NEWS BRIEF 48 - Asteco Property Management5 locations that offer cheapest rents in dubai damac...

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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 48 SUNDAY, 26 NOVEMBER 2017

Transcript of NEWS BRIEF 48 - Asteco Property Management5 locations that offer cheapest rents in dubai damac...

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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 48 SUNDAY, 26 NOVEMBER 2017

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REAL ESTATE NEWS

UAE / GCC

MAKING CITIES AN EXTENSION OF A WORKPLACE

VAT CAN PROMPT UAE RESIDENTIAL DEVELOPERS TO GET MORE GENEROUS

PREVENTING FIRES AT HOME: BE AWARE AND PREPARE

FLY TO YOUR HOME?

VAT ON COMMERCIAL LEASES

ARABTEC SUBSIDIARY TARGET WINS DH950M CONTRACT FOR EMAAR PROJECT

EMIRATES NBD REAL ESTATE INVESTMENT TRUST SAYS PROPERTY OCCUPANCY ROSE IN THE THIRD QUARTER

ECONOMICS 101: IS SAUDI ARABIA RIGHT TO PURSUE AUSTERITY?

WATCH OUT FOR INDIRECT VAT COSTS ON PROPERTY DEALS

WHY PROPERTY INVESTORS MUST LOOK BEYOND THE TALK OF DOOM AND GLOOM

WHY INVEST IN REITS VS DIRECT PROPERTY OWNERSHIP

GUARANTEED RETURNS ON OFF-PLAN ARE TOO GOOD TO BE TRUE

VAT IN UAE: KEY FACTS ON REAL ESTATE

BAHRAIN HOTEL ROOM RATES IN OCTOBER SLUMP TO 11-YEAR LOW

DUBAI

AZIZI STARTS WORK ON 105-BUILDING COMMUNITY

LAND IN DUBAI HOLDS VALUE FOR INVESTORS

FROM ISLAND LIVING TO A ‘NORMAL’ LIFE

BANYAN TREE MAKES A MOVE INTO RESIDENTIAL SPACE

EMAAR DEVELOPMENT’S BOARD APPOINTS NEW VICE-CHAIRMAN

GLOBAL VILLAGE TO HOST FIVE DAYS OF NATIONAL DAY EVENTS

DUBAI INVESTMENTS LEAD CONSORTIUM TO BUY DUBAI COLLEGE CAMPUS

DHL EXPANDS DUBAI LOGISTICS HUB ON REGIONAL GROWTH FORECASTS

'MY TENANT IGNORED THE EVICTION NOTICE AND FILED THE RENTAL CHEQUE AT RERA. HOW DO I GET HIM TO LEAVE?'

DUBIZZLE RECORDS RISING DEMAND FOR HOUSING PRICED BELOW DH1,000/SQ FT

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REAL ESTATE NEWS

FEARS OF OVERSUPPLY IN DUBAI ARE EXAGGERATED

BANYAN TREE LAUNCHES FIRST ME'S RESIDENTIAL PROJECT IN DUBAI

5 LOCATIONS THAT OFFER CHEAPEST RENTS IN DUBAI

DAMAC LAUNCHES SPECIAL SALES EVENT FOR VILLAS

MILLENNIUM TO OPEN MIXED USE HOTEL IN DUBAI'S MIRDIF HILLS IN 2018

ABU DHABI

ABU DHABI HOTEL RATES ZOOM DURING F1 WEEK

NORTHERN EMIRATES

SHARJAH BEACH TO BECOME MAJOR TOURIST ATTRACTION

CRESCENT ENTERPRISES ANNOUNCES NEW $150M VENTURE CAPITAL DIVISION

INTERNATIONAL VISITORS DRIVE RAS AL KHAIMAH'S TOURISM AMBITION

INTERNATIONAL

EXPAT INDIANS ONLY TOO WILLING TO SNAP UP PROPERTY BACK HOME

FOREIGN BUYERS FACE UK CAPITAL-GAINS TAX ON PROPERTY PURCHASES

ORASCOM CONSTRUCTION SAYS THIRD QUARTER NET INCOME SLIPS 13.8 PER CENT, DRAGGED DOWN BY US BUSINESS

REFORMS INSPIRE MORE UAE NRIS TO BUY HOMES IN INDIA

NEW JERSEY OFFICE MARKET RENTS APPROACHING RECORD HIGHS

U.S. HOME SALES UPTICK 2.0 PERCENT IN OCTOBER

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MAKING CITIES AN EXTENSION OF A

WORKPLACE Saturday, November 25, 2017

This year‘s Knight Frank ―Global Cities Report‖ looked at what constitutes best-in-class across all aspects of property:

encompassing building design, occupier trends, place making, investment strategy, and mix of uses. However, success in real estate is often achieved by being on the ground where economic growth is strong.

This raises the question — what does a best-in-class city economy look like?

The answer is increasingly about having the culture, diversity, lifestyle, and opportunities necessary to draw talented

people. While employers can provide a micro-location — the workplace — where these factors are brought together,

they must similarly exist at a city-level to generate the critical mass of skilled and creative people necessary to feed growth for successful firms.

This creates a self-fulfilling prophesy in which the most talented people want to live there. In turn, the best employers locate there to tap that high value workforce.

The cities that genuinely achieve this are those in the lead ranking of global cities. Locations are losing businesses, jobs

or investment to places that are.

In today‘s world the cities that are successfully earning the right to be called a global city are those at the forefront of

the tech and creative revolution, which is demonstrated by economic growth. Since 2007, the GDP of Berlin, with its thriving technology scene, has expanded by 19 per cent, whereas in finance-oriented Frankfurt output grew by just 5.9

per cent, according to Oxford Economics.

Similarly, in the US we see tech- and R&D-oriented cities like San Francisco (17.6 per cent GDP growth since 2007) and Boston (15.2 per cent) outperforming locations like Chicago (6.2 per cent) and Miami (6.6 per cent). However, note the

level of growth seen since 2007 in cities such as London (21.2 per cent) and New York City (11.5 per cent).

Both were finance-led cities back in 2007, and which successfully re-weighted towards technology and the creative

industries in the last decade. This arguably makes adaptability a greater strength than a large tech exposure. If the technology sector moves into a downturn, we will find out whether Berlin can quickly reposition itself towards the next

rising industry.

To a property investor London and New York City offer the security of having proved themselves capable of reinvention. The picture that we see emerging is that the ability of a city to draw in fast rising tech and creative firms is

defined by whether the location has the ability to become a city that offers inspiration and contains as much wow-factor as a Google office. If it hopes to draw firms of that calibre ...

A city must provide the ambitious with a stage they want to succeed on, because impressing bohemian friends in the

cool part of town is more important than pleasing any boss.

So logically the next and final question is simple, is Dubai a global super city?

It certainly does not lack the wow-factor, but Dubai is much more than the eye-catching commercial and residential real estate it is renowned for. In recent years, Dubai has excelled in attracting young international talent, but mainly to

the worlds of finance and business.

Now Dubai is seeking to diversify by offering the kind of culture, work hubs and social spaces that see a new

generation of creative pioneers who consider working and living in Dubai in the way they might in London, Berlin or

New York. These amenities come in many package, from its offering of world-class lifestyle in locations such as DIFC, to the cultural offerings at Dubai Opera and Dubai Design District, The Dubai World Cup and Art Dubai.

All of this is underpinned by a population that contains over 200 nationalities.

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These factors combined with Dubai‘s strategic location and business credentials continue to produce results. The

population has grown by over 85 per cent over the last decade and GDP by 29.5 per cent over the same time period. Dubai is certainly seen as a global city by both businesses and by employees.

To maintain its global city status, Dubai must continue to be an open, diverse and vibrant place to live and work to ensure it continues to excel as of one the world‘s super cities. At a time where many developed economies are facing

populist pressure to step back from globalisation, Dubai‘s openness to it will mean it will continue to be a regional hub

for global business.

Source: Gulf News

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VAT CAN PROMPT UAE RESIDENTIAL

DEVELOPERS TO GET MORE GENEROUS Wednesday, November 22, 2017

Come 2018, property buyers can expect UAE developers to turn even more generous with their sales incentives,

especially on the post-handover payment plans.

This is so because the upcoming VAT regulations on residential sales offers developers a zero rate on all residential

sales within three years of the completion of a project. Any home sale done after those three years will come under the 5 per cent VAT scanner.

Because of that, developers have a definite timeline before them to complete their sales and not have to pay VAT. This

being the case, UAE‘s property market, especially the one in Dubai, can expect developers to launch off-plan sales even before they start construction on site.

Or they could ―bring in more attractive payment plans,‖ said Faisal Durrani, Head of Research at Cluttons. ―In extreme cases, a developer or two is offering payment schemes 10 years after handover. But we could see more of that

happening as developers ensure they sell all of their stock at a particular building.‖

Interestingly, developers have also been given a VAT-specific reason to finish construction. ―They will be able to claim a rebate on the VAT of building materials provided they are able to sell within three years of completion,‖ said Durrani.

―There is an incentive for developers that the schemes they bring to the market can be absorbed. But how people claim rebates need to be worked out.

―Clearly, if they are unable to sell within three years, that project is not a success. Developers in Dubai have been so

used to the ―build and they will come‖ mentality. VAT will go some way in making sure the stock developers bring in can be absorbed. That‘s a bit of a sea change for developers in Dubai.‖ According to Sailesh Irani, Director at Sun &

Sand Developers, ―All VAT payments made by a developer to a building material supplier can be offset. That eventually comes through as a credit in the developer account.‖

The surge in off-plan sales was there for the better part of this year, and it‘s only over the last four weeks that there has been some drop in such activity. Market sources say that the period before, during and after Cityscape Global in

Dubai recorded higher than average off-plan launches, and that developers might be taking a bit of a breather now.

―It could be that developers will need to think about building more affordable projects, to be reasonably sure of completing sales within the stipulated time,‖ said Durrani. ―When we are talking about prime properties, those between

Dh1,500-Dh2,000 a square foot, is the segment that is seeing the sharpest correction now.

―Thankfully, the days of speculative developers have gone. These one-off developers were weeded out because of

regulatory changes, the doubling of registration fees, implementation of escrow, etc..‖

But, according to Cluttons, the super-prime end of the Dubai market is more or less unaffected. The wealthy are still making those multi-million dollar purchases.

But a potential headache looms — ―The Chinese are currently the fourth largest buyer demographic in Dubai property outside of GCC nationals. But there are restrictions on how much they can take out of China and spend overseas —

right now, it‘s set at $100,000 (Dh367.300) per person each year.

―There could be stricter policing by Chinese authorities over whether these levels are being breached. The property

markets in Canada, the UK and Dubai could be affected if this policing gets serious.‖

Dubai developers need to give serious thought to affordable options

The VAT guidelines are clear — no VAT on residential units at buildings within three years of their completion. But for

developers to be extra sure, they need to rethink their offer mix.

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Sticking with upscale projects — at Dh1,500-Dh2,000 a square foot — as their preference comes with a risk. There is

already a sizeable supply of such properties in the marketplace. More of the same could have difficulty landing buyers.

―The affordable issue is yet to be addressed in full — the Dubai Land Department has been thinking about a quota

system,‖ said Faisal Durrani of Cluttons. ―In this, a certain proportion of the project is made affordable — but it‘s not clear whether it‘s affordable for tenants or buyers.

―They aim to have these in central locations and not the outskirts. It could mean a separate building or the affordable

part is done on a lower floor. But it remains to be seen how it‘s played out in a market like Dubai. Abu Dhabi has done it, with the Municipality allowing landlords to convert buildings, provided they meet certain criteria like size, location,

proximity to bus stops. These are targeted at people earning less than Dh6,000 a month.

―The rents they can charge must only be a third of the tenant‘s income. And the landlords are being guaranteed an

yield of 30 per cent. A yield of 30 per cent — that‘s probably too hard to resist.‖

Source: Gulf News

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PREVENTING FIRES AT HOME: BE AWARE

AND PREPARE Wednesday, November 22, 2017

From bodily harm to property damage, the effects of fires can be devastating. The ―it won‘t happen to me‖ attitude is

what catches most people off guard and by then it is too late to prevent or manage a fire. By exercising good safety habits and adopting simple preventive practices, one can greatly cut down on fire risks. ―Always remember that

prevention is better than cure,‖ says Christian G. Beltran, first aid and fire safety instructor at Al Salama, a fire safety training company. ―Residents should have some knowledge or training in basic fire safety.‖

Vijay Chandran, marketing manager of Dafoos Group of Companies, says that in the unfortunate event of a fire, saving

lives and minimising damage to properties is what residents should strive for. But he reiterates that people need to be aware and proactive. ―Most of the residential units these days are equipped with automatic fire alarm and firefighting

systems which are to be maintained in a healthy condition. Ignoring a fire alarm is suicidal.‖

Proper care of electrical equipment and wires

Faulty electrical equipment and wiring are big hazards. ―When using electrical equipment ensure that appliances do not

have loose or any damaged cord or plugs. And when using extension cords, make sure that you are not running the electrical wires under rugs or heavy furniture. Also, please use standard and quality material,‖ advises Beltran.

Attaching multiple appliances to power sockets is a common habit, and seldom do people bother to understand the power load of a socket. ―Before operating any electrical appliance, ensure that your electric wiring system can safely

cater to its energy requirements,‖ says Chandran. ―Faulty wiring and overloading the electric installations can be

extremely dangerous. Any electrical work has to be carried out by a qualified and authorised person.‖

Cook with care

Kitchens are very prone to fire accidents. From wearing fire resistant clothing to managing cooking temperatures, especially for liquids like oil, simple preventive tips can protect homes from fire. ―Wearing a kitchen apron while cooking

is ideal and it is important to wear cotton clothes that remain fit to the body,‖ advises Chandran. ―Also, heating oil has to be done with utmost care. Cooking oil should be heated with minimum flame to prevent smoking and the flame

should never be allowed to rise above the utensil.‖

He also warns against a common mistake most people make in the event of any fire: dousing it with water, which can be especially dangerous in oil-related fires. ―Adding water to boiling oil can lead to sudden evaporation of the oil,

making vapor concentration sufficient to catch fire; hence it has to be done with extreme caution,‖ says Chandran. ―In the event that cooking oil in a utensil on flame catches fire, water should never be poured into it, as it can lead to a

flare up. Cut off oxygen supply to the burning oil by closing it fully and abruptly. A fire blanket is the best means in

doing so.‖

Cooking gas cylinders should be closed and electric appliances switched off when not in use. Surprisingly, exhaust fans

left to run for long hours are also a frequent source of fire incidents.

Fire safety tools

Smoke detectors and fire alarm systems should be checked yearly. In residential units where fire alarm and firefighting systems are not installed, stand-alone, battery-operated fire alarm devices that are available in the market can be used,

says Chandran. The fire safety equipment in the house should include fire extinguishers, fire blankets and a first-aid kit.

What to do in case of a fire

According to Beltran, the first thing to do is to sound the fire alarm and then inform other people. ―Next inform the Civil

Defence by calling 997,‖ says Beltran. ―If it is a small fire and you are trained, attempt to extinguish the fire and try to assist others. If you are not trained in the use of fire extinguishers, close all doors and windows and leave the area.‖

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The head or at least a member of the family should also know how to operate fire-safety equipment. It is also handy to

have different kinds of fire extinguishers, which can make all the difference when extinguishing a fire.

Residents should also be are aware of the evacuation plan or fire exits, especially children and elderly. According to

Chandran, ―Though pyrophobia, the fear of fire- is inherent, it is important to never panic. Make the best use of each minute patiently with alertness and caution. Evacuate at the earliest while assisting others in doing so.‖

Fires can be devastating, but most are accidental and preventable. So be aware and be safe.

Source: Gulf News

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FLY TO YOUR HOME? Wednesday, November 22, 2017

From erecting 3D-printed buildings to introducing artificial intelligence, smart technology and blockchain in different

industries, the UAE is transforming itself by embracing various technological advances. Its latest mission involves

futuristic transportation concepts, which will unlock unheard-of possibilities in the construction and design spaces. In September, Dubai tested its first automated aerial taxi, built by Volocopter, a German specialty manufacturer of

autonomous air vehicles. The self-flying, two-seat drone has a top speed of 100km per hour, with a maximum flight time of 30 minutes. Dubai‘s road and energy authorities are also offering incentives to encourage the motorist to buy

zero-carbon emission electric vehicles (EVs), as the emirate wants to bring in 42,000 EVs on its streets by 2030. Residents will enjoy benefits such as free public charging, free parking, free EV registration, free Salik tags and a

licence plate sticker identifying the vehicle as an electric car.

Walid El Hindi, CEO of Imkan, an Abu Dhabi-based developer, says that the new modes of transport will have a significant impact on the way urban environments are designed. While much of the public space today is dedicated to

cars, driverless cars and ride-sharing technology promise to reduce the need for parking spaces, he adds.

―Currently most cars are only used 5 per cent of the time, and due to the UAE‘s demographics, most trips have

relatively few passengers,‖ says El Hindi. ―New technology promises to increase the efficiency of vehicle utilisation. With

this greater efficiency comes the possibility of designing public spaces that are healthier, with more pedestrianised zones, more parks and trees, and greater space for the community.‖

Innovative car parks

An Imkan project that is a step in this direction, Makers District, a mixed-use development on Reem Island, is currently

at the ideation stage. It will include facilities for electric vehicles and will accommodate new transportation technologies

such as flying autonomous cars.

―It integrates commercial and residential components in a pedestrianised zone that encourages community formation,‖

says El Hindi. ―Through its public and common spaces, it will give a platform for local creatives and artists to introduce their work to the wider Abu Dhabi community. The Artery, a novel hybrid structure located in the heart of Makers

District, is designed to have multiple uses in addition to serving an overflow parking function.‖

El Hindi explains that car parks are traditionally viewed as negative spaces that are necessary to the developments they

support.

―They are usually unoccupied outside of peak hours, with dead zones in the office parking areas after working hours, and dead zones in residential areas during working hours,‖ says El Hindi. ―Considering how much space they occupy,

their usage has traditionally been quite inefficient, and hence they are often sidelined — physically and conceptually — as development components.‖

With Makers District, Imkan is converting the parking space into a central pulse of the development. ―By designing an

innovative double helix ramp, we have built in flexibility for multiple simultaneous uses of the parking space, allowing large elements of it to be used for commercial and creative purposes, insulated from the noise and pollution cars

typically generate,‖ says El Hindi. ―The Artery can serve as an events and theatre space, and the platforms on the ancillary helix can be used for everything from art mural spaces to basketball courts.‖

Sustainability quotient

High energy prices, climate change and government regulation are already pushing sustainability high on the real

estate agenda, says Vijay Doshi, founder and managing director of Vincitore Real Estate Developments. He anticipates

that over the next few years, the impact on real estate will be far more significant, with technology and sustainability becoming the two key drivers of value.

―The advancement of technologies will accelerate the greening of buildings,‖ says Doshi. ―As the cost of improving buildings‘ environmental performance falls in line with the lower costs of technological innovations, such as solar panels

and efficient heating systems, we see a lot of value engineering taking place regarding architecture and design.‖

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While drone technology is making air travel within the city a possibility in the near future, Doshi believes land-based

transport will remain the norm.

―The drone laws are a recent happening, and in Dubai the licensing for the drone will face more restrictions as the

technology becomes more common around the world,‖ says Doshi. ―So, it is not essential to have drone landing zones. However, electric vehicles will soon become a necessity, given the influx of visitors and business owners expected to be

seen in time for the World Expo 2020 and beyond. Parking zones for electric vehicles are becoming a necessity in Dubai

as users of such transport are increasing, and developers will add these types of amenities accordingly based on the demand.‖

Intelligent spaces

The city of the future will become more connected and permeable than ever, points out Michael Fowler, managing

director of Aedas Middle East. ―Growing up sharing their lives in real time through social media, the next generation will live in cities that place more emphasis on community spaces than individual castles,‖ says Fowler. ―In a world enriched

by virtual and augmented reality, buildings will become background, not content. In turn, residential units will be

smaller, but far more intelligent. Up to now, a smartphone has more technology than a typical dwelling unit, but this will change as the Internet of Things, robotics, and artificial intelligence transform our homes into true machines for

living.‖

Although drone transport will inevitably be implemented, it remains to be seen whether a drone landing pad will

become a vital feature in every development the same way automobile parking has now become a necessity.

―Drones may be a solution to traffic congestion only when they are few,‖ says Fowler. ―If any significant share of current vehicular circulation were taken up by drones, congestion in the air would become an issue, despite the

expected benefit of automated central control. Simply moving individual transport into the sky is not really an ideal solution.‖

Also, as the electric vehicles proliferate, they will help reduce pollution and increase energy efficiency, but this will not change the fundamental challenges of urban traffic. ―The self-driving potential of both drones and automobiles will yield

greater efficiencies in transport,‖ says Fowler. ―By allowing a degree of coordination and cooperation not typical for

human drivers, automated vehicles will be safer and more efficient. However, the paradigm of the private car and driver has to change.‖

While there is a lot of talk about the construction industry‘s readiness to change, Fowlers says the capital-intensive building industry remains traditionally slow to change. ―The building codes and planning regulations need more

flexibility to welcome new technologies,‖ he says. ―Contractual arrangements need to become more collaborative rather

than adversarial. The whole delivery process for built space must become industrial, with buildings viewed more like a high-quality premium product than a bespoke masterpiece of the developer, designer or builder.‖

Functional changes

As developers adapt and transform their developments to satisfy the needs of the people that live in them, the

government is also taking a proactive role in keeping stakeholders on board with its policies. ―We have seen in the UAE

changes in the fire code following fire-related incidents, which have exposed deficiencies in some materials and building techniques,‖ says Nathan Hones, partner at Carter Associates. ―In no other country in the world do the authorities and

municipal departments respond so quickly to address improvements in code and regulation, especially as it relates to occupant safety.‖

While developers may find it a challenge to satisfy the new requirements, Hones believes they are embracing the changes and in turn use these to create unique selling points (USPs) in their developments.

―With stiff competition among developers of residential communities and commercial developments, any evidence that

a developer can illustrate that they are responding to the changing times and are incorporating futuristic needs and the infrastructure to support that, can only help support sales and shift inventory,‖ says Hones.

In the future, Hones expects even more consolidation of tall buildings around transportation nodes in major cities.

―The popularity of drones is increasing at rapid rates. Pick-up and drop-off points, accessibility and security

infrastructure, will all need to adapt to be able to receive drone deliveries,‖ he says. ―We already see preferential car

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parking locations for low-fuel usage vehicles, small cars and electric cars. In the future, driverless cars will also receive

prime car parking spaces in easy-to-access locations.

―Currently, electric cars require a dedicated charging station in car parks, and you will find these cars grouped together.

However, just like you can charge your mobile phone now by placing it on a charging pad instead of plugging it in, eventually we envisage car parking areas will simply charge your car while you park.‖

Ready for the future

Developers that are not taking into consideration emerging transportation concepts in their projects may not be able to attract buyers in the future, says Muhammad Obaid, founder of Emkaan, an architectural and engineering consultancy.

Although the government has not announced specific guidelines for transportation facilities in real estate projects, Obaid says developers must already take into consideration the infrastructure needs that will feed these future

demands. For instance, allotting space within the building or nearby for autonomous vehicles and preparing the infrastructure to accommodate electric cars park power supply.

―I expect those early adopters of technology to survive the coming 10-20 years, while others will be struggling in the

future,‖ says Obaid.

Talking about his current projects, Obaid says some of his clients have made it a requirement to include facilities that

will support the smooth operation of futurist transportation in their developments. ―A client developing a resort in RAK wants to include all necessary facilities that support the use of flying taxi and in another client‘s project in the desert

near Dubai‘s southern border, they require flying taxis to be the main transportation facility.‖

Obaid sees the face of Dubai changing slightly in the coming 10 years, and he expects to see electric cars power supply being available in most of the buildings. ―The flying taxi will be in use but not that much, and it will be limited to some

authorities only,‖ he says. ―However, in future, the autonomous self-flying drones will be available for all and like the cars, people will be parking their flying drones in their buildings, especially in Dubai, the city that never stops surprising

us.‖

He believes that using drones for transport will help make streets walk friendly, with more narrow roads. This will in

turn encourage an active lifestyle, he says.

―People are comfortable to walk in narrow shaded streets than areas that have highways. The current width of roads designed for cars, approximately 15m, will return to its original smaller width, prioritising the needs of humans,

focusing on microclimates and child safety. Narrowing the streets not only enables more shaded areas, but it also reduces the effect of heat islands.‖

Concerning building parking design, he believes designers will now have two main options. ―One on the roof for

autonomous drone passengers and one on the ground for pedestrians,‖ says Obaid. ―Parking spaces currently on the ground, in basements and multistorey buildings would be replaced by parking lots on roofs, dedicated to drones. Most

likely, ground parking spaces would be replaced by landscaping.‖

Source: Gulf News

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VAT ON COMMERCIAL LEASES Wednesday, November 22, 2017

The impending implementation of the value-added tax (VAT) will undoubtedly have many landlords and tenants

scrambling to check their commercial leases for potential liability to VAT. The obvious question is, will the lease be a

gross lease or net lease? Perhaps not so obvious when signing the terms for a new lease, or when midway through a current lease, is that landlords, tenants, assignees, subtenants and sharing occupants could all trigger a potential

liability to VAT by undertaking certain acts or taking occupation. We will discuss these potential trigger.

Commercial leases

We mentioned above about a lease being a gross lease or a net lease. Simply put, a gross lease is where the rent is deemed to be inclusive of VAT, together with other expenses. As such, a tenant would pay the rent to the landlord on

the basis that should any VAT be payable, the landlord would pay such sum from the rents received from the tenant. A

net lease, on the other hand, would require the tenant to pay a separate VAT amount. Depending on how the net lease is worded, the landlord will need to invoice the tenant for the VAT element.

Impact on inducements

A common practice when entering into a new lease or agreeing a lease extension is for the parties to agree

inducements. Tenant inducements can come in a number of ways and may include rent-free periods, rent rebates,

reverse premiums payable and landlords undertaking works. Thought should be given to inducements, and every inducement should be considered carefully. Where a tenant gives consideration for the inducement, such as

undertaking the landlord‘s works itself, this will trigger a requirement for the tenant to charge the landlord VAT for undertaking such works. Interestingly, if the tenant undertakes works on the premises, such as a fit-out or changes the

premises from a shell-and-core state, these are not considered improvements and VAT duty will not arise.

VAT and dealings

Irrespective of the length of a lease, a tenant may seek as much flexibility as possible throughout the term to

counteract future market conditions. This could happen in a number of ways, including the ability to assign, sublet, share occupation or terminate the lease. The VAT burden will generally fall on tenants in these instances and there are

numerous pitfalls to avoid. In instances of subletting, for example, a tenant will eventually become a landlord to the sub-tenant and should therefore ensure it invoices the sub-tenant for both rent and VAT. Where a tenant wishes to

share premises with a group company, the tenant will remain the tenant and so will have to account for VAT for its

group company. Arguably, group companies will also be ―on the hook‖ to share the VAT liability, but the responsibility will ultimately fall on the tenant. On assignments, where a premium to assign is payable, or at lease expiry where a

dilapidations payment is made to the landlord, this will trigger a VAT payment.

VAT impact on break options

The inclusion of a break option is something that a well-advised landlord or tenant should always consider when

negotiating the terms for a lease. The parties may decide to include a mutual break option, or perhaps a landlord or tenant-only break option. Much depends on the bargaining strength of the parties at the time of discussing the heads

of terms. An experienced lawyer would help to negotiate the inclusion of a break option to the advantage of the client, even if this was overlooked or disregarded in the heads of terms stage. Of note, however, is that break options may

attract a break fee payable by the party exercising the break. In such cases, if a break fee is payable, the recipient of the break fee will have to invoice the other party for the VAT element on the break fee.

Lease health checks. Whether a lease is already entered into or to be entered into, or if the property is in a GCC

country outside of the UAE but owned by a UAE company or individual, we advise that a lease health check is undertaken. This will ensure that the terms are clear on VAT, and that a party is not unnecessarily exposed to a

potential VAT payment.

Source: Gulf News

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ARABTEC SUBSIDIARY TARGET WINS

DH950M CONTRACT FOR EMAAR PROJECT Tuesday, November 21, 2017

Arabtec Holding, the UAE‘s top-listed contractor said its wholly-owned subsidiary Target Engineering Construction

Company has won a Dh950 million contract to build the second phase of Emaar‘s Forte residential project in Downtown Dubai.

Target has already been appointed to build the first phase of the project by Emaar – the UAE‘s biggest publically-traded real estate developer – through a Dh196m contract awarded in September.

The scope of the second contract includes the construction of the podium and twin towers with 67 and 46 floors,

Arabtec said in a statement to Dubai Financial Market, where its shares are traded.

The first phase involves the construction of five basements for the two residential towers. Both phases are expected to

take 40 months to complete, the statement added.

―The award of Forte Phase 1 & 2 to Target Engineering demonstrates the strength and confidence of the groups‘

relationship with Emaar Properties,‖ Hamish Tyrwhitt, group chief executive of Arabtec Holding said. ―We look forward

to further building the solid relationships we have with our clients in delivering quality projects.

Arabtec earlier this month posted its third consecutive quarterly profit for the three months ended September 30, as

the construction firm continues to recover from a string of losses on the back of a slowdown in construction sector across the region.

Net profit attributable to equity holders rose to Dh18m in the third quarter of 2017 compared to a loss of Dh226m in

the same period last year. The company is assessing further divestments and options to increase efficiency and productivity through the integration of its operating units, it said at the time.

During the third quarter, Arabtec sold its 14.6 per cent stake in Jordan Wood Industries, a listed Jordanian company that manufactures office and household furniture.

Source: The National

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EMIRATES NBD REAL ESTATE INVESTMENT

TRUST SAYS PROPERTY OCCUPANCY ROSE

IN THE THIRD QUARTER Monday, November 20, 2017

ENBD REIT, the Dh1.6 billion Sharia'a-compliant real estate investment trust managed by Emirates NBD Asset Management Limited, said that occupancy in the properties that they manage saw growth in the third quarter of this

year compared to the same period last year due to an increase in demand for affordable office and residential units.

―ENBD REIT‘s portfolio occupancy growth thus far this quarter has been driven, in part, by strong demand for well-managed office space and affordable residential property in convenient locations," said Anthony Taylor, a real-estate

fund manager at Emirates NBD Asset Management.

"Our proactive asset management philosophy has directly benefited tenants, which has supported improved occupancy.

Tenants can clearly see the benefit of leasing premises owned and managed by ENBD REIT, because they are situated

in high quality buildings, where a high level of service is delivered by the facilities management provider. Competitive lease terms and added incentives have also been important for boosting occupancy across the portfolio.‖

The real estate investment trust highlighted Binghatti Terraces, an affordable residential building in Dubai Silicon Oasis, which reached 88 per cent occupancy this quarter compared to 70 per cent at the end of the September 2017. The

funds two Dubai Healthcare City (DHCC) properties also saw an increase in occupancy to 92 per cent in the third

quarter from 85 per cent for DHCC 25 and from 83 per cent for DHCC 49 in the third quarter of last year, the fund said.

Source: The National

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ECONOMICS 101: IS SAUDI ARABIA RIGHT

TO PURSUE AUSTERITY? Saturday, November 25, 2017

Saudi Arabia‘s third-quarter economic results were mixed.

On the positive side, the fiscal balance improved: the 2017 deficit is expected to shrink to 8.6 per cent of GDP, compared to two consecutive years of over 15 per cent; while on the negative side, the IMF projected an anaemic

growth rate of 0.1 per cent for the economy. These results have ignited a debate that is common to residents of western economies: is the government right to pursue austerity policies, or should it look to loosen the purse strings to

stimulate the economy? The unconventional structure of Saudi Arabia‘s economy means that answering this question

requires a novel suite of analytical tools.

Before exploring the unique underpinnings of the Saudi economy, it is worth noting that the headline figures for Saudi‘s

fiscal balance conceal some encouraging details. In particular, revenues increased 11 per cent year-on-year, and non-oil revenues increased by 80 per cent compared to the third quarter of 2016, driven by new taxes and fees. With the

public debt at a mere 13.1 per cent of GDP at the end of last year, and foreign exchange reserves covering around two

and a half years of imports, Saudi‘s buffers remain strong.

The key problem - which may or may not be coincidental - is that the kingdom slid into recession during the second

quarter of 2017, and is flat-lining for the year as a whole. This has led many experts and regular citizens alike to argue that the government has hit the fiscal brakes too hard, and that it needs to consider fiscal stimulus to boost private

investment. The government‘s decision to retrospectively cancel public-sector salary cuts earlier this year suggests that

policymakers are sympathetic to this view, as does the reconsideration of the speed of subsidy cuts.

In ―standard‖ economies, the deficit hawks versus doves debate is quite bitter and highly politicised, because it ties into

the broader progressive versus conservative controversy over the extent of government involvement in the economy. When economists analyse the issue dispassionately, the debate revolves around the role of the business cycle.

The departure point is the assumption that the economy organically grows at a consistent rate, driven by technological progress. In the short run, events such as a financial crisis push the economy away from this long-run growth rate, but

in a mean-reverting manner, meaning that periods of above-average growth (booms) are followed by compensating

slowdowns, while periods of below-average growth (recessions) are followed by compensating accelerations.

The controversy usually revolves around how to tackle recessions. Doves believe that targeted expenditure by the

government can speed up the process of putting idle resources to work again, meaning that there is a trade-off between austerity and economic growth. Hawks regard recessions as part of the economy‘s auto-corrective dynamics,

and argue that government stimulus disrupts and delays the organic process of resource allocation; therefore, they

conclude that austerity is desirable whatever the state of the economy.

In Saudi Arabia, however, the aforementioned departure point does not apply, because oil dominates the economy. The

price of oil - the primary source of income for the kingdom - is what statisticians call a "random walk", meaning that it does not exhibit mean-reversion: when oil prices rise above their recent average, this does not increase the likelihood

of a subsequent fall in the price of oil, and nor are periods of lower prices - such as the post-2014 crash - indicators of an impending rise in the price of oil. This means that when a recession occurs, unlike in a traditional economy, it does

not represent a temporary mis-allocation of resources; it is much closer to a permanent decrease in the standard of

living.

As a result, rather than accelerating the return to normality, a fiscal stimulus merely represents a softening of the blow.

And if the stimulus is fiscally unsustainable, then sooner or later, it will be withdrawn and the economy will fall back to its new, worse state.

In such a situation, analysts should emphasise the primary benefit of austerity, which is that it gives the government

credibility in its claim that it will settle its debts. This encourages local and foreign capitalists to invest, as they need not

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fear the possibility of random expropriation of their assets to settle debts, or defaults which lead to a collapse in the

value of their investments. It is no coincidence that the Saudi government is pursuing austerity at the same time as it is tackling corruption or launching mega cities - the common thread is attracting foreign capital.

Therefore, in Saudi Arabia, it does not make sense to delay austerity until ―the economy gets back on track‖, because it is basically already shifted to the new track. If there is a risk that austerity will generate political instability, then

stimulus can be used to buy time. But proponents of a stimulus need to appreciate that the traditional role it plays in

advanced economies is absent in oil-dependent ones such as Saudi Arabia.

Moreover, the austerity versus stimulus debate is independent of the conservative versus progressive debate;

differences in position by well-informed analysts reflect differences in short-run versus long-run considerations, until Vision 2030 (hopefully) succeeds, at which point the Saudi populace can look forward to the traditional ideological food

fights.

Source: The National

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WATCH OUT FOR INDIRECT VAT COSTS ON

PROPERTY DEALS Wednesday, November 22, 2017

With the value added tax (VAT) kicking in on January 1, 2018, end-users in Dubai are confused whether to pre-pone

their property purchase decision or to continue paying rents and wait for sales prices to bottom out.

As per the VAT regulations, developers enjoy a zero rate on all residential sales within three years of completion of a

project. Any home sale done after those three years will come under the five per cent VAT levy.

However, residents need to watch out for the indirect costs arising from property transactions.

"There will be no direct effect of VAT on unit costs as prices of new residential sales is zero rated and residential leasing

is exempted. Nevertheless, indirect costs coming from the ancillary processes of transactions and construction will have an inflationary effect on the final prices over time, that we estimate to be from three per cent to five per cent. Services

in the building life cycle such as acquisition services, mortgage charges, construction and property management, maintenance charges, etc., are expected to see a more direct effect from VAT," says David Godchaux, CEO of Core

Savills.

Market experts call for caution and remind buyers that there were similar concerns when the Dubai Land Department doubled transfer fees on property transactions from two per cent to four per cent in 2013. Such short-term blips are

unlikely to affect buying behaviour.

"Markets adjust to these transaction levies and the reality is that even after VAT, UAE levies on real estate are very

competitive when compared to the developed world," says Hussain Alladin, head of IR and research at Global Capital

Partners.

With attractive property prices and generous payment plans from developers, Dubai appears to be on course for

increasing end-user ownership levels and that trend is likely to continue, regardless of the VAT levy.

Meanwhile, for those sitting on the fence waiting for prices to bottom out, it will be wise to defer your decision no

longer.

"Whether Dubai property prices have bottomed out or not depends upon the location and individual development as

there are varied drivers affecting sales prices in different communities and districts. Generally, we expect further room

for softening, particularly in areas witnessing a spike in new and off-plan launches in the lower market segment as competition by a few developers on low pricing are pulling the area averages down and sometimes dampening recovery

of the re-sale market as well," adds Godchaux. Some experts believe a turnaround is on the horizon, with green shoots appearing in certain communities such as the

Palm Jumeirah and Jumeirah Village Circle since the beginning of the year.

"Given the supply and demand dynamics at play, investors should not expect double digit returns this time around, but a slow and steady recovery as fundamentals play themselves out," concludes Alladin.

Source: Khaleej Times

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WHY PROPERTY INVESTORS MUST LOOK

BEYOND THE TALK OF DOOM AND GLOOM Tuesday, November 21, 2017

The hand-wringing continues unabated. Despite the fact that now throughout the year, there has been a steady uptick

in transactions, analysts (against the background of an economy that has proven resilient to the economic concerns) would now have you believe that off-plan transactions are actually bad for the market. In a curious case of statistical

errors, no off-plan sales communities are ever included in the market performance (strange in a city where the off-plan market has always been greater than the ready sector); instead, the entire focus has been on payment plans and how

developers will inevitably cut corners in order to maintain their developer margins. A few things need to be highlighted

here such that the rational investor can see through this noise of nonsense and make rational investment decisions:

Investments in off-plan represent investments in the real estate market, do they not? Buying patterns in many

instances show that there is actually less bulk buying than was the case in the first boom-bust scenario; the number of investors in the market continues to tick up steadily and unlike the last cycle, there have been far fewer cases of

developer defaults. Rather than celebrating the positives, the emphasis continues to be on the fact that this is another

bubble waiting to burst. Even when payment plans have not been offered, areas such as Dubai South have boomed, attracting money flows and making it the most truncated off-plan community this year, a more than 10-fold increase on

a year-over-year basis. This attests to the fact that at the right price, investors will commit, reverting to the fundamental maxim of real estate, which is all about future location.

Developer margins in the UAE have been steadily eroding in the second cycle (from inflated above world average

norms). This is healthy, and despite the concerns being expressed, there has been no outbreak of developer defaults and/or a surge in litigation. This attests to the strength of the regulation that has been put in place by the Real Estate

Regulatory Authority (Rera), a framework that is now being emulated in other parts of the world.

In industry terms, the normalisation of margins is a process that will continue; tier one developers will continue to

attract a premia; for the rest, the temptation will remain to "over-promise"; however, regulatory oversight that has already corrected some of the more egregious examples over the years, is continuously evolving, and will likely make it

more difficult for blatant abuse to take place.

The larger point, however is this: regulation cannot catch everything and investors will sometimes be taken advantage of in any market. What is of importance is whether such incidents are going down, and the data unequivocally points to

the conclusion that it has. Curiously, this is something that is yet again not even spoken of, let alone highlighted.

Investors appear to have made smarter decisions this time around; rather it is the analyst community that for the most

part has not only forgotten its audience, but perhaps more importantly, has lost sight of the bigger picture. Dubai's real

estate market is a structural bet on the growth of the city, both in terms of domestic population count, as well as its status as a regional and global hub. This has been no different since 2002, and despite the first boom-bust cycle, the

money flows have continued to increase.

This is not to say that there are no concerns; regulator oversight is a continuous exercise and market movements are

always prone to bubble-like overshooting of fundamentals. However, the role of sentiment is symmetric; and sentiments can make markets undershoot as well as overshoot.

As markets develop, regulation comes in and plays its role in improving not only the structural efficiency of the

marketplace, but also its microstructure. Perhaps it is time, similar to equity research in the West, investment research comes under the regulatory ambit in the real estate sector as well; making analysts responsible for their methodologies

can certainly be no bad thing in the best of times. In current times, the need is all the more pressing.

Source: Khaleej Times

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WHY INVEST IN REITS VS DIRECT

PROPERTY OWNERSHIP Tuesday, November 21, 2017

For many investors, owning property is a means of growing and diversifying their investment portfolio and strategy. In

most recent years, developers started introducing residential projects into the Dubai market at a price point which has opened the opportunity to a wider buyer pool. The numerous options and the softening of prices have motivated first-

time buyers to purchase property.

While some may view the current market conditions as a promising time to enter the real estate market, the cost of

purchasing and owning a property remains out of reach for many. These barriers to enter the real estate market can

discourage potential investors from giving real estate a second thought.

Owning a property and becoming a landlord offers more control and a better chance of recognising big returns,

however it also comes with a long list of requirements, such as managing the property, collecting rent and responding to maintenance issues, to name a few. Also, if the owner does not live in the same country, hiring a management and

leasing agency to handle these tasks will require an extra cost to the landlord. This is all in addition to the exposure the

investor has, especially if the market conditions are not favourable and the rental income does not cover any mortgage payments, which may be associated with the property.

For many investors, this fact might close the opportunity door for property investment, but for those who see value in the real estate market and are looking for a viable alternative, an option does exist: real estate investment trusts, or

Reits.

A Reit is a company that owns, and in most cases, operates income-producing real estate. Reits may own property ranging from office, apartments, hospitals, etc. Certain Reits may even specialise in a specific sector, such as healthcare

and only purchase property related to that sector. Regulations require Reits to pay out the majority of their net annual income as dividends to investors. In the UAE, this requirement is 80 per cent.

Reits give individuals an opportunity to invest in diversified pools of income-producing real estate without having to own any property. The main advantage of buying Reit shares versus outright property ownership is this simplicity.

Another advantage is that the investor has the flexibility of setting the amount to be invested in buying Reit shares

based on their financial capabilities. It is important to note that a publicly traded Reit does not usually have a minimum requirement for the number of shares to be purchased, however typically they must be purchased in multiples of 10.

As in any investment, there are certain risks associated with purchasing Reit shares. Decreasing occupancy rates of assets within the portfolio will ultimately hurt the revenues and therefore the dividend payout. Additionally, the share

prices can drop if the property values decrease and much like stock markets, the share prices can dip and fall based on

supply and demand of shares.

Reits have started to emerge in the GCC region with six publicly listed Reits to date. There are currently three in Saudi

Arabia, one in Bahrain and two in the UAE. The two Reits currently listed on Nasdaq Dubai are Emirates Reit and ENBD Reit which offer the opportunity to invest in a diversified portfolio of properties across several real estate assets.

With the potential for more Reit launches in the UAE market, Emirates Reit announced earlier this year, Equitativa Reit, the first residential-focused Reit as well as Abu Dhabi Financial Group announcing its intention to launch the IPO for

Etihad Reit.

Reits are still in the early stage of development in the UAE and the region, therefore there are still some challenges to tackle ahead, namely the lack of investment-grade product to add to the portfolio.

Source: Khaleej Times

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GUARANTEED RETURNS ON OFF-PLAN ARE

TOO GOOD TO BE TRUE Sunday, November 19, 2017

Guaranteed return on investment is a frequent inclusion in recent off-plan marketing by developers in the UAE as they

seek to set themselves apart in enticing investors where interest may otherwise wane. Such offers certainly attract attention, however, where one is contemplating investment solely on the basis of such an assurance, it may be useful

to deconstruct the deal and assess the legal framework under which such offer is issued.

Legally, 'guaranteed rental return' schemes are permissible in the UAE to the extent that the developer complies with

real estate laws and regulations in Dubai, particularly pertaining to off-plan sales and the Jointly Owned Property law.

Off-plan sales are strictly regulated by the Dubai Property Law and the particularities of jointly owned property are maintained and prescribed by Law No. 27 of 2007 where certain disclosures are mandatory as per the sale contract.

The above legal directives assist in providing a framework to ensure that investors understand the nature of their investment, enabling foresight and access to information to hold developers as well as property management firms to

acceptable industry standards. However, whether regulations have developed to safeguard investors under such

schemes and the existence of recourse in the event of breach or termination of contract remains to be seen.

At first glance, deals offering guaranteed return for a specified period may be attractive to investors. However, before

signing up, I would caution that investors avail all resources, legal and otherwise, in assessing possible eventualities at the outset in order to determine whether such investment really is the guarantee it purports to be.

Questions to ask

Preliminary assessment of the potential investment should involve answering the following pertinent questions:

a) Is the property purchase price reflective of the market at the point of sale? In determining whether the property is a

viable deal, market evaluation should be the starting point.

b) Reputation and capacity of the developer: A clear indicator of enforceability of guarantee would be the repute of the

developer in the market and whether they have successfully delivered on such undertakings in previous and other instances.

c) The likelihood of achieving the same return post expiry of the guarantee period. Calculation of the properties'

anticipated insurance and maintenance charges as well as the facilities and location of the project may provide an indication as to whether the return will continue post contract.

Perhaps, the most important consideration, however, is the mechanism underwriting the return guarantee.

Although regulations provide guidance on disclosure in the instance of jointly owned property and registration

processes in off-plan sales, the regulatory framework guiding the issuance of guarantee rental return is fairly limited in

this jurisdiction and ultimately, investors will bear the burden in the event that recourse is sought against a developer that fails to deliver as agreed.

Contracts governing the terms of off-plan sale with guaranteed rental return are often issued by the developer marketing the project and, due to a lack of independent regulation surrounding the terms of issuance of such

guarantees, they are typically able to dictate terms. In the absence of strict regulatory requirements, little assurance or substance may be attributed to such undertakings.

Provisions are often loosely termed in order to provide one-sided cancellation clauses that permit the developer to

retract the guarantee "subject to" conditions determined by the developer and possibly the ability to terminate the agreement at any time.

Legal remedy available

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Investors should, therefore, acquaint themselves fully with the terms and conditions of the agreement, what it contains,

how its mechanisms are likely to work throughout the contract period and what their rights are under the agreement. Preparation for the possibility of default or termination by the developer as well as understanding of legal remedy

provided both contractually and as per the law of the UAE may reveal somewhat limited recourse available.

At this stage, and at all times dependent upon the terms of the agreement executed between the parties, it is likely

that the courts, alternatively arbitration, would be the forum for adjudication of such a claim. However, it is important

to note that security is not formally required to be furnished by a developer proposing guaranteed rental returns and the caveat provided as per contract may provide adequate protection to a developer that seeks to avoid liability should

a claim be instituted by an investor hoping to enforce developer obligations.

Independent regulatory bodies as well as more contemplative legal guidelines will no doubt emerge over time.

However, in the interim, investors should conduct a thorough assessment as to whether a proposal that seems too good to be true indeed is.

Source: Khaleej Times

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VAT IN UAE: KEY FACTS ON REAL ESTATE Sunday, November 19, 2017

VAT is set to be introduced from January 2018 in the UAE

The UAE will start implementing a value added tax (VAT) rate of five per cent from January 1 2018, and businesses in

the first phase can start now registering on the website of the Federal Tax Authority (FTA).

As the real estate sector affects most expat lives in the UAE, let us take a look at the implications of the new levy on

this industry.

What is a supply in relation to real estate?

A supply of real estate may include the sale, lease or giving the right in any real estate.

What is a residential building for VAT purposes?

A residential building is a building or part thereof that is intended and designed for occupation by individuals, and

mainly includes buildings which can be occupied by any person as a main place of residence. It does not include:

. Any place that is not a building fixed to the ground and can be moved without being damaged.

. Any building that is used as a hotel, motel, bed and breakfast establishment or hospital or the like.

. A serviced apartment for which services in addition to the supply of accommodation are provided.

. Any building constructed or converted without lawful authority

What is a commercial building for VAT purposes?

A commercial building is any building or part thereof that is not a residential building. Examples would be oices,

warehouses, hotels, shops, etc

Is a residential building subject to VAT?

The first supply of a new residential building within the first three years of it being constructed shall be zero-rated. All

subsequent supplies shall be exempt, even if within the first three years

Does the owner of real estate have to register for VAT?

The owners of residential buildings do not have to register for VAT if they do not have any other business activities. Where owners have other business activities, they should consider their obligations further.The owner of any building

that is not residential, will have to register if the value of the supplies over the preceding 12 months exceeds Dh375,000 or it is expected that they will exceed Dh375,000 over the coming 30 days.

Can a real estate owner recover VAT paid in relation to real estate?

An owner of residential building will not be able to recover VAT in respect of expenses related to the exempt supply of the residential buildings.An owner of a commercial building will generally be able to recover VAT in respect of expenses

related to the supply of the building.

How is a mixed-use building (residential and commercial) treated for VAT?

The rent or sale of a residential part of the building shall be treated as zero-rated or exempt, depending on whether

this is a first supply or a subsequent supply.The rent or sale of a commercial part of the building shall be treated as subject to VAT at 5%.

The tax incurred by the owner on the building needs to be apportioned where there is an exempt supply, and the portion related to the taxable supply (at 0% and 5%) may be recovered.

Will VAT be charged on the property I am renting?

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The rent of residential building will generally be exempt from VAT.The rent of commercial building will be subject to

VAT at 5%.

Source: Khaleej Times

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BAHRAIN HOTEL ROOM RATES IN OCTOBER

SLUMP TO 11-YEAR LOW Thursday, November 23, 2017

Average daily rates (ADR) at Bahraini hotels fell to its lowest October mark for 11 years, according to new data

released by analysts STR.

Hoteliers operating in the Gulf kingdom saw ADR drop by more than 8 percent to BD58.71 in October compared to the

same month last year.

STR also said in its Middle East/Africa October 2017 report that revenue per available room (RevPAR) fell marginally to

BD28.86.

Occupancy rose by 9.2 percent in October but was still below 50 percent at 49.2 percent, the data showed.

STR analysts noted that the year-over-year increase in occupancy came in comparison with a low base from October

2016, adding that the country‘s absolute occupancy level was helped by two events in Manama - the Federation of Afro-Asian Insurers and Reinsurers 25th Conference and the Bahrain International Defence Exhibition and Conference.

For the wider Middle East region, occupancy rose by 3.3 percent to 64.9 percent in October compared to the year-

earlier period.

ADR fell 4 percent to $163.27 while RevPAR dropped 0.8 percent to $106.04.

Source: Arabian Business

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AZIZI STARTS WORK ON 105-BUILDING

COMMUNITY Wednesday, November 22, 2017

Azizi Developments has started construction on its 105-building ‗Azizi Victoria‘ project in MBR City‘s District Seven

precinct. It will take up an area of 33 million square feet and eventually feed 30,000 residential units, a retail district and two hotels. This follows the earlier launch of the Azizi Riviera at the same master-development. ―Azizi Victoria will

further our vision of creating urban living spaces, which will revolutionise the meaning of community living in Dubai,‖ said chairman Mirwais Azizi. Construction is expected to be completed in four phases, with Phase 1 scheduled for May

2019.

Source: Gulf News

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LAND IN DUBAI HOLDS VALUE FOR

INVESTORS Wednesday, November 22, 2017

Land in Dubai continues to hold its own as investors‘ favourite, with such transactions now totalling Dh68 billion.

―Market conditions since 2014 have made it impossible to buy and sell land for profit in the short term, and the emphasis has shifted from speculation to developing plots as a long-term investment,‖ said Firas Al Msaddi, CEO of fäm

Properties. In recent years, fäm has transacted land sales in Dubai worth more than Dh3 billion.

It recently secured land for a Dh700 million development. The company is working with a new entrant to Dubai‘s

property market on a residential tower in Business Bay with an estimated floor plan of half a million square feet. The

land was sold by fäm for Dh150 million.

―We‘ve witnessed a definite upward trend since 2012, particularly in the Business Bay area, for both the value of land

transactions and the size of plots being bought,‖ said Al Msaadi. ―Over the past five years, land sales have increased from Dh482 million to Dh3.3 billion and the size has grown from 731,000 square feet to 2.5 million square feet.

―The master community of the Business Bay has witnessed enormous improvements recently and with the opening of

the new canal extension, has freed up the area for a new range of developments.‖

The consultancy is also working with Saudi-based Artar Real Estate Development on the Mada Residences, a 36-storey

luxury residential tower in Downtown Dubai and which will be delivered on schedule next summer.

Source: Gulf News

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FROM ISLAND LIVING TO A ‗NORMAL‘ LIFE Wednesday, November 22, 2017

Hanne Ripsaluoma, owner of a boho chic resort-wear brand, Dunesi, and mother of two young boys, has lived in Umm

Suqeim 1 for three years. The family swapped their three-bedroom apartment on the Palm Jumeirah for a five-bedroom

villa in the Al Bahwan Complex on Al Wasl road after seven years of island living.

The house boasts a roof terrace, large open kitchen, double garage, external maid‘s quarters and access to a shared

garden, temperature-controlled pool and gym, but it‘s the community and neighbourhood that swung the deal for the Ripsaluomas.

―We loved living on Palm Jumeirah, and still own our apartment there, but as the kids started growing up I was itching for a garden and more of a family home, plus our elder son started at Kings‘ in Umm Suqeim 3,‖ she says.

Hanne knew she wanted to be in Umm Suqeim but had no clear idea whether it should be a compound, standalone villa

or close to the beach or school. The couple viewed around 60 properties.

She says: ―I found a really good estate agent, Sky Land Realty, which specialises in Umm Suqeim rentals, and our

agent, Mihaela, really listened to me and suggested we look at the Al Bahwan complex.

―The fact that it was newly built was a huge bonus, and the friendly, welcoming neighbours, most of whom are also

families, and view of the Burj Khalifa from the rooftop terrace were major decision influencers.‖

The family negotiated annual rental payment in four cheques and minor snagging was the only post-move maintenance issue, leaving Hanne free to design the space.

―It‘s been a gradual process as we obviously had a lot more space to fill, so we started by upgrading our furniture to bigger pieces, like a larger dining table,‖ she notes.

The vast open expanse of the living room, with its blank walls, has been warmed up by a feature chair and several

large-scale commissioned art pieces. Hanne elaborates: ―These were painted by two Spanish artists, who are friends, and they add colour to the space. Filling the house is an ongoing process, but we‘re not cluttered and I think that‘s the

Scandinavian in me!‖

Hanne‘s favourite spot is the large outdoor terrace, her ―Bali-inspired corner‖, where she says the family spends as

much time as possible.

―It‘s the total opposite of the Palm, which was like living in a resort. Here, our terrace at the back of the house looks

onto the communal garden, and is also very private,‖ she says.

Beyond the garden fence, the family is within walking distance of Kite Beach, has a wealth of eateries to choose from on bustling Beach Road and a choice of big-name supermarkets a few minutes‘ drive from the villa.

―If we need it there‘s a clinic two minutes away by car, a pharmacy opposite and Al Quoz with its trendy cafés and parkour academy is just the other side of Shaikh Zayed Road,‖ adds Hanne.

The physical shift has impacted the family in more ways, as she explains: ―It‘s like our whole life moved. We now know

so many people in Umm Suqeim, know everyone in the compound and our life revolves around this area. When we were living on the Palm I thought we were in the middle of Dubai, but this really is the midpoint of the city and it‘s so

easy to get anywhere from here.‖

The only thing missing for Hanne and her husband is more licensed restaurants, but she is happy to stay in Umm

Suqeim as long as the family remains in Dubai.

―If we could buy this house, we would. We definitely mix more with the local community here, compared to the Palm,

and that‘s especially important for our boys. I also like the fact that this feels like a normal life.‖

Source: Gulf News

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BANYAN TREE MAKES A MOVE INTO

RESIDENTIAL SPACE Tuesday, November 21, 2017

The hotel operator Banyan Tree is making its first move into branded residences in the UAE, for a 32-storey project to

be built on Al Telal Street and near the DMCC cluster and Montgomerie Golf Course.

The developer is Sweid & Sweid and will feature 244 units. The Banyan Tree Residences, Hillside Dubai, will be within a

gated community stretching over 110,000 square feet. The official launch of sales is planned for the first quarter of 2018, in conjunction with the completion of the on-site sales centre and show apartment. Completion of the project is

scheduled for the third quarter of 2019. Construction started earlier this year.

Source: Gulf News

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EMAAR DEVELOPMENT‘S BOARD APPOINTS

NEW VICE-CHAIRMAN Monday, November 20, 2017

Emaar Development said on Monday it has elected Jamal Bin Theniyah as its vice-chairman.

This is in accordance with Article 143/2 of the Commercial Companies Law, according to a statement posted on the Dubai Financial Market‘s website.

Emaar Development‘s shares will be listed on the DFM on Wednesday.

Parent firm Emaar Properties shares closed 1.16 per cent lower at Dh7.68.

The DFM General Index closed 0.19 per cent lower at 3,416.72.

Source: Gulf News

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GLOBAL VILLAGE TO HOST FIVE DAYS OF

NATIONAL DAY EVENTS Saturday, November 25, 2017

The Global Village festival park in Dubai on Saturday revealed its special National Day events from December 1 to 5.

All celebrations and events as part of UAE National Day activities at Global Village are included in the ticket price of Dh15 per person.

The giant outdoor attraction will also have extended hours — 4pm to 2am — from December 1 to 5.

Details of the special National Day events can be found at www.globalvillage.ae

Emirati shows

The Belad Al Khair musical theatre production, created as one of the largest ever in Global Village, will be presented twice daily on the main cultural stage from December 1 to 5.

Also, there will be a concert by famous Emirati artist Abdullah Bil Khair at 9pm on Friday, December 1, at the main cultural stage.

There will be traditional Emirati Al Ayala shows in which performers will play drums, duffels, brass instruments and

vocals. Groups will be roaming Global Village throughout operating hours and performing Emirati cultural dances. They will also perform at the main cultural stage multiple times a day during National Day celebrations.

Fireworks

From December 1 to 3, Global Village guests will also enjoy firework displays that will carry the colours of the UAE flag

and reach a height of 200 metres. The display will be accompanied by a variety of musical presentations as it lights up

the skies for five minutes.

Decorations

More than 25,000 UAE flags will be distributed, and the park‘s courtyards will be filled with more than 20,000 flags of the UAE. Balloon artists will welcome children at the entrance and present them with balloons in the colours of the UAE

flag.

Parade of the World

On Monday, December 4, guests will see the Parade of the World, which will showcase the cultures at the park with

more than 300 performers of various nationalities coming together, including multiple Emirati cultural groups.

Source: Gulf News

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DUBAI INVESTMENTS LEAD CONSORTIUM

TO BUY DUBAI COLLEGE CAMPUS Saturday, November 25, 2017

Dubai Investments, a Dubai-headquartered investment holding company, led a consortium of investors to acquire Kent

College Dubai campus through its subsidiary Al Mal Capital.

The company is an anchor investor in the sale-and-leaseback transaction through which the campus has been leased to

the operator on a long-term basis to manage the institution, the company whose shares trade on Dubai Financial Market said in a statement on Saturday. It did not specify the financial details of the transaction, and said the

acquisition is in line with Dubai Investments strategy to build a portfolio of income-generating real estate assets,

especially in the education sector.

Al Mal Capital, which provides asset management and advisory services, structured the deal along with its co-

investment partners.

―This is a landmark transaction. The focus is on building private equity and real estate investment activities in the

coming years,‖ Khalid Bin Kalban, managing director and the chief executive of the Dubai Investments said. ―This

transaction allows Dubai Investments to build on its institutional presence in the real estate sector,‖ he noted.

Dubai Investments is the latest company to acquire income generating real estate assets to maintain a healthy cash

flow. Some of the alternative investment firms and majority of the UAE developers are pushing to increase their annual recurring revenues to offset the impact of slower economic growth. A number of real estate investment trusts, have

also been established in the last few years to the following similar strategies.

―We are committed to expand our assets under management and execute transactions with committed institutional partners in the income generating real estate space both regionally and internationally,‖ Naser Nabulsi, vice chairman

and chief executive of Al Mal Capital said, adding that Al Mal Capital‘s direct investments team is also working to align its investments with that of its clients to deliver yields and long-term capital gains.

Kent College Dubai is a K-12 British curriculum institution with a capacity to accommodate 2,200 students. It started operations in 2016 and is spread over an area of over 560,000 square feet. Kent College Dubai is the first international

campus of Kent College Canterbury from UK, a 130 years old education institution.

Source: The National

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DHL EXPANDS DUBAI LOGISTICS HUB ON

REGIONAL GROWTH FORECASTS Thursday, November 23, 2017

DHL Express, the global delivery firm that is part of Germany‘s Deutsche Post, opened a US$18 million expansion to its

logistics facility at Dubai International Airport (DXB) on Thursday, with its global chief executive predicting strong growth for the Middle East in 2018.

Ken Allen, board member at Deutsche Post AG, DHL Express Division, told The National he forecast upwards of 15 per cent year-on-year growth for the region next year, driven by an expanding e-commerce sector and uptick in global

business sentiment.

―Globally, the firm has recorded [at least] 26 consecutive quarters of growth over 8 per cent, and the Middle East – one of our fastest-growing regions – has seen higher growth than this, of around 10 to 15 per cent and we expect this to

continue, and even get better, from 2018 onwards,‖ Mr Allen said.

In the past decade, global crises such as the collapse of Lehman Brothers, euro-zone uncertainty and the end of the

Chinese boom in 2015/16, which caused commodity prices to plummet, have all hit businesses with a knock-on impact

on international shipments.

Now, said Mr Allen, ―we are entering a golden era where global business opportunities are set to grow around five or

six times faster than they have done for years, driven in part by the e-commerce revolution.‖

With the launch of Mohammed Alabbar‘s UAE e-commerce venture Noon this year, as well as Amazon‘s acquisition of

the UAE‘s souq.com and a rise in start-up activity, ―where entrepreneurs have instant access to a global market via the

internet‖, said Mr Allen, e-commerce was a ―big proportion or our decision to expand our operations in Dubai‖.

The expanded facility at Dubai‘s Terminal 2 spans 13,100 square metres and is planned to serve 70,000 customers

across the Middle East and North Africa, managing an estimated 5,000 shipments per hour – double its current capacity of 2,500 shipments per hour.

The facility is intended to support the region‘s economic growth by facilitating global trade to and from DHL‘s UAE hub.

Announcing the opening, Mr Allen said: ―The expansion of our facility at Terminal 2 in Dubai is the latest investment by

DHL to support economic growth in the country and wider.

―We are confident the new facility will be able to adequately meet increasing demand for faster shipment deliveries, especially with the boom in e-commerce.‖

DHL Express plans to expand its global aircraft fleet by an average of four extra freighters per year in line with projected 8 per cent year-on-year growth for the company as a whole, Mr Allen said, adding that many of those new

planes would cross through the UAE.

The company is also looking at new opportunities to expand elsewhere in the Arabian Gulf, particularly in Saudi Arabia, where it has already opened three new hubs in the past few years to accommodate growth.

There are no plans for acquisitions at present, Mr Allen added. ―We are more interested in investing in our own infrastructure than picking up something else for no good reason; we see adequate growth within our own business for

now,‖ he said.

Source: The National

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'MY TENANT IGNORED THE EVICTION

NOTICE AND FILED THE RENTAL CHEQUE AT

RERA. HOW DO I GET HIM TO LEAVE?' Wednesday, November 22, 2017

I purchased a two-bedroom apartment in February for my personal use in Dubai Silicon Oasis. This is my one and only property in the UAE and it is mortgaged. The property was already rented so, as per the Dubai Court‘s advice, we sent

a 12-month eviction notice on March 9 via the notary public office. The tenant‘s regular contract was expiring on

November 14, whereas the legal notice term expires four months after on March 13 2018. We were chasing him to sign the remaining four-month contract but he did not respond well. To my surprise I then received a document from the

Real Estate Regulatory Agency (Rera) last week, that says the tenant deposited a one-year cheque at Rera. This is despite receiving the court‘s eviction notice. How do I proceed further on this matter? AB, Dubai

The confusion here is exacerbated because there is no defined time when to serve the 12 months' notice of eviction for

reason of own use.

Let me explain, on the one hand Law 33 of 2008 states that the notice ought to be served upon expiry of the tenancy

agreement, in other words from just before November 14 2017. On the other hand, some judges at the Rental Dispute Settlement Centre (RDSC) do uphold the one-year notice sent at any time (which is what you have done).

Clearly your tenant did not agree about moving out in March 2018 so went quiet, preferring to lodge the rental cheques

for the following year at Rera. This practice is perfectly legal.

The situation is that you bought the property to live in but your tenant does not want to leave. Your only option is to

file a case at the RDSC. They will access the case and make a final decision.

While I cannot predetermine any outcome, I can say that in the past, some judges have requested another year be

given to the tenant before finally vacating. The law here, however, is not set on precedents so it is also possible that you may win the case; it all depends on the presiding judge on the day.

We are the tenants of an apartment whose ownership changed during the current tenancy contract but it was never

communicated to us officially, nor was the tenancy contract amended with the new ownership. On top of that, the real estate company, that was acting as an agent, closed down. We did not have the contact details of the previous owner

with whom the tenancy contract was signed nor the present owner. As required by law, we had to send a vacating notice 90 days prior to the tenancy contract expiring, but we did not have any details. When we finally got hold of the

agent, she gave us the details via WhatsApp, but by then it was around 63 days before the expiry of the tenancy

contract. We tried to reach the new owner on the phone but were not successful. I also sent the new broker my vacating notice via email, 34 days before the tenancy's expiry. The broker, who is now copying the new owner in via

email, says we were too late in communicating our wish to vacate, so the present owner is now refusing to refund the security deposit once the apartment is vacated. The expiry is December 14. What should we do? RP, Dubai

Law 33 of 2008 amended law 26 of 2007, which is the law that regulates the relationship between landlords and tenants.

It is true that in the past, a tenant had to give 90 days‘ notice if they did not want to renew their contract. Law 33 of

2008 did away with this requirement. In theory, a tenant does not (by law) have to give any notice if they no longer wish to renew their tenancy agreement. In practice, however, it is always good manners to give as much notice as

possible to a landlord (for reason of not renewing) in order for him or her to then be able to find another tenant.

The landlord is not allowed to withhold the deposit for the reason given in your email. The deposit can only be used to

bring back the property to the condition it was given at the start of the agreement or if any repairs or maintenance is

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required. If the landlord insists on his terms, you would be within your rights to file a case at the RDSC; this will cost

3.5 per cent of the annual rent to do so. You will have to weigh this cost against the actual deposit amount to see if it is economically viable to pursue the landlord.

Source: The National

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DUBIZZLE RECORDS RISING DEMAND FOR

HOUSING PRICED BELOW DH1,000/SQ FT Monday, November 20, 2017

"Mid-market" properties were the only price category of the Dubai residential market for which online searches on UAE

marketplace dubizzle.com that rose this year, indicating continued growth in demand for ―affordable‖ housing amid flat market conditions and increasing supply.

The proportion of dubizzle.com searches for mid-market properties – those cheaper than Dh1,000 per square foot – increased to 66 per cent of all property searches on the platform in September 2017, up from 42 per cent in September

2016, according to dubizzle.com and property consultancy JLL‘s End of Year Property Report focusing on the Dubai

residential market.

Mid-market properties accounted for 57 per cent of all property advertisements on dubizzle.com during the month,

compared to 52 per cent last September, the report added. ―The most significant changes in the structure of the market during 2017 have been the growth of off-plan sales and a continued focus on the affordable or mid-income

sector,‖ said Craig Plumb, head of research at JLL Mena (Middle East and North Africa).

In stark comparison, the proportion of searches for properties in the Dh1,000-1,500/sq ft bracket dropped by 13 per cent over the year and 3 per cent for the Dh1,500-2,000/sq ft bracket, with the proportion of listings also dropping for

these brackets, by 1 per cent each.

This apparent redistribution of demand to newer mid-market communities in 2017 is illustrated by individual price hikes

for certain communities, the report said. Average price per square foot rose by 19.1 per cent year-on-year in Discovery

Gardens, 8.22 per cent in Jumeirah Village Circle, 8.01 per cent in Remraam, 4.96 per cent in Dubai Sports City and 3.97 per cent in Liwan.

―Developers in Dubai announced 16 new projects this year – several of them were in the mid-market segment offering attractive payment plans. Agencies who are focused on off-plan sales and have inventory that falls under the below-

Dh1,000/sq ft bracket are likely to see gains here,‖ added Samer Abdin, general manager of dubizzle Property. Overall, the Dubai residential market ―remained relatively soft during 2017‖, according to Mr Plumb, with declining rents in most

locations and little change in average sales prices.

―The sales market appears to be close to the bottom of its current cycle, with little further decline anticipated in 2018. The rental sector may however see further weakness as the market moves further in favour of tenants, making Dubai a

more competitive and attractive city in which to live,‖ Mr Plumb said.

The threat of potential oversupply is one of the largest challenges facing Dubai‘s residential sector in 2018, he warned.

More than 120,000 units have been launched for completion by the end of 2020 and if all of them were to proceed, the

market would ―definitely‖ experience an oversupply. Fortunately, though, the rate of materialisation of those units is low, he said. Previously released JLL data suggests that just 53 per cent of the 32,000 units scheduled for completion in

2017 will be delivered by the end of the year.

Dubizzle Property has around 150,000 listings on its platform at any given time and registers more than 3.7 million

visits per month, it said. Earlier this week, the Dubai Land Department (DLD) updated the emirate's rental index for 2018, adding a land rent index for the first time. "As rents are softening across most districts in Dubai, there is a lot of

'viscosity' and lag in the adjustment, due to the very inelastic nature of the rental market, with rents typically adjusting

only once per year for a given property," said Core Savills‘ chief executive David Godchaux.

Source: The National

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FEARS OF OVERSUPPLY IN DUBAI ARE

EXAGGERATED Tuesday, November 21, 2017

A recent estimate put out by Fam Properties claimed that Dubai will see a further 163,840 properties being built over

the next five years from 387 projects. However, the chief of one of Dubai's leading developers is not perturbed about fears of an oversupply.

Says Hussain Sajwani, chairman of Damac Properties: "The Dubai economy grows at around four to five per cent per year and the city has half a million freehold units. Even if you take four per cent growth, you will need 20,000 homes to

be delivered to the Dubai market every year. In the last three years, we have seen that between 8,000 to 10,000

homes were delivered and we estimate 12,000 units to be handed over this year.

"Next year, there maybe 15,000 units delivered. This is still short of the supply needed to balance demand in Dubai.

Fears of oversupply are blown out of proportion."

The developer has delivered 2,000 units across its portfolio this year, which include 1,071 units in its master

development Damac Hills (formerly Akoya) and Fendi and Paramount Towers in Saudi Arabia.

Damac's major handovers next year are 2,000 keys at Damac Towers by Paramount on Al Khail Road and Damac Heights in Marina.

Sajwani also insists the group will exceed its revenue target of Dh7 billion this year.

"Our sales and revenue are up. The numbers are talking since we are a public company, with our results audited every

quarter. Both Emaar and Damac are seeing better growth in comparison with last year. So, where is the sluggishness in

demand? Despite geopolitical risk in the region, Dubai remains a safe haven," reckons Sajwani.

The luxury developer is also launching several units at an affordable price point now. "The good price point in this

market is between Dh1.2 million to Dh1.3 million," the chairman observes.

"Being a luxury developer does not mean you cannot offer a good quality, luxury product to the lower end of the

housing market. We are launching products across the price spectrum and emulating the models of Mercedes Benz and BMW. For instance, they have products starting from Dh70,000 and going all the way up to Dh700,000, but they still

maintain the reliability and look of the brand," he adds.

After taking market share in Dubai, Damac is now exploring development options outside the UAE. Besides an ongoing project in London, the high-end developer has also been chosen by the Oman government for a $1 billion project to

redevelop Port Sultan Qaboos in Muscat.

"We are also developing a resort in Maldives. We are exploring a lot of ideas in overseas markets. We currently have no

expansion plans in the Sub-continent," he clarifies.

Damac is also on the lookout for more land plots in Dubai. "Land is oxygen for any developer. You always need more of it. Damac Hills and Akoya Oxygen are at an advanced stage of build out."

Meanwhile, the Trump International Golf Club which opened earlier this year in Damac Hills is seeing good progress, with 70 to 75 members registered so far. The Trump World Golf Club is on schedule to open next year, informs

Sajwani.

"The Trump brand from a property point of view is synonymous with reliable, high-end products. That's what

customers look for. We are benefitting from it from a development point of view," says the chairman.

Damac has big plans for its recurring income portfolio and is considering 750,000 sqft of leased space across its two master developments. The developer has leased out more than 400 units in Damac Hills. "Every developer has its own

strategy for cash flow. In my view, a smaller developer cannot afford to have units for rent. As you grow big, when you

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have proper income and cash flow, then you can retain units for leasing. This will provide sustainable income," says

Sajwani.

Damac's hospitality unit aims to have 13,000 hotel keys ready by 2020/2021. It has handed over 1,800 hotel keys so

far in Dubai, predominantly in Downtown. "Our revenue from selling serviced apartments accounts for around 35 per cent of our total earnings. The hospitality component enables us to add value and differentiate our product for the

customer. We look upon it as not just a revenue generator but also a service addition to our real estate products," he

concludes.

Source: Khaleej Times

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BANYAN TREE LAUNCHES FIRST ME'S

RESIDENTIAL PROJECT IN DUBAI Tuesday, November 21, 2017

UAE-based developer Sweid & Sweid has partnered with hospitality brand Banyan Tree to develop and deliver the first

Banyan Tree Residences in the Middle East.

Located on Al Telal Street, the new 32-storey residential tower will include 244 residences, featuring one, two, three

and four-bedroom apartments, duplex apartments with private outdoor gardens and three full-floor penthouses.

Banyan Tree Residences, Hillside Dubai, is a single tower set within a gated community stretching over 110,000 square

feet. The residents-only clubhouse and spa includes a fitness centre, a Banyan Tree spa, a squash court and an indoor

children's play area.

The developer claims the project has already garnered commitments from private investors. The official launch of sales

is planned for Q1 of 2018. Completion of the project is scheduled for Q3 of 2019, with construction having commenced at the start of 2017.

Ho Kwon Ping, executive chairman of Banyan Tree Holdings, said: "This is our first entry into the emerging branded

residence space in the Middle East. Our offering is unique in that we are giving our end-users the experience of a luxury retreat they would expect from our hotels and resorts. However, there is no end to the holiday. This will be their

home."

Maher Sweid, managing partner of Sweid & Sweid, said: "Construction commenced far ahead of the public sales launch.

Interested buyers can go online and register to be the first to be invited to the launch of the sales centre."

Buyers will also receive membership to the Banyan Tree Sanctuary Club, which entitles them to access to over 40 resorts and hotels, more than 60 spas, 70 retail galleries and three golf courses worldwide.

Source: Khaleej Times

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5 LOCATIONS THAT OFFER CHEAPEST

RENTS IN DUBAI Monday, November 20, 2017

Suburban communities offer better value for money, allowing tenants to save on their current lease.

The updated Dubai Rental Index announced on Saturday will bring welcome relief to cash-strapped tenants. For those who may have been paying inflated rents, this is their chance to renegotiate with landlords and bring their rents down

to the market average - or upgrade to a posher locality or larger units. There is also more supply coming to the market, which will further weigh on rents.

In the ever-growing city of Dubai, the suburban effect is also currently underway. Tenants in search of bigger living

spaces at affordable prices are moving away from established communities along the Sheikh Zayed Road corridor to those along the Mohammed Bin Zayed Road and Al Qudra Road.

"Dubailand and Jumeirah Village Circle (JVC) and Triangle (JVT) are emerging as the most competitively priced rental districts. The substantial number of future deliveries in these areas are expected to sustain pressure on rental levels

and continue attracting tenants. Closer to the date of Expo 2020, we expect areas around the Expo site such as Dubai

South to also start seeing rental activity increase as projects currently under construction are handed over," says David Godchaux, CEO of Core Savills, a real estate consultancy.

Suburban communities offer better value for money, allowing tenants to save on their current lease or upgrade to a larger sized unit for the same rental value.

Due to an increasing number of new buildings being handed over, Dubailand, Al Warqa, Dubai Silicon Oasis, Al Furjan

and JVC have emerged as locations preferred by mid-income families.

"Communities such as Mira, Mudon and Nshama offer affordable rates compared to their more established counterparts

on Sheikh Zayed Road. For example, a rental comparison between two Emaar villa communities on opposite corridors - the Springs and Mira - reveals a 22 per cent discount for the latter which is located on MBZ Road. We expect there to

be a greater movement towards the outskirts of Dubai as more suburban communities develop," reckons Hussain Alladin, head of IR and research at Global Capital Partners.

Other popular affordable communities for mid-income families are International City, Discovery Gardens, Al Nahda and

Al Qusais.

"There is a clear trend for more affordable two and three-bedroom apartments in the north and north-eastern side of

Dubai, primarily on the border with Sharjah.

This has made northern Dubai more attractive for Sharjah residents who work in Dubai, willing to shorten their daily

commute times," observes Cheryl McAdam, valuation manager, ValuStrat, a strategic advisory firm.

Households with a monthly income of Dh15,000 are opting for two-beds in Al Nahda, Al Qusais, International City, Liwan and Al Warqa. Average rents for two-bedroom apartments here range from Dh60,000 to Dh70,000 per annum.

Households with monthly income of Dh22,500 to Dh27,500 can consider three-bedroom apartments for an annual rent of Dh90,000 in areas such as Al Nahda, Dubailand, Dubai Silicon Oasis, Al Qusais and Liwan.

At the other end of the spectrum, those with substantial disposable incomes are still spending big bucks on their leases. "The top luxury rental areas in Dubai for families are Jumeirah Golf Estates [where average annual rent is Dh414,600],

Palm Jumeirah [Dh517,500], The Lakes [Dh545,800], Polo Homes in Arabian Ranches [Dh715,000] and Emirates Hills

[Dh1,270,000]," explains Ryan Kasper, luxury rentals director at LuxHabitat, a high-end property brokerage.

Source: Khaleej Times

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DAMAC LAUNCHES SPECIAL SALES EVENT

FOR VILLAS Sunday, November 19, 2017

Damac Properties has announced a one-day sales event on a selection of its luxury villas at Akoya Oxygen.

The event will be held on November 25, from 10am to 8pm, at all Damac sales offices, including Park Towers, Al Manara, Ocean Heights and Damac Hills. Villas are available in a variety of sizes, including three, four, five and six-

bedroom units, with front and backyards, at Akoya Oxygen.

"We're providing investors with a chance to own one of these attractively priced luxury villas in a thriving golf

community, with prices designed to suit a range of budgets, from as low as Dh999,999," said Niall McLoughlin, senior

vice-president, Damac Properties.

"Investors or end-users with families will be pleased with the array of sizes and locations, however stocks are limited.

The stand-alone 6-bedroom option presents real value for larger families who seek additional space."

Source: Khaleej Times

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MILLENNIUM TO OPEN MIXED USE HOTEL IN

DUBAI'S MIRDIF HILLS IN 2018 Thursday, November 23, 2017

Millennium & Copthorne Hotels and Resorts is set to open a mixed-use property, Millennium Place, by the first half of

2018 in the AED3 billion Mirdif Hills project in Dubai.

Millennium‘s property will feature 116 hotel rooms and 128 serviced apartments, as well a gym, swimming pool and

meeting spaces.

The group currently has 32 hotels in operation, 14 set to open in 2018 and 40 in the pipeline.

Speaking to Arabian Business, Middle East and Africa chief operating officer Kevork Deldelian said the group expects to

provide 4,000 jobs through the region with its overall upcoming projects. It currently has 5,600 individuals working in its 32 operational properties.

―We‘re going into more sizable operations and bigger hotels, so we‘re almost doubling the manpower and increasing it quite a lot on the recruitment,‖ he said.

The group‘s upcoming projects in the UAE include Studio M hotel in Al Barsha and Grand Millennium Bay Views in

Business Bay, both to open by end of 2018.

But Deldelian said Millennium‘s most important market right now is Saudi Arabia.

―We are also opening in Saudi, where we see serious growth for the company. We have the Grand Millennium Airport Hotel, Millennium Al Naseem and Copthorne Al Naseem, all to open in the first quarter 2018. We have had several

success stories in 2017 as well, when we took over some unique properties in unique locations.

"The most prominent one is the takeover of the Makkah Hilton, the hotel and towers have been rebranded to Millennium Makkah hotels as of September 1, 2017. This gave us three properties in Makkah, with two more coming up

next year with Al Naseem. So Saudi, strategically, is where we are growing,‖ he said.

Source: Arabian Business

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ABU DHABI HOTEL RATES ZOOM DURING F1

WEEK Saturday, November 25, 2017

There is a price to be paid for watching the F1 from a ringside seat.

Abu Dhabi‘s average daily hotel rates are higher by a staggering 265 per cent during the Grand Prix week compared to the rest of the year. In this, Abu Dhabi hotels are placed second among cities hosting the annual F1 races. The

emirate's hotels are behind Monaco, where rates shoot up 499 per cent during race week, and ahead of those in Sao Paulo, where rates go up 165 per cent.

So, while for the rest of the year Abu Dhabi hotel rates are among the ―most competitive‖, during the Grand Prix, they

shoot up to second spot, according to an update from Core Savills.

These are based on rates across the seven hotels within a 5-kilometre radius of the track. In comparison, Singapore

has 186 hotels within such a vicinity, while Monaco has 59.

But the spike all through the race days hasn‘t impacted on the occupancy levels at Abu Dhabi hotels. ―Average

occupancy and RevPAR (revenue per available room) also surge throughout the month,‖ Core reports. ―This may also

be attributed to the fact that Abu Dhabi‘s tourism calendar is yet to be fully diversified with other prominent events.

―However, the city is now broadening its cultural and tourism offerings to sustain demand throughout the year, as

evidenced by the developing Cultural District on Saadiyat Island and the opening of the Louvre Abu Dhabi.‖

Abu Dhabi‘s hospitality sector has been holding up well despite the overhang of a weak economy through the last three

years. According to Mastercard data, Abu Dhabi was the ―fastest-growing destination city for tourists in the Middle East

and Africa during 2017‖.

Plus, the opening of the Louvre is ―likely to have given the capital‘s ranking the strongest boost by improving its

attractiveness as a cultural destination‖, Abu Dhabi is also ranked third globally in terms of the growth of international overnight visitors it receives. Dubai remains fourth overall in the world in terms of total overnight visitors.

The race isn‘t the only attraction the location – Yas Island – will be hosting. In the coming weeks, residents will start moving into their new homes, part of the initial communities the master-developer, Aldar Properties, is handing over.

Plus, there are the Yas Mall and the Ferrari theme park for good measure.

―Abu Dhabi‘s Grand Prix poses a number of interesting potential drivers for real estate in the surrounding districts,‖ the Core report notes. ―Other large entertainment and leisure facilities located in the area… all work towards creating

momentum in the area.

―This, in turn, is likely to strengthen the attractiveness of real estate in the surrounding areas by creating a sense of

vibrancy and prestige, indicating the potential for government planning to create further value and generate greater

demand.‖

Source: Gulf News

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SHARJAH BEACH TO BECOME MAJOR

TOURIST ATTRACTION Saturday, November 25, 2017

Sharjah Beach is being transformed into a major leisure and tourist attraction, featuring walking and cycling lanes, a

seating wall, cafés, landscaping, and much more, officials announced on Saturday.

The Sharjah Beach Development Project has been approved by His Highness Dr Shaikh Sultan Bin Mohammad Al

Qasimi, Member of the Supreme Council and Ruler of Sharjah.

The project, which will develop a 3.3km stretch along Sharjah Beach Road from Sharjah Ladies Club to the Ajman

border, is part of the strategic plan of the Sharjah Urban Planning Council (SUPC).

The seafront promenade will include changing rooms, prayer areas, food trucks, art spaces, public squares, shaded areas, water sports space, and greenery. There will also be parking for 1,100 cars on both sides of the road.

Shaikh Khalid Bin Sultan Al Qasimi, chairman of SUPC, said the council has made an extra effort to develop a unique design to meet the ambitions of Shaikh Sultan and to enhance the quality of life of the emirate‘s residents.

Shaikh Khalid added: ―We are working in cooperation with other government departments, involved in the project, to

play our pivotal role and further improve the standard of living Sharjah.‖

Khalid Mohammad Al Ali, secretary-general of SUPC, said: ―The council is keen to give priority to the implementation of

specific projects that will form the nucleus of the transformation being implemented by the council to improve and develop infrastructure, utility and public services in Sharjah, especially its waterfront areas.‖

Al Ali added that the natural elements of the landscaping of the project have been carefully chosen to enhance its

aesthetics and further improve the quality of the environment to ensure visitors‘ comfort. He said local species of heat- and drought-resistant plants have been selected to ensure sustainability of the project.

―To meet the needs of a healthy lifestyle, the beach promenade offers different areas for walking, as well as a bicycle lane, which will be linked to a future integrated citywide network. Additionally, a seating wall will span most of the

project offering a place for viewing the sea and relaxation,‖ Al Ali added.

Sharjah Beach project

3.3km of promenade areas

Five beach areas

Around 1.5km of ‗seating wall‘ along the beach

Five different plazas dedicated to community and artistic events

Picnic areas with seating and tables

Fitness areas

Parking spaces for up to 1,100 vehicles

Source: Gulf News

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CRESCENT ENTERPRISES ANNOUNCES NEW

$150M VENTURE CAPITAL DIVISION Thursday, November 23, 2017

Sharjah-headquartered diversified holding company Crescent Enterprises has announced the launch of its new

corporate venture capital division with plans to invest up to US$150 million (AED548 million) over the next three years. The announcement was made at the Sharjah Entrepreneurship Festival (SharjahEF), organised by the Sharjah

entrepreneurship centre, Sheraa, this week. According to the company CEO Badr Jafar, Crescent Enterprises has invested in a new business every month for the last six months and the new division is a move to formalise the

structure of its venture capital investments.

The new venture capital division of Crescent Enterprises will focus on strategic direct investments in early to later-stage start-ups and is sector-agnostic, although half of the funds will be dedicated to investing in ventures from the Middle

East and North Africa (MENA). Recent investments by the company include a Silicon Valley-based drone company, a robotic surgery technology venture and an e-commerce platform for fisheries in India. Crescent also recently provided

seed capital to graduates from the American University of Sharjah to develop a project management system using

artificial intelligence (AI).

Over the years, Crescent Enterprises has made strategic investments in funds managed by the Abraaj Group,

Growthgate Capital, Wamda Capital and TVM Healthcare. Crescent Enterprises established CE-Ventures in 2014, as an internal incubator to develop start-ups that generate a sustainable social impact. The incubator conceives and develops

businesses across a wide range of industry sectors and has already launched two businesses so far.

Earlier this year, Crescent Enterprises formed a partnership with Sheraa to create joint initiatives that will harness the potential of young entrepreneurs to generate positive social impact through economically viable and scalable startups.

The first initiative of the partnership is a two-year pilot programme consisting of 10 mentoring events for young entrepreneurs and three social enterprise challenges that encourage students to collaborate on developing innovative

applications for social good.

Crescent Enterprises has interests in business aviation, business incubation, power and engineering, healthcare, private

equity, and ports and logistics. The company employs more than 4,500 people in 22 countries across five continents,

via its 20 subsidiary and affiliate companies.

Source: Sharjah Update

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INTERNATIONAL VISITORS DRIVE RAS AL

KHAIMAH'S TOURISM AMBITION Thursday, November 23, 2017

Ras Al Khaimah has notched up a new record for international visitor arrivals, with the first 10 months of this year

seeing the emirate register a 12 percent surge.

The emirate, which has been diversifying its tourism product into the adventure activity sector, is within striking

distance of its 900,000 target for this year, a statement said.

―International arrivals are showing the strongest growth with the emerging markets of the Czech Republic, Poland,

India and Kazakhstan greatly contributing to this healthy performance,‖ said Haitham Mattar, CEO, Ras Al Khaimah

Tourism Development Authority (RAKTDA).

―These new source markets are contributing to continuing strong results from Germany and the UK and a much

welcome bounce-back in the number of Russians choosing to vacation in the emirate.‖

Ras Al Khaimah has witnessed increases across all key growth indicators in October. Hotel occupancy edged up by 1

percent to 69 percent, guest nights climbed 14 percent, while the average length of stay rose 8.89 percent to 3.3 days.

―We are now receiving more guests than ever, they are staying longer than ever and spending more, which is a direct result of product diversification and an uplift in our events calendar,‖ added Mattar.

The first 10 months of this year saw a 65.25 percent year-on-year increase in Russian visitors, while 17.28 percent more British visitors holidayed in the emirate.

The Indian market has produced a 19.23 percent lift in arrivals, while Czech visitors climbed by 62.43 percent, the

number of Polish visitors trebled, there was a 22.49 percent increase in the number of Slovaks opting to vacation in Ras Al Khaimah, while arrivals from Saudi Arabia also increased by 5.97 percent.

―We are now very well placed for meeting our 2017 visitor target and with the imminent launch of the world‘s longest zip line in the Hajar Mountains around the UAE‘s highest peak, Jebel Jais, we envisage a corresponding rise in the

number of adventure tourist arrivals,‖ said Mattar.

RAKTDA is looking to reach one million tourist arrivals by the end of 2018 and is gearing up for a raft of new hotel and

resort openings planned to meet increasing demand. An additional 4,445 hotel and resort rooms are expected to come

on line in the emirate over the next three years.

Source: Khaleej Times

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EXPAT INDIANS ONLY TOO WILLING TO

SNAP UP PROPERTY BACK HOME Wednesday, November 22, 2017

India‘s real estate desperately needs non-resident Indians to start buying. And by the looks of it, they seem willing to

comply.

A survey by the promoters of Indian Property Show shows a rise of 59 per cent in such prospective buyer support

compared to June this year.

And 13 per cent want to buy immediately as opposed to only 8.15 per cent in June; whereas 35 per cent are keen on

buying within next three months itself. In all, 70 per cent of those polled have shown interest in buying in India within

next six months.

Also, in terms of location preferences, Kolkata and Kochi have entered the Top 10, while Mumbai, Bengaluru and

Chennai continue to hold their dominant spots.

Also, 41 per cent of Indian expats are looking to buy within the budget range of R500,000 to Rs5 million, compared to

36.24 per cent last time. There is also a sharp increase in the number of NRI buyers looking to finance their property

purchase — at 67 per cent compared to 53 per cent last time around.

―So many fascinating and positive trends have emerged through this survey and I think we can easily attribute all this

to the renewed NRI confidence in Indian properties,‖ said R. Srividya, General Manager, Credai Indian Property Show. ―The implementation of RERA has surely given a boost to the mood as the sector is transformed and more transparent

now with only credible players.‖

Source: Gulf News

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FOREIGN BUYERS FACE UK CAPITAL-GAINS

TAX ON PROPERTY PURCHASES Thursday, November 23, 2017

The UK government plans to introduce a capital-gains tax on foreign buyers including those in the Arabian Gulf of

commercial property, potentially disrupting the flow of money into London office buildings in the wake of Brexit.

The tax would be levied on gains made by non-residents on sales of all types of UK real estate, extending existing rules

that apply only to homes, according to a consultation document published alongside the chancellor of the exchequer, or finance minister, Philip Hammond‘s budget on Wednesday. Some institutional investors may be exempted from the tax

changes, which the government aims to introduce by 2019.

―This seems likely to have significant implications for the investment market, particularly London,‖ said Walter Boettcher, the chief economist at Colliers International Group Inc. ―There is talk of exemptions for pension funds, but

we await clarity and indications on how the market might react.‖

Overseas investors dominate London‘s property market, lured by big buildings with long leases to major corporations

and a stable legal environment. Foreign investors currently account for about 75 per cent of central-London investment,

according to research by Colliers.

The UK is the largest commercial property market in Europe, attracting €26.7 billion (Dh 116.21bn) of investment in the

first half of 2017 even after the Brexit vote, slightly more than the 26.1 billion euros invested in Germany, according to a report published by the broker Savills. ―We are deeply concerned that the chancellor‘s announcement on capital gains

tax, which will now apply to non-resident investors, will jeopardise much-needed investment,‖ said Ion Fletcher, the

director of finance policy at the British Property Federation. ―The UK is particularly good at attracting overseas investment capital, much of which goes towards regenerating our towns and cities.‖

The London office market has a long track record of attracting capital from all over the world, including sovereign wealth funds including from the GCC, global pension funds and the world‘s super-rich, many Arabs among them.

Corporations from Hong Kong and China have been the dominant buyer of large buildings in the City of London district since the Brexit vote, with deals including the £1.15bn (Dh5.62bn) purchase of the Leadenhall building by CC Land

Holdings and LKK Health Products‘ £1.28bn acquisition of 20 Fenchurch Street.

―Unlike most other major jurisdictions, the UK does not currently exercise its full taxing rights where non-residents dispose of non-residential property,‖ the consultation document said. ―This puts non-residents at an advantage over UK

residents. It also drives the creation of complex offshore structures to hold property, which can facilitate avoidance.‖

The new rules would also apply to investors buying companies that own buildings, as well as those directly purchasing

assets, the consultation document shows. The planned change is due to come into effect in April 2019 and the tax will

be levied on prices gains which occur after that date. ―Investors impacted could include private equity, real estate funds and wealthy individuals,‖ the JPMorgan analyst Tim Leckie wrote in a note to clients Thursday. ―If implemented, this

could drive a price correction through the market.‖

UK real estate investment trusts that develop London offices, including Land Securities, British Land, Great Portland

Estates and Derwent London, have been net sellers in the UK capital for several years, taking advantage of high prices and selling to overseas investors. British Land is in the process of offering its stake in the London headquarters of UBS

for sale and Great Portland Estates expects to divest about £400 million of London property in the months ahead, the

company said in a November 15 earnings statement.

―Longer term, this could be a positive for UK REITs, which would face less competition for assets and higher initial

yields, boosting the evolution into an income-driven total return sector,‖ Mr Leckie said.

Source: The National

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ASSET MANAGEMENT SALES LEASING

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ORASCOM CONSTRUCTION SAYS THIRD

QUARTER NET INCOME SLIPS 13.8 PER

CENT, DRAGGED DOWN BY US BUSINESS Tuesday, November 21, 2017

Orascom Construction, the Dubai-listed builder, said third quarter net income fell 13.8 per cent as losses from its operations in the US outweighed gains from those in the Middle East and North Africa that have become more

profitable amid an increase in government infrastructure spending.

Net income attributable to shareholders dropped to $22.4 million in the three months ended September 30 compared to $26m in the corresponding period last year. Losses from the company's business in the US widened 47.6 per cent in the

period to $38.2m from $25.9m from the same period a year earlier.

"In Egypt, we reinforced our role as a leading player in the development of Egypt's infrastructure and new cities as we

signed several new projects including a wastewater treatment plant that will serve 6 million people and the landmark

cultural center in the New Administrative Capital," said Osama Bishai, the company's chief executive officer.

In the MENA region, the company saw a 21 per cent increase in net income to $44m in the third quarter from $36.4m

in the corresponding period last year, boosted by new business in Egypt where the company has traditionally received a big part of its business.

The company said it added $800 million of new projects in both the Middle East and North Africa and the US during the

third quarter. It didn't give a reason however for the widening loss from its US business during the third quarter.

Source: The National

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ASSET MANAGEMENT SALES LEASING

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REFORMS INSPIRE MORE UAE NRIS TO BUY

HOMES IN INDIA Wednesday, November 22, 2017

70 per cent NRIs have shown interest in buying their dream home in India within the next six months

The implementation of the Real Estate (Regulation and Development) Act (Rera) and the Goods and Services Tax (GST) NRIs has inspired more Indian expats in the UAE to invest in a property back home.

A survey conducted by the Indian Property Show reveals an increased urgency among UAE Indian expats to purchase a property back home, showing a rise of 59 per cent compared to June this year. The survey found that 13 per cent want

to buy a home immediately as opposed to only 8.15 per cent in June; whereas 35 per cent are keen on buying within

the next three months, compared to 16.23 per cent earlier - indicating a steep rise of 115 per cent.

In all, 70 per cent NRIs have shown interest in buying their dream home in India within the next six months, up by 44

per cent a few months ago.

The study also reflects a sharp increase in the number of NRI buyers looking to finance their property purchase at 67

per cent compared to 53 per cent last time around. Moreover, a large number of young Indian expats, mainly

millennials, are eager to buy their dream home in India.

The younger age group between 18 to 35 years accounts for a significant chunk of people willing to buy properties in

India. This age group has seen a greater increase of 46.73 per cent from 24.7 per cent last time.

Mumbai (21.71 per cent), Bengaluru (11.06 per cent) and Chennai (9.39 per cent) retain their top positions as the most

popular property destinations, while Kolkata and Cochin enter the top 10.

There was a 10.87 per cent increase in people's preferences to buy apartments whereas villas and commercial properties have seen a slight decline in buying intent.

More expats are eager to buy property for their own use at 65 per cent compared to 45 per cent a few months ago. The number of people looking to buy for investment purposes has reduced considerably.

Around 41 per cent Indian expats in the UAE are looking to buy within the budget range of Rs500,000 to Rs5 million.

"The implementation of Rera has given a boost to the mood as the sector is more transparent now with only credible

players. Buyers are feeling more secure and assured," said R. Srividya, general manager, Credai Indian Property Show.

The Indian Property Show has partnered with Credair (Confederation of Real Estate Developers' Associations of India) for its 21st Dubai edition. The three-day exhibition will be held on December 7, 8 and 9 at the Dubai World Trade

Center from 12pm to 8pm. The exhibition will have 14 state pavilions presenting over 60 Indian cities.

Source: Khaleej Times

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ASSET MANAGEMENT SALES LEASING

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NEW JERSEY OFFICE MARKET RENTS

APPROACHING RECORD HIGHS Thursday, November 23, 2017

According to Transwestern's Third-Quarter 2017 Office Market Report, after decades of stagnation, asking rents for

office space in New Jersey are steadily rising and nearing an all-time high.

During the past two years, rents have increased by 9 percent - the largest two-year increase since 2001. Furthermore,

the market's current average asking rent of $26.86 is the second-highest quarterly average of all time, nearing the high that was recorded more than 16 years ago.

"The concept of 'service' has taken on greater importance over the past couple of years," said James Postell,

Transwestern Partner and City Leader. "There's been a significant increase in leasing activity among companies in the service sector industries, and tenants have become much more inclined to renew or relocate to properties based on

landlord and management services."

Rents in New Jersey have increased in eight of the past nine quarters, and 16 of the 21 submarkets examined by

Transwestern have experienced year-over-year rent increases, including seven submarkets with rents that are more

than $1 higher than a year ago. The Hudson Waterfront, Newark/Urban Essex, Short Hills/Millburn and Woodbridge/Metro Park submarkets have experienced the greatest increases.

"The long-running perception of the historically unchanging nature of office rents in New Jersey is no longer salient," said Matthew Dolly, Transwestern's New Jersey Research Director. "As the market has evolved, it seems like every

recent office building acquisition in the state is a value-add play where extensive renovations are planned. Significant

property upgrades are accompanied by higher asking rents."

The pace of leasing slowed during the third quarter with fewer large transactions completed - no new leases were

signed for greater than 100,000 square feet, drawing concerns of consolidation. Among the top 12 largest leases signed during the quarter, 10 were new deals, with leasing strongest among companies in the personal services, legal services,

business services and financial services companies.

The State of New Jersey continues to focus on incentives to bolster business growth and retention, as evidenced by

three third-quarter deals:

Billtrust, which signed the largest new lease in the Princeton area, considered Bucks County, Pennsylvania, before being awarded Grow NJ Tax credits to create 200 new jobs in Lawrenceville.

Following approval of Grow NJ tax credits based on its plan to create over 150 new jobs, Nuts.com announced it will create a 24,000-square-foot high-tech workspace in Jersey City.

Source: World Property Journal

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DEFINING LANDSCAPES SINCE 1985 Page 52

ASSET MANAGEMENT SALES LEASING

VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION

U.S. HOME SALES UPTICK 2.0 PERCENT IN

OCTOBER Wednesday, November 22, 2017

According to the National Association of Realtors, existing-home sales in the U.S. increased in October 2017 to their

strongest pace since earlier this summer, but continual supply shortages led to fewer closings on an annual basis for the second straight month.

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 2.0 percent to a seasonally adjusted annual rate of 5.48 million in October from a

downwardly revised 5.37 million in September. After last month's increase, sales are at their strongest pace since June

(5.51 million), but still remain 0.9 percent below a year ago.

Lawrence Yun, NAR chief economist, says sales activity in October picked up for the second straight month, with

increases in all four major regions. "Job growth in most of the country continues to carry on at a robust level and is starting to slowly push up wages, which is in turn giving households added assurance that now is a good time to buy a

home," he said.

"While the housing market gained a little more momentum last month, sales are still below year ago levels because low inventory is limiting choices for prospective buyers and keeping price growth elevated."

Added Yun, "The residual effects on sales from Hurricanes Harvey and Irma are still seen in parts of Texas and Florida. However, sales should completely bounce back to their pre-storm levels by the end of the year, as demand for buying

in these areas was very strong before the storms."

The median existing-home price for all housing types in October was $247,000, up 5.5 percent from October 2016 ($234,100). October's price increase marks the 68th straight month of year-over-year gains.

Total housing inventory at the end of October decreased 3.2 percent to 1.80 million existing homes available for sale, and is now 10.4 percent lower than a year ago (2.01 million) and has fallen year-over-year for 29 consecutive months.

Unsold inventory is at a 3.9-month supply at the current sales pace, which is down from 4.4 months a year ago.

Properties typically stayed on the market for 34 days in October, which is unchanged from last month and down from

41 days a year ago. Forty-seven percent of homes sold in October were on the market for less than a month.

Realtor.com's Market Hotness Index, measuring time on the market data and listings views per property, revealed that the hottest metro areas in October were San Jose-Sunnyvale-Santa Clara, Calif.; Vallejo-Fairfield, Calif.; San Francisco-

Oakland-Hayward, Calif.; San Diego-Carlsbad, Calif.; and Boston-Cambridge-Newton, Mass.

"Listings - especially those in the affordable price range - continue to go under contract typically a week faster than a

year ago, and even quicker in many areas where healthy job markets are driving sustained demand for buying," said

Yun. "With the seasonal decline in inventory beginning to occur in most markets, prospective buyers will likely continue to see competitive conditions through the winter."

According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 3.90 percent in October (matches highest rate since June) from 3.81 percent in September. The average commitment rate

for all of 2016 was 3.65 percent.

First-time buyers were 32 percent of sales in October, which is up from 29 percent in September but down from 33

percent a year ago. NAR's 2017 Profile of Home Buyers and Sellers released last month - revealed that the annual share

of first-time buyers was 34 percent.

NAR President Elizabeth Mendenhall says the pending tax reform legislation in both the House and Senate is a direct

attack on homeowners and homeownership, with the result being a tax increase on millions of middle-class homeowners in both large and small communities throughout the U.S.

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"Making changes to the mortgage interest deduction, eliminating or capping the deduction for state and local taxes and

modifying the rules on capital gains exemptions poses serious harm to millions of homeowners and future buyers," said Mendenhall. "With first-time buyers struggling to reach the market, Congress should not be creating disincentives to

buy and sell a home. Furthermore, adding $1.5 trillion to the national debt will raise future borrowing costs for our children and grandchildren."

All-cash sales were 20 percent of transactions in October, unchanged from September and down from 22 percent a

year ago. Individual investors, who account for many cash sales, purchased 13 percent of homes in October, down from 15 percent last month and unchanged from a year ago.

Distressed sales - foreclosures and short sales - were 4 percent of sales in October, unchanged from last month and down from 5 percent year ago. Three percent of October sales were foreclosures and 1 percent were short sales.

Single-family and Condo/Co-op Sales

Single-family home sales climbed 2.1 percent to a seasonally adjusted annual rate of 4.87 million in October from 4.77

million in September, but are still 1.0 percent under the 4.92 million pace a year ago. The median existing single-family

home price was $248,300 in October, up 5.4 percent from October 2016.

Existing condominium and co-op sales increased 1.7 percent to a seasonally adjusted annual rate of 610,000 units in

October (unchanged from a year ago). The median existing condo price was $236,800 in October, which is 6.9 percent above a year ago.

Source: World Property Journal

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DEFINING LANDSCAPES SINCE 1985 Page 54

ASSET MANAGEMENT SALES LEASING

VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION

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, 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.