

Sheikh Hamed said the drop in gains was attributable to the exclusion strong returns in the mid-1980s and 1990s

from the rolling averages, and stressed that Adia’s real rates of return remain consistent with historical levels.

Adia opened a new office in Hong Kong in October to tap growth in Asian emerging markets, amid what Adia

described at the time as slowing global growth and asset valuations that had been inflated by low interest rates.

Adia has said it is upbeat about the economic outlook for China and would be open to more investments there.

The sovereign wealth fund started investing in China in 1992 when the market was first opened to foreign

investors. Its portfolio in the country includes a US$2.5 billion Qualified Foreign Institutional Investor allocation to

the China A market, as well as additional investments in China B shares and shares in China-focused companies

listed on stock exchanges including Hong Kong and New York.


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JOB LOSSES HIT ABU DHABI REALTY HARD Monday, July 3, 2017

Job losses leading to higher vacancy rates continue to have a telling effect on Abu Dhabi’s residential space, and

more so at the top end of the rental spectrum.

Over the last 12 months, apartment rents are down by a fairly significant 10 per cent, including by about 3 per

cent in the second quarter, says the latest market update from JLL.

Given the predominance of high-end homes within Abu Dhabi’s existing residential base, the changes in rentals

are reflected more in this category than in mid- to lower end.

And it could be a while before new mid-market homes come to the market, notably The Bridges from Aldar. Of

the six mid-rise buildings (each with 212 units), the master-developer is retaining three for leasing purposes and

has offered the other three as freehold.

Deliveries are scheduled for early 2020. For the moment though, Abu Dhabi’s residential market is seeing a

“combination of increased living costs, cuts in housing allowances and less certainty in the job market,” the JLL

report states.

This has led “some residents to downsize to smaller and cheaper units [and] vacancy rates will therefore continue

to place downward pressure on residential rents.” And it might mean developers who don’t have the deep

pockets need to pace their projects — current and to be launched — accordingly. Apart from the demand pulled

in for The Bridges, investors have not been rushing to acquire off-plan units in Abu Dhabi.

In fact, demand for premium residential real estate took a 3 per cent decline in the second quarter (and 11 per

cent over the last 12 months), JLL says. During the three months from April, around 900 units were handed over

and which brought the emirate’s total housing stock to about 250,000 units. Among the significant handovers

included the Sigma Towers on Al Reem Island and Bloom Gardens’ Phase 3 on Al Salam Street.

In an ideal situation, 4,000 new homes were to be delivered through this year. But the current realities suggest

the market should see a “significant proportion” of the intended supply getting delayed at the “final stages of

approval and handover”.

That from a developer’s perspective means less chances of a market awash in unsold inventory, while for the

landlord it reduces the risk of having to lease when rents are under extreme duress. From a market perspective, it

helped that the second quarter did not see any major new office properties being ready. But 170,000 square

metres of new stock is scheduled for completion this year, including the headquarters of ADIB on Airport Road

and the Leaf and Omega towers on Reem Island.

“Job losses continue, with Abu Dhabi banks cutting over 900 jobs in the past 12 months according to the Statistics

Centre of Abu Dhabi,” JLL notes. “Abu Dhabi firms are hiring fewer employees, with online recruitment activity

declining 47 per cent in the year to March (compared to the same period last year) according to the Monster

Employment Index.

“Requirements for additional office space are expected to remain limited throughout 2017, due to the reduction

in government spending. However, supply remains under control, and Grade A vacancy remains relatively low,

offsetting the negative impact of reduced demand.”

Source: Gulf News

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NEW DH170 MILLION PORT FOR DELMA

ISLAND Friday, July 7, 2017

Abu Dhabi Ports has inaugurated a new Dh170 million port facility on Delma Island, as part of economic

developments for the Al Dhafra region.

The new port covers a total area of 280,725 square metres on the eastern side of Delma Island, which is located

to the North West of Sir Baniyas Island.

The port contains a 103 m ferry terminal, a marina with 160 wet berths and 104 dry berths, as well as other

facilities including a repair yard and Adnoc marine fuelling facility.

“The Delma Port project is one that promises to be a foundation stone in the development of the Al Dhafra Region

through its focus on meeting the highest quality standards,” said staff major general pilot Faris Khalaf Khalfan Al

Mazrouei, chief of the general Authority for the security of ports, borders and free zones, and board member of

Abu Dhabi Ports at the facility’s inauguration.

Al Dhafra Region was formerly known as the Western region of Abu Dhabi. The region, which encompasses two

thirds of Abu Dhabi emirate and has a population of about 202,000, was renamed in March following the issuance

of a law by UAE President Sheikh Khalifa.


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RAK PROPERTIES DELIVERS BERMUDA

VILLAS PROJECT Wednesday, July 5, 2017

RAK Properties has announced the delivery of Bermuda Villas, its latest residential development in Mina Al Arab.

The villa project, the latest edition to the company’s already diverse property portfolio, was developed to help

meet the growing demand for residential property in the emirate of Ras Al Khaimah.

Combining RAK Properties’ signature quality and style, each of the 157 units at Bermuda Villas boasts supreme

comfort and luxury.

The residential townhouses and villas range in size from two to six bedrooms, with the larger units also coming

with rooms for both a driver and a maid.

Source: Gulf News

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LOWER SHARJAH RENTS A BOON FOR

TENANTS Wednesday, July 5, 2017

The growth in supply of affordable properties in Dubai and flexibility by landlords on rental terms is exerting

pressure on house rents in Sharjah. Tenants, who were earlier priced out of Dubai, can now consider moving back

to the emirate. They are also upgrading to larger units, better quality or popular locations in Sharjah.

Apartment rents in Sharjah slipped by seven per cent in the first half of 2017 after an 8.1 per cent decline in 2016,

according to real estate consultancy Cluttons.

"Apartment rents are expected to continue softening over the next six months, likely mirroring declines in Dubai

of five per cent to seven per cent as landlords move to remain competitive. The decrease in prices has kept

tenants interested and kept the number of enquiries for apartments at a sustained level, despite a number of

companies downsizing their staff requirements," said Suzanne Eveleigh, Cluttons' head of Sharjah.

Rents in Al Nahda have lost the most ground, decreasing by 10.9 per cent between January and June 2017.

However, in Al Nahda, the rate for one-bedroom flats has dropped by almost a fifth to stand at Dh38, 000 per

annum, while three-bedroom apartments (Dh70, 000 per annum) registered growth.

Traditionally, apartments in Al Nahda, Rolla and areas around the Corniche have been popular among tenants.

"The continuous delivery of new supply in Dubai is putting pressure on existing Sharjah rents and forcing new

landlords to offer incentives or discounts to encourage take-up. We are likely to see some relocations after the

end of the school term. However, the Sharjah government is increasingly launching projects and initiatives to

increase employment opportunities and attract long-term residents," said John Stevens, managing director,

Asteco.

Average residential rents in Sharjah fell by 5.5 per cent in the 12 months to 2017, according to Cluttons. However,

villas in Sharjah have bucked this trend and recorded an 11.7 per cent rise in rents during the first six months of

the year.

Cluttons estimates average villa rents in Sharjah at almost Dh112, 000 per annum. They offer a definite cost

advantage when compared to Dubai and Abu Dhabi, where average annual villa rents at the lower end of the

spectrum stand at roughly Dh140,000 to Dh150,000.

"In the villa market, end-users are being lured to Sharjah by the value offered in some of its up-and-coming

residential communities, where annual rents stand significantly lower than Dubai. Sharjah's villa market remains

relatively small and the demand being created by cost-conscious end-users looking for living environments on par

with Dubai are ensuring that demand continues to increase," said Faisal Durrani, head of research at Cluttons.

People, who live in Sharjah and work in Dubai, usually sacrifice a convenient travelling time for bigger sized

rooms.

"People leave their one or two-bedroom apartments in Dubai and move into villas in Sharjah. People who move

generally get to live in a different environment, different lifestyle and may be close to Corniche areas which is

generally perfectly suited for families," said Mansi Saxena, marketing director, SPF Realty.

Despite cheaper rents in Sharjah, there has not been a considerable movement of tenants from Dubai.






"This primarily depends on two factors: one being the preference of tenants who favour a lower commute time to

work or their child's school, and the second factor being the rents in Dubai are also decreasing day by day," added

SPF's Saxena.

Tenants are spoilt for choice in Dubai's competitive housing market today. According to Parvees Gafur, CEO of

TrustWorthy, a Dubai-based real estate brokerage firm: "It is easier for tenants to find an apartment in Dubai

within their budget and close to public transport such as the Metro and bus stations. Landlords offering

incentives such as flexible payment terms or rent-free periods to contracts has encouraged people to consider

Dubai as their foremost option."

Source: Gulf News

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SHARJAH RENT DROPS 'LIKELY' ON TOP OF

5.5% DECLINE IN THE LAST 12 MONTHS,

SAYS PROPERTY CONSULTANCY Monday, July 3, 2017

Further rent drops are likely in Sharjah’s apartment space on top of the 5.5 per cent average decline in the last 12

months, according to a new update from property consultancy Cluttons.

The upcoming drops — by 5-7 per cent — could mirror those in Dubai, “as landlords move to remain competitive”.

For those tenants looking for a new apartment to move into, rents in Al Nahda “lost the most ground”, falling by

10.9 per cent in the first six months. It is a location where a number of new towers were completed in recent

quarters.

A one-bedroom unit there can now be secured for Dh38, 000, dropping by a fifth from what it was at the start of

the year. Interestingly, there was a demand spike for three-bed units in the area, currently leasing for Dh70, 000 a

year.

Even more of a surprise given the soft market conditions, villa rentals in Sharjah seems to be recovering lost

ground... and handsomely at that.

In the first-half, these properties have seen a gain by 11.7 per cent on average (to around the Dh112, 000-a-year

mark).

“This is the first rise in villa rents since late 2015 and reflects the growing awareness of the cost advantages

offered by villas in Sharjah when compared to rentals in Dubai and Abu Dhabi,” Cluttons reports.

This would also play well on freehold sales. “Demand for villas is likely to continue rising, fuelled by the relative

affordability of homes, which will remain a key catalyst behind the multitude of mixed-use freehold projects

bubbling through.”

Source: Gulf News

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ILLEGAL CONSTRUCTION PULLED DOWN IN

SHARJAH Wednesday, July 5, 2017

Al Dhaid Municipality, in coordination with Sharjah Police, demolished illegal warehouses, rooms and animal

barns which were newly built by a farm owner on government land in Al Dhaid area.

Mussabah Al Tunaiji, Director of Al Dhaid Municipality, told Khaleej Times said that the violation also led to

blocking of the internal roads, as well as hindering the delivery of services to one of the farms in the area.

He said that with the help of Al Dhaid Comprehensive Police Station and the Department of Planning and

Surveying, a working team was formed to remove the illegal construction after taking the legal procedures.

He pointed out that the municipality notified the owner of the farm that the construction must be pulled down

and was given grace period which expired without him obeying the order.

The team of legal department, police and municipality carried out the demolition.

He explained that the illegal buildings which were removed include warehouse built of bricks, storage rooms, and

5 sheds in different areas. "The demolition operation continued for two days," he said.

The municipality urged owners of farms and public to avoid such kinds of violations and refrain from carrying out

illegal construction on government property.


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RAK TO HAVE SEVEN NEW POWER

STATIONS WORTH DH750M Tuesday, July 4, 2017

The Federal Electricity and Water Authority, known as Fewa, is to build seven new power stations, worth Dh750

million, in Ras Al Khaimah.

The projects, in line with the national agenda and Emirates 2021 Vision, are meant to meet the needs of housing,

tourist, industrial, commercial and residential sectors, according to Mohammed Saleh, Director General of FEWA.

The new power stations publicly tendered include three main stations, he added. "The three main stations, worth

Dh500 million, are to be built at the areas of Al Gheil, Al Jazirat Al Hamra, and Al Sharisha."

These are added to four power substations to be built at the Jazirat Al Marjan, Filya, Azan, and Khor Khweir areas,

Saleh stated. "These are to stand at Dh250 million."

Saleh said FEWA has also started extending power networks to Buteen Al Samar and Al Rifaa areas even before

the constructions of these residential compounds being carried out by the Sheikh Zayed Housing programme.

Few days back, FEWA started operating the Al Daqdaqa power station, Saleh said. "The new power station, with a

capacity of 3x25MVA, is to secure electricity to the Emirati nationals of Suhaila and Al Daqdaqa areas, let alone the

future projects."

FEWA has further started operating another power station at the Hamraniya area, he said. "The new power

station, with a capacity of 3x25MVA, is to secure electricity to the strategic projects at the Hamraniya and Seeh Al

Bana areas, and to reduce load on the old power station."

FEWA has also finished the expansion works of the Rifaa-2 main power station, he said. "We have added a new

transmitter with a capacity of 90MVA to secure power for 3,000 houses of Emirati nationals at the Buteen Al

Samar compound."

Saleh pointed out that FEWA is in full cooperation with the Sheikh Zayed Housing Programme and local

departments in Ras Al Khaimah to ensure the electricity and water needs.

"We started building eight new power stations of 33/11KV two years ago, along with a main power station of

132/11KV, leave alone several expansions of the old stations," he said. "These projects stand at Dh550 million."

Saleh said FEWA has replaced over 100km of earth power cables across the emirate of Ras Al Khaimah. "These are

meant to boost the performance of the main electricity transmission and distribution networks."


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CANADA SEEKS UAE INVESTMENTS IN

INFRASTRUCTURE PROJECTS Sunday, July 2, 2017

Canada is looking to attract UAE companies to invest in $125 billion (Dh459 billion) infrastructure development

projects the country has launched, its ambassador to the UAE told Gulf News in an interview.

“It is a wonderful opportunity for sovereign wealth funds and private investors to invest in Canadian

infrastructure. We are encouraging UAE investors to take a look at Canada for investment,” said Masud Husain.

“This year we will also have an infrastructure bank, which is going to make it even easier for foreign investors to

invest in Canadian infrastructure projects. The bank will not only be investing but will also help investors to find

specific infrastructure projects for investment,” he added.

UAE companies have been big investors in Canada. Some of the big investors include Abu Dhabi National Energy

Company also known as Taqa which invested in oil and gas sector, Abu Dhabi’s Nova Chemicals which was part of

IPIC now merged with Mubadala has also invested in Canada. DP World is another major investor in Canada.

At 150, Canada’s economy is supported by strong fundamentals

The UAE and Canada may be half a world away from each other, but trade links between the two countries are

growing.

The UAE investments in Canada are in the range of $10 to $20 billion, Ambassador Husain said. “We expect more

investments to flow into Canada as ties between the two countries become stronger. We have about 150

Canadian companies operating in the UAE.”

Canada and UAE could attract more investments once the Foreign Investment Protection Agreement is signed

between the two countries. Currently negotiations are on, the ambassador said.

Canada-UAE business ties stronger than ever

The two countries are working to develop a long-term strategic relationship in the aviation sector with emphasis

on joint manufacturing possibilities with firms like Strata. “Canada is huge in the aerospace field. Montreal has an

enormous aviation hub for companies like CAE, Bell helicopters. The relationship can get bigger and stronger

between the two countries in the coming days.”

Air Canada expects Dubai traffic to climb

For Canada, the UAE offers a hub to distribute its trade goods throughout the Middle East, and further afield into

Asia, a role that makes it Canada’s 16th largest trade partner globally. For the UAE, investments in Canada help

continue its programme of economic diversification.

Bilateral trade grew 361 per cent between 2005 and 2014, from $564 million to $2.6 billion.

Economic bright spot

Ambassador Husain highlighted the growing links in a letter posted to the Canadian Embassy’s website in

November, writing: “The volume of Canadian exports, approximately C$2 billion [about Dh5.6 billion] in 2015, has

grown significantly in recent years and the UAE is one of Canada’s largest trading partners in the Middle East and

North Africa. The UAE is also a top foreign investor in Canada, and more than 150 Canadian companies have a

local or a regional office located in the UAE.”






In an interview with Gulf News in October, Canadian Consul General Emmanuel Kamarianakis explained why. “If

you look at what’s happening in this region, this is an economic bright spot,” he said. “I mean, there’s so much

economic activity and also a very positive, diverse, tolerant, open and transparent climate that it makes it a

natural staging point both to do business here and to do business in the region.”

Canada exports around $400 million worth of agricultural products to the UAE, including $200 million worth of

Canola seed and another $100 million in pulses, much of it re-exported to Pakistan, South East Asia and China.

Aviation and automobile parts form a large proportion of Canada’s industrial capacity, which Kamarianakis said

aligned with UAE needs.

Francois-Philippe Champagne, Canada’s Minister for International Trade, visited Dubai in March, when he said

he’d discussed creating a hangar dedicated to Canadian firms with DP World to improve supply times to

customers in the region. “The way to do that is obviously to stock some of the products here in Dubai,” he said.

Source: Gulf News

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TAXES TAKE THE HEAT OFF CANADIAN

PROPERTY Sunday, July 2, 2017

Canada’s property market may have stepped back a bit from its overheated levels, but that will not give Gulf-

based investors cold comfort. Because the cooling off has come about at their expense and that of other foreign

buyers wanting to acquire realty assets in Canada. This was brought on by direct market intervention in the form

of higher stamp duty, as was the case in Vancouver and one of the popular hotspots for real estate investments

among overseas buyers. It was last August that Vancouver imposed a steep 15 per cent on foreign investment for

property purchases. The stated aim was to level the playing field for prospective domestic buyers, who were

finding the hike in values putting homes beyond their reach.

Since the start of the year, foreign buyer led investments have been tailing off, and helping cool down property

values from super-charged highs. The process is still on, according to Canadian property market observers.

“The authorities in Hong Kong, London and Australia had already made strong interventions in the property

market to cool down property prices,” said an official with a property brokerage firm in Dubai. “The best way to do

so was make it more expensive for foreign buyers, both to buy and hold these assets.

“Vancouver had to follow because there were rising instances of properties lying vacant after being snapped up

by foreign buyers for investment purposes. It had become difficult for the authorities not to as it would have

consequences for them politically.”

There is a common thread running through all of these events. First came the Chinese wave of investments into

Australia and Canada and in the case of Hong Kong. The buy-them-all-up mentality of these buyers meant that a

property only had to be listed for an hour or less before they got snapped up. And these were principally upfront

all-cash transactions. With that kind of buying power, domestic buyers, especially those wanting to get in for the

first time or trade up, never stood a chance.

“But the higher stamp duty in places like Vancouver will make it difficult for those UAE-based expats wanting to

migrate to Canada,” said the estate agent. “Apart from the spike in values, the US dollar-Canadian dollar exchange

rate does not offer much benefit for UAE based expats, unlike the dollar-pound, dollar-rupee situation.” (A US

dollar currently fetches 1.3 Canadian.)

Interestingly, the strength of the Canadian currency in recent times have made its cities a more expensive place to

be for expat professionals. In Mercer’s latest cost of living rankings, Vancouver shot up 35 places from last year to

be placed 107th.

It thus overtook Toronto (at 119) to be the most expensive Canadian city in the ranking, followed by Montreal

(129) and Calgary (143). Ranking 152, Ottawa is the least expensive city in Canada.

“The Canadian dollar has appreciated in value triggering the major jumps in this year’s ranking,” said the Mercer

report.

Source: Gulf News

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COST OF GETTING ON THE UK PROPERTY

LADDER SURGES TO RECORD Saturday, July 1, 2017

First-time buyers in the UK property market are paying a record amount to purchase a home, with Londoners

shelling out almost double the average for the rest of the country.

Nationally, the average house price paid by new entrants rose to £207,693 ($270,000) in the first half, with

purchasers laying down a 16 per cent deposit, according to data from lender Halifax.

In London, getting a foot on the property ladder cost £409,975, up 66 per cent since 2012. Deposits on property

averaged more than three times the national level, at £106,577. That’s up fourfold in the past decade.

The capital also plays host to all 10 of Britain’s least affordable areas, led by Brent where an average first home is

12.5 times average earnings. That compares with the most reasonable area, Sterling in Scotland, where a property

costs 2.9 times earnings.

The report shows the continuing strength of first-time demand after months of data pointing to a housing

slowdown, with Halifax reporting in May the slowest quarterly growth in home values in four years. High levels of

employment, low mortgage rates and government support schemes have all contributed.

Source: Gulf News

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MANHATTAN APARTMENT PRICES HIT

RECORD, AVERAGING $2.19 MILLION Thursday, July 6, 2017

Prices for Manhattan real estate hit a new all-time high in the second quarter, with apartments now selling for an

average of $2.19 million, according to a new report.

Despite soft sales in the second half of 2016 and an uneven start to the year that led many to predict a slowdown

at the high end, sales in Manhattan showed surprising resilience in the second quarter.

The total number of sales jumped 15 percent compared with last year, to 3,153, according to the report from

Douglas Elliman Real Estate and Miller Samuel Real Estate Appraisers and Consultants.

The average sales price rose 8 percent over the same period last year, hitting $2.19 million. The median sales

price also hit a record, up 7 percent to $1.19 million. While homes were sitting on the market slightly longer,

inventory fell modestly.

"The expectation for the second quarter had been more modest," said Jonathan Miller, president of Miller Samuel.

"We did see the market cool in April. But by May the market kicked in and the quarter ended up finishing strong."

Miller said the strong sales and prices were driven by two factors: more realistic sellers and continued pent-up

demand from buyers who held off purchases in 2016.

"Sellers realized that if they wanted to move their property, they needed to be more realistic," he said.

Condos — especially new condos — continue to fuel the rise. The average condo sales price jumped 13 percent

over the same quarter last year, to $3.12 million. Despite concerns about a glut of fresh condo towers in

Manhattan, sales of new units continued to be brisk. The average sales price for new condos jumped 7 percent to

$4.70 million. Inventory rose only slightly, to a 5½-month supply.

As for the rest of the year, Miller said that the very top of the market — multimillion-dollar apartments — will

continue to be weaker than the entry-level market (entry level being a relative term in Manhattan). But, he said,

the outlook for the upper end has improved.

"I think the upper half of the market is stronger than we think," he said.

Source: CNBC – Real Estate

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GULF INVESTMENT TO CONTINUE IN

BOOMING US WAREHOUSE SPACE Saturday, July 8, 2017

The “record-breaking” industrial property market in the United States is likely to continue attracting capital from

the Middle East, according to brokers.

James Breeze, the national director of industrial research for Colliers USA, said the continued expansion of the US

economy, backed by a growing demand for logistics space from e-commerce, has led to a increase of prices and

the lowest levels of vacant space ever recorded. Prices for industrial property rose to US$80 per square foot by

the end of last year - an 8 per cent increase on 2015.

Meanwhile, by the end of the first quarter of this year, vacancy rates for industrial space dropped to the lowest

ever rate recorded - 5.4 per cent - despite 55 million square feet of new space being added. A further 198 million

sq ft is currently under construction.

“We are in our eighth year of economic expansion with strong job growth and consumer spending, a major driver

for industrial demand,” said Mr Breeze. He added that demand from e-commerce firms “has created a

renaissance for industrial real estate because of the need for modern distribution centres” in locations close to

customers.

According to Colliers, e-commerce sales in the US grew 15 per cent year-on-year in the first quarter of 2017 and

now account for 8.5 per cent of all retail sales.

Such strong fundamentals have been attracting investors from the Arabian Gulf countries. In April, the Bahrain-

based Investcorp bought $160 million worth of industrial property in Chicago and Boston, while GFH bought

$65m of industrial property in mid-western states last year to add to a $125m portfolio it bought in December

2015. In the same month, a joint venture between Abu Dhabi Investment Authority (Adia) and the Canadian

pension fund PSP Investments bought a $3 billion portfolio of industrial properties from Exeter Property Group.

Jack Fraker, the managing director of CBRE’s global industrial and logistics business, said the volume of

investment deals in the first half of 2017 was likely to “meet or exceed” last year’s figure.

“The US industrial & logistics sector continues to attract foreign investors,” he said. “In addition to numerous

investors from the Middle East, this includes the South Koreans, Singapore-based Reits [real estate investment

trusts] and investors, Chinese, Australian, European and even South American sovereign wealth funds.”

He said investors are not especially focused on particular cities, “although they do want to be in the top 50 US

markets, including cities in the central part of the country”.

Peter Kroner, a senior research analyst for US industrial capital markets at JLL, said Gulf investors typically favour

“the ability to deploy a significant amount of investment in one or two transactions”, buying portfolios rather than

building their own.

He said these bigger deals offer investors who are new to the industry “the opportunity to build a nationally-

focused portfolio of assets” in major cities.

The top four markets in the country in terms of rental performance are northern New Jersey, San Francisco mid-

peninsula, Seattle and Inland Empire (southern California).






“All four markets boasted annualised growth rates of over 10 per cent,” said Mr Kroner.

He put this down to the strength of tenant demand, as well as a "conservative" approach to building new space.

This has led to chronic shortages and bidding wars in some markets.

Mr Breeze said that alongside the e-commerce sector, he expects more demand for manufacturing space as a

result of the Trump administration’s policies, with more firms "reshoring" manufacturing jobs from other markets.

“Reshoring is picking up in the United States,” he said. “While I cannot discuss specific deals, we are seeing the

most increase in demand for real estate because of reshoring in pro-business states with a trained workforce,

particularly in the south east and mid-west parts of the country.”


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With over 30 years of Middle East experience,

Asteco’s Valuation & Advisory Services

Team brings together a group of the Gulf’s

leading real estate experts.

Asteco’s network of offices in Abu Dhabi, Al Ain, Dubai,

Northern Emirates, Qatar, Jordan and the Kingdom of

Saudi Arabia not only provides a deep understanding of

the local markets but also enables us to undertake large

instructions where we can quickly apply resources to meet

clients requirements.

Our breadth of experience across all the main property

sectors is underpinned by our sales, leasing and

investment teams transacting in the market and a wealth

of research that supports our decision making.

John Allen BSc MRICS

Director, Valuation & Advisory

+971 4 403 7777

[email protected]

Jenny Weidling BA (Hons)

Manager – Research and Advisory

+971 4 403 7789

[email protected]

VALUATION & ADVISORY

Our professional advisory services are conducted by

suitably qualified personnel all of whom have had

extensive real estate experience within the Middle

East and internationally.

Our valuations are carried out in accordance with the

Royal Institution of Chartered Surveyors (RICS) and

International Valuation Standards (IVS) and are

undertaken by appropriately qualified valuers with

extensive local experience.

The Professional Services Asteco conducts throughout

the region include:

• Consultancy and Advisory Services

• Market Research

• Valuation Services

SALES

Asteco has established a large regional property sales

division with representatives based in UAE, Saudi

Arabia, Qatar and Jordan.

Our sales teams have extensive experience in the

negotiation and sale of a variety of assets.

LEASING

Asteco has been instrumental in the leasing of many

high-profile developments across the GCC.

ASSET MANAGEMENT

Asteco provides comprehensive asset management

services to all property owners, whether a single unit

(IPM) or a regional mixed use portfolio. Our focus is

on maximising value for our Clients.

OWNER ASSOCIATION

Asteco has the experience, systems, procedures and

manuals in place to provide streamlined

comprehensive Association Management and

Consultancy Services to residential, commercial and

mixed use communities throughout the GCC Region.

SALES MANAGEMENT

Our Sales Management services are comprehensive

and encompass everything required for the successful

completion and handover of units to individual unit

owners.

NEWS BRIEF 28 - Asteco

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