Qatar’s national carrier, Qatar Airways has reached to an agreement with Barwa Real Estate Company to rent the entire Barwa City, says reports.
The agreement between the two parties worth QR 7.1 billion, reached recently reported the Al Sharq newspaper.
Barwa City has 128 building complexes comprising of 6,000 units that can accommodate 25,000 people. While, the Qatar Airways employees are being provided accommodation in different places and through this deal many residential buildings are likely to be vacant in the city.
Delivery of the units will be by September next year. However, specifics were not given as to how long the rent duration will be. Sources close to the deal say it might be for 5 years with the possibility of renewal after the contract expires. This agreement between the Qatar Airways and Barwa Real Estate Company is the biggest deal in the real estate rental market to date.
The impact of the World Cup bid on Qatari commercial property was the key topic at CoreNet Global’s Middle East Chapter networking event held last week. The event, which took place at the Galleries in Downtown Jebel Ali, intended to highlight the current drivers in the commercial real estate market and look at the impact of the World Cup on Qatar. A report was presented which summarised the implications of the evolving commercial market for occupiers and their employees in Qatar. Mark Proudley, Associate Director, DTZ, who compiled the report and hosted the presentation, said: “In the medium to long term we consider demand for real estate in Qatar will remain strong on the back of high levels of domestic investment by the government, triggered by the successful bid to host the FIFA 2022 World Cup; however the construction programmes proposed, also part of the World Cup bid, should ensure that future supply meets these increases in demand. “In addition to pricing landlords will need to start taking tenant requirements into greater consideration and require them to implement proactive asset/facilities management strategies to attract and retain tenants.”
Hydrocarbons will continue to dominate national prosperity but, with the completion of the last of the major hydrocarbons projects in 2012, the emphasis of Qatar’s National Development Strategy (NDS) is emphasizing developing the non-hydrocarbon sector. In a report composed by Samba Financial Group, they project that real GDP growth will exceed 20 percent this year before slipping to 6 percent next and – in line with the NDS – hold at around 4-5 percent a year post-2012 as the non-hydrocarbon sector takes over as the engine of growth. This will be supported by the massive $226 billion planned investment program, including $95 billion from the central government. A number of major real estate projects such as the Pearl, Lusail, and Musheireb Properties (formerly Doha Land) are still moving ahead to accommodate the future growth of the local market. We’ve found that there continues to be an increase in interest in “lifestyle” property projects such as the aforementioned, with more and more tenants and buyers flocking to areas such as the Pearl
Ezdan Real Estate ranked first in Qatar in terms of market capitalization among 37 Qatari companies in the top 500 Arab companies in terms of market capital for the year 2009-2010, according to the list published by “Economic and Business” Special Economic Magazine, the Magazine indicated that the market capitalization of Ezdan Real Estate Company has reached around 22 Billion 225 million and 590 thousand USD till the end of 2010, And among the arab companies Ezdan rise thunderously to 6th rank after it was at 18th position in 2009, where it recorded growth in its market capitalization 168.7%. The “Economic and Business” magazine noted the Excellency gained by Qatari companies among top 500 Arab companies listed in Arab Exchange in 2010, where it achieved the highest growth rate in market capital by 43.5%, to get rank the second directly after Saudi after it was at third position in 2009, Indicating that the remarkable growth in market capital of Ezdan reaching 168.7%, and continued decline in market capital of Saudi Arabia and Emirates real estate companies, led to increase Ezdan’s position in Arab real estate sector from 17.5% in 2009, to 39% in 2010, pointing out that this jump that Ezdan has achieved reflected clearly on increasing real estate companies’ market capital in Qatar which grew by 147.5% in 2010, along with new real estate companies were not in 2009, and that was Barwa. Ezdan Real Estate ranked first among the Arab companies which achieved highest growth rate in its market capital value that reached 168.7% in 2010, and ranked fourth among top capitalized companies according to international market capital reaching 22bn and 225 million and $590 thousand, while SABIC manage to get first position with market capital of 83bn and $800 million with growth rate of 27 percent in 2010 in comparison with 2009, and Emirates Telecommunication Corporation got the second position with market capital of 23bn and 266 million and $30 thousand, followed by “Zain” mobile telecommunication company which ranked third among top capitalized companies according to international market capital amounting to 23bn and 208 million and $120 thousand with growth rate of 49% in 2010 compared to last year. According to “Economic and Business” magazine shows that Ezdan managed to get first position in Arab real sector in a list of 15 real estate companies, Qatar industries ranked first in Arab industry sector, Qatar Gas Transport company “NAQELAT” occupied first position in transport services and facilities sector, Qatar Insurance company ranked the first in Arab insurance sector, and “Aamal” company occupied first position in services sector. It is noted that Ezdan Real Estate company has achieved 6 percent increase in its assets in 2010 , to reach 31bn and 924 million QR (around 8bn and $346 thousand ), compared to 30bn and 60 million QR(around 8bn and $236) in the end of the year 2009, reflecting the growth in the value of real estate investments of company. While the total equity reached 27bn and 402.847 million QR (around 7bn and $507 million) for the last year ended in 2010, compared with the amount of 27bn and 284.556 million QR ( around 7bn and $475 million) in 2009.
Qatar has drawn up an ambitious industrial map to encourage manufacturing activities which are the key to its crucial economic diversification drive, and hopes to spend a whopping QR30bn on the historic initiative.
This was disclosed by the Minister of Energy and Industry, H E Dr Mohamed Saleh Al Sada, here on Tuesday. He was answering questions at the Prime Minister’s interface with businessmen.
“Only last week we have launched an industrial map and plan to spend QR30bn on the initiative,” said Al Sada, urging the private sector’s cooperation in making the plan a success.
Raw materials like gas and electricity are cheaper here, so manufacturing activities can be quite viable. “We are also offering lucrative tax exemptions for industries,” said the Minister.
Replying to questions, the Minister of Finance and Economy, H E Yousuf Hussein Kamal said all the industrial areas underway in the country will be ready in two-and-a-half years.
Land will then be allocated to businessmen, he said, adding that he hoped that the Mesaieed port will be ready by 2015 and the upcoming New Doha Port will be commissioned by 2012-13.
Announcing sops for the private sector which he earlier blamed for the price rise, the Prime Minister and Foreign Minister H E Sheikh Hamad bin Jassem bin Jabor Al Thani (pictured), said at least 30 percent of public projects to be launched over the next five years will be awarded to the private sector. But he asked businessmen to be ready to face foreign competition since Qatar is opening up its economy.
Being a member of the World Trade Organization (WTO), Qatar is committed to implementing GATT (General Agreement on Tariffs and Trade) and set up a free market economy, the government made it clear on Tuesday.
“We would be awarding at least 30 percent of the contracts for public projects over the next five years to you, but be ready to face foreign competition,” the Prime Minister told businessmen.
Replying to questions, the PM said in the context of private-public partnership (PPP) that some services at the upcoming New Doha International Airport would be privatised.
The private sector was welcome to invest in the ambitious railway projects as well, the PM said, but hinted that he was not quite optimistic about the project.
Food security is presently the top priority of the government and the private sector can play an active role in making projects related to food security a success.
“We used to import roses from Holland, for instance, but now (state-backed) Hassad Food Company is growing roses,” the Premier said asking businessmen to launch such projects.
The PM denied that the state was backing public sector companies like Qatari Diar, Barwa Real Estate Company and Karwa (Mowasalat) and said that since Karwa was providing key public transport services it was suffering losses.
And as for Barwa, it was set up in 2007 amid the world financial crisis and its primary objective was to help reduce skyrocketing rents.
It was only after Barwa came on the scene that villa rents that were ruling at QR25,000 at the time, came crashing down to QR15,000, for instance, said the Premier.
Qatari Diar is making investments overseas so there is no question of state entities competing with the private sector. The state entities are providing key public services, said the PM.
The Minister of Business and Trade, H E Sheikh Jassim bin Abdulaziz, in response to a question from the audience, said work on the three proposed free economic zones had begun and rules will soon be announced.
Qatar property transactions continued to rise last week, as more investors and holiday homebuyers aim to take advantage of anticipated future capital growth.
The Qatar News Agency (QNA) reports that Qatar property sales shot up by 65 per cent last week compared to the previous week, with a wide range of homes sold across various municipalities, including Umm Salal, Doha, Al Wakra, Al Khor, Al Rayyan, Al Dain and Al Shimal.
The Middle East emirate of Qatar might not seem an obvious choice for a second home, but the country has gained greater exposure since being awarded the rights to host the 2022 football World Cup.
The football tournament is bound to have an impact on the housing market. In fact, shrewd property investors have wasted no time turning their attentions to the tiny Gulf state, with a population of 1.6 million.
Khalifa Al-Misnad of Qatar property firm Coreo reports that property inquiries from overseas buyers, particularly the British, have been considerably higher since the winning bid, as investors seek to benefit from any capital growth that the World Cup may help generate.
Tens of billions of pounds will be spent on mass infrastructure improvements, including football stadiums, transport links, roads and man-made beaches.
Qatar has followed Dubai’s example in offering ownership of property to foreigners in select areas in Qatar. Many areas have been opened up to property leases by non-GCC nationals, on a 99-year renewable basis. Non-GCC nationals who lease can use the properties commercially or for their own benefit, transfer the lease to another party, sublet or rent. Many projects offer a 99-year lease, coupled with residency rights for non-GCC citizens.
As Qatar moves its economic dependence away from oil and gas the government have begun creating openings and introduced incentives that have attracted many international businesses to the country. This has had significant affect on the local economy and has created an environment of growth and prosperity long-term. Many overseas professionals who have relocated to the region have significant purchasing power and have demanded the ability the ability to purchase property for investment or ownership in Qatar.
The Qatar constitution has altered to allow foreign ownership and hence the creation of a viable and competitive property sector in Qatar. Property being built is on par with that being constructed in Dubai. High spec and high rise are the main features and as mentioned the majority of buyers and renters of these properties are expatriate professionals.
While nothing in investing is certain many international property investors see Qatar offering at least as much potential as Dubai and as supply is not as ready available as other UAE regions Qatar may well be a solid prospect on many levels.
Taking its place on the worlds stage. Qatar is an independent Arab state, embracing the future with unswerving optimism and enviable potenital. A member of the GCC, PEC, The United Nations, The International Monetary Fund, The International Bank for Reconstruction & Development and the World Trade Organization, Qatar has achieved within decades what other countries take centuries to accomplish. Situated at the heart of the Arabian Gulf, Qatar is in close proximity to Saudia Arabia, Bahrain, United Arab Emirates and Iran. Almost completely surrounded by Sea, Qatar is a fascinating, well preserved, natural and historical site, hence an ideal family location and a very safe place to visit, live and work and purchase a Qatar Property
Qatar’s economic performance remains strong, despite the global crisis. The country is the world’s biggest exporter of liquefied natural gas (LNG). It has also more than 15% of the world’s proven gas reserves. Qatar has the third highest GDP per capita in the world, at QAR286,666 (US$78,754). Its wealth has grown at breakneck speed during the past 15 years, particularly since the Iraq War.
The country’s economy grew by an average of 16% from 2006 to 2008. Then in 2009, real GDP growth rate slowed to 11%. In 2010, the economy is projected to grow by 16%. However, the positive outlook for the economy was not reflected into the property market which remained depressed due to the oversupply of high-end properties.
The robust economy is the main driver of the property boom in Qatar in the past few years. The surge in demand for housing units fuelled by the influx of expats and higher purchasing power of Qataris has triggered property prices to climb in the past years. However, starting mid-2008, house prices and rents dropped sharply due to the global crisis.
In 2009, the country is expected to book deflation of about 3.5%. Qatar experienced escalating prices in the past years, with an average annual inflation rate of 13.5% from 2006 to 2008. In 2010, inflation rate is projected at 4%.
Unemployment was 0.3% in 2009. The unemployment rate among the economically active population was 0.3% in 2009, but higher at 2.3%
Real estate transactions between May 29 and June 2 for the real estate sales contracts registered at the Ministry of justice are worth QR1,106,084,473, the real estate registration department at the Ministry said in its weekly report.
The list of propertiesthat were traded either by sale or mortgage includes open plots of land, two floors villas, annex, houses, residential compounds, towers and shops which are located in the municipalities of Umm Salal, Doha, Al Khor, Al Rayyan, Al Shamal, Al Daayen and Al Wakra.
real estate sector in Qatar has succeeded in attracting foreign investments. While majority of this was from the wealthy investors in other GCC countries, there have also been investments by funds investing in GCC real estate, though at a relatively smaller scale.
In the case of Pearl project, one of the prominent large scale developments in the country, Qataris account for approximately 10% of all the customers, while the remaining 90% include customers from Saudi Arabia, Kuwait, Egypt, Turkey, Morocco and Iran. The scenario for foreign investments could further improve in course of time with the increasingly relaxed regulatory restrictions.
Looking forward, the real estate boom in Qatar is not expected to end. This is mainly due to
the increased development projects for the medium as well as the long term. Lots of mega
projects are either under development or under planning are expected to guide the sector for
the following years.
According to data from Zawya, four mega projects are estimated to add up to US$10.1bn or even higher. Moreover, recent estimates from industry sources suggest that US$120bn worth of investments will be channeled into Qatar over the next five years for infrastructure improvement.
We expect such projects to have their impact not only on the real estate sector but to have its effect on the Qatari economy as a whole through multiplier effects.
Such projects are expected to impact construction material prices, increase labor demand especially for construction thus, creating new job opportunities.
Generally, infrastructure projects have been allocated a total of US$13bn with US$5.5bn for the new airport, US$1.8bn for the Qatar-Bahrain causeway, US$3.8bn for a five year program of public works that ends by 2009 and US$3bn for electricity and water projects.
According to the Ministry of Finance; Qatar’s economy will be over and above US$60bn by 2011 as the state enjoys one of the fastest expansion plans in the world.
mannzili 