news brief 1 - asteco property management...a heavy recruitment drive in the first half of 2015,...

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IN THE MIDDLE EAST FOR 30 YEARS

ASSET MANAGEMENT SALES LEASING

VALUATION & ADVISORY SALES MANAGEMENT OWNER ASSOCIATION

RESEARCH DEPARTMENT

NEWS BRIEF 31SUNDAY 09 August 2015





REAL ESTATE NEWS DUBAI

'SLIGHT' DECLINE IN HIRING IN DUBAI'S REAL ESTATE SECTOR MEYDAN LAUNCHES HUGE DUBAI PROJECT WITH WORLD’S TALLEST

RESIDENTIAL TOWER RENTS FALL ACROSS POPULAR LOCATIONS IN DUBAI

DUBAI MEYDAN ONE PROJECT’S RECORD BREAKERS EMIRATES REIT TO SPEND DH208M ON NEW SCHOOL AT AKOYA BY DAMAC

MAJID AL FUTTAIM POSTS FLAT EARNINGS ON HIGHER COSTS AND LOWER HOTELS PROFIT

PROPERTY STOCKS MAKE DFM REGION’S BEST-PERFORMING BOURSE PROFIT RISES 52% FOR DUBAI’S DAMAC PROPERTIES

BACK-WEIGHTED DUBAI PROPERTY PLANS SOAR IN POPULARITY AMONG INVESTORS

AFFORDABLE DUBAI: WHERE RENTALS SOFTENED DUBAI POLICE INVESTIGATE VANDALISM AT PROPERTY FIRM FOLLOWING

CLOSURE DUBAI PROPERTY MARKET RECEIVES 6,750 NEW HOMES UNION PROPERTIES STARTS WORK ON GREEN COMMUNITY PHASE THREE

IN DUBAI INDIANS, BRITS, PAKISTANIS TOP EXPAT INVESTORS IN DUBAI PROPERTY

DUBAI TO DELIVER NEW WAVE OF AFFORDABLE HOUSING OPTIONS DUBAI PROPERTY TRANSACTIONS TUMBLE 69 PERCENT

LANDMARK ZENATH TO OPEN HUNDREDS OF MID-MARKET ROOMS IN DUBAI THIS YEAR

DH52M COMPENSATION FOR LAND OWNERS IN AL NAKHEEL AREA EMAAR SAID TO PLAN 2017 START TO GOLF DISTRICT PROJECT IN DUBAI

ABU DHABI

QUARTERLY PROFIT RISES 18% FOR ABU DHABI’S ALDAR PROPERTIES ABU DHABI HOTEL OCCUPANCY RATE GOES DOWN DURING RAMADAN

OTHERS

QATAR TO REMAIN GCC’S STRONGEST CONSTRUCTION MARKET

REGARDLESS OF WORLD CUP FATE





'SLIGHT' DECLINE IN HIRING IN

DUBAI'S REAL ESTATE SECTOR

THURSDAY 06 AUGUST 2015

Hiring in the UAE's real estate industry has slowed down a bit, as a number of small-time companies are

trying to cope with a drop in business activity, a source told Gulf News.

Dubai's property market edged "further south" during the second quarter of the year, with rental rates

in a number of locations and homes for sale recording a decline, according to an earlier report by

property consultant Asteco.

The "softening" in the market has had an impact on some businesses, including real estate agencies. In

fact, one leading real estate organisation in Dubai has recently closed shop, causing about 80 employees

to lose jobs.

Recruitment specialists, however, insist that the overall employment scenario is still good, adding that

while there have been some job cuts in the sector, some developers are still hiring additional staff as

they launch new projects.

"Our annual research doesn't reflect any significant job cuts in the sector as a whole. On the contrary,

we have seen the large real estate companies increasing overall number of employees as new

developments and projects are announced," Harish Bhatia, regional manager, UAE at Hay Group, told

Gulf News.

There are also no reports of companies cutting back on employees' salaries. ""We're also not seeing any

reactions in terms of compensation levels in this sector. Other than a slight slowdown in hiring due to a

focus on cost management, it is business as usual for most developers."

"Some smaller players and real estate agencies may be impacted due to reduced activity in their areas

of specialty, however, this comprises a minimal impact in terms of the sector overall," Bhatia pointed

out.

S&K Estate Agents, also known as Smith and Ken, filed bankruptcy in July, causing more than 80

employees to lose their jobs. The company's Dubai and LA offices are no longer active after the

company filed bankruptcy on July 21.

"Unfortunately, we have had no other choice but to file bankruptcy and hand over accounts and any

remaining income to our liquidator," the company said in a statement.

"Simply put, the revenue being generated by the business drastically reduced over the first half of 2015,

without enough income to cover operational costs."

"Additional support, advertising, incentives and training had been provided to existing and new agents

to try and aid their growth and development to increase sales."

"As a last resort to find more experienced agents, the shareholders invested a considerable amount into

a heavy recruitment drive in the first half of 2015, using recruitment agencies in both Dubai and the UK.

However, the fruits of this process did not transpire in time to save the organization."

Bhatia said that bigger real estate companies in Dubai have recruited 4 per cent to 7 per cent new staff

in the last 12 to 18 months.





"The roles in demand depend very much on the individual company and what area they're focusing their

growth on. Some that have launched new projects have recruited new sales executives, some have

diversified and increased capacity in facilities management or leasing for example," said Bhatia.

"It's not yet clear how much recruitment we'll see in the coming 12 months, but so far, there are no

plans for reductions."

Source: Gulf News

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MEYDAN LAUNCHES HUGE DUBAI

PROJECT WITH WORLD’S TALLEST

RESIDENTIAL TOWER

TUESDAY 04 AUGUST 2015

The developer Meydan has announced the launch of a new scheme known as Meydan One featuring a

711m-high tower, a huge new mall, the world’s largest indoor ski slope, a 25,000 sq metres indoor

sports facility, the biggest dancing fountains in the world, a beach and a civic plaza capable of hosting

up to 60,000 people. It is also to contain a 100-berth marina.

And, a retractable roof.

“In a city which never stops innovating, today’s announcement is significant for the future of Dubai and

the UAE,” said the Meydan chairman Saeed Al Tayer.

The development has already been approved by Sheikh Mohammed bin Rashid, Vice President and Ruler

of Dubai. It was launched on Monday night at Meydan hotel.

The details are impressive.

The project is to have a total built up area of 5 million sq metres and be home to 78,300 residents. It is

to contain a 5-star hotel with 350 keys, a conference centre, the world’s highest 360-degree observation

deck (at 655m), the world’s highest sky restaurant at 675m, 885 apartments and a marina yacht club.

The mall is to have a 150m by 80m retractable roof that opens in the cooler winter months. It will be

home to around 300 restaurants, cafes and kiosks as well as a range of retail outlets and nightlife

venues. The ski slope is to be 1.2km long and at its base would be the Meydan Arena – an 8,000-

capacity venue to host sporting events, concerts and shows.

Outdoor space surrounding the arena is to contain football pitches, mountain biking, walking and

running trails and a BMX park, while the 25,000 sq metres arena is to house an array of indoor sports.

The dancing fountains are to be more than 420m long, the beach 300m and there is to be a 9km-long

boardwalk. A heritage village is also part of the plan.

The first phase of the project, located between Meydan and Al Khail Road, is scheduled for completion

before 2020. It is toinclude the tower, the mall, the civic plaza, the dancing water feature, a 4km canal

and the marina.

Mr Al Tayer said: “We have committed to developing a multi-use destination which goes beyond

expectations and will cater to every kind of person living and working here, as well as those who travel

from around the world to visit.

“This development is a forward thinking, interactive enterprise geared towards the Dubai of tomorrow.

The encouragement and support we have received in the past from our trusted partners will now help

the Meydan One development come to life.”

Meydan will unveil more information about the project at this year’s Cityscape exhibition, which is taking

place at the Dubai World Trade Centre from September 5 to 7.





Dubai currently has 2.9 million sq metres of retail space but a further 194,000 sq metres is due to be

added this year and an extra 419,000 sq metres next year as extensions to existing super-regional malls

– namely Mall of the Emirates and The Dubai Mall - complete. Dubai Holdings has also announced plans

for a 750,000 million sq metres mall as part of its Mall of the World project – the first phase of which is

also due to be delivered by 2020.

Speaking about current market conditions, Craig Plumb, the head of research for the property

consultancy JLL Mena, said: “Retail sales, particularly in the luxury segment, have slowed, driven

primarily by the decline in tourist numbers from Russia, while the current level of market saturation in

the food and beverage segment is expected to put pressure on retailers to differentiate their offerings in

the face of strong competition.”

Source: The National

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RENTS FALL ACROSS POPULAR

LOCATIONS IN DUBAI


Most locations in Dubai saw residential rents edged further south in the second quarter, with some

sought-after communities posting noticeable reductions of nearly 7 per cent, as new developments

spring up.

Researchers at a property portal have tracked the price movements in popular communities in Dubai

and found that Jumeirah Lakes Towers (JLT), Business Bay, Downtown Dubai and Dubai Marina now

offer more affordable choices. Depending on the size of the property, rents in these major locations

have dropped between 0.21 per cent and 6.04 per cent, according to Bayut.com.

The good news for UAE residents with huge families is that they can find cheaper spaces to rent in JLT,

where three-bedroom apartments posted the biggest decline at 6.3 per cent, from Dh195,175 in the first

quarter to Dh182,702 in June. One-bedroom flats in the same area have also declined by 3.99 per cent.

The declines have been attributed to the shift of tenants to newer buildings or spaces that offer more

square footage for a similar price. "Landlords of vacant properties have refrained from jacking up rents

in order to ensure occupation and thus the data shows declines in the one- and three-bedroom

categories," said Haider Ali Khan, the company's CEO.

However, JLT is not highly recommended for those looking for smaller spaces, as studios and two-

bedroom properties have become more expensive, up by 3.51 per cent and 1.19 per cent, respectively.

Khan said that JLT is becoming increasingly popular among the upper or middle-income residents of

Dubai, causing a couple of categories to post some increases. "JLT is generally a residence of choice for

the upper-middle class of Dubai."

Another highly sought-after location due to its luxury properties and proximity to Dubai Mall, Shaikh

Zayed and Dubai International Financial Centre (DIFC), Downtown Dubai posted the second biggest

decline of 6.04 per cent for two-bedroom flats, which are now more than Dh10,000 cheaper, from

Dh220,790 to Dh207,445. Three-bedroom apartments in the area, which are still higher compared to

other communities, have dropped by 5.68 per cent, from Dh326,230 to Dh307,706.

A collection of properties in Business Bay, such as three-bedroom and one-bedroom flats, have

increased marginally by 1.28 per cent and 1.05 per cent respectively, but studio apartments have

registered a noticeable price reduction of 3.2 per cent, while two-bedroom flats dropped by 0.62 per

cent, making the area ideal for singles or those who are on the hunt for small to medium-size

apartments.

Business Bay is also gaining popularity due to the development of the Dubai Canal and several other

residential and commercial buildings. "The master developers went further to develop family parks to

facilitate the flow of families into the area," Khan said.

Noted for its "high-end lifestyle and unique charm", Dubai Marina also offers affordable choices,

especially for those who are looking for really big apartments. Three-bedroom flats in the area dropped

by 1.47 per cent, from Dh232,696 to Dh229,277, which are also cheaper than those in Downtown

Dubai.





All the other categories, however, posted some increases, with studio apartments going up by .21 per

cent, one-bedroom by 0.63 per cent and two-bedroom by 1.83 per cent. Obviously, this side of town is

gaining much interest from residents looking to rent small to medium-size properties.

"Offering yacht docking areas and the man-made marina at the foot of the Palm Jumeirah while being

located along Shaikh Zayed Road are the main ingredients that make it the most popular locality among

tenants."

Just next to Dubai Marina, Jumeirah Beach Residence (JBR) apartments have also registered price

declines of 7 per cent, as well as Shaikh Zayed Road (7 per cent) and Palm Jumeirah (6 per cent),

according to Asteco.

"We even saw a 6 per cent decline for Palm Jumeirah, with the handover of the lower specification

Palma Residences' townhouses impacting rental rates due to their lower price brand," said John Stevens,

managing director, Asteco.

According to Asteco, rents in the villa segment, dipped by 7 per cent quarter-on-quarter and 15 per cent

year-on-year, thanks to the handover of projects like Casa Villas at Arabian Ranches.

The handover of three and four-bedroom townhouses at the Mudon community, which offers competitive

pricing at Dh175,000 per year, has put pressure on landlords of neighbouring areas to secure and retain

existing tenants.

Source: Gulf News

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DUBAI MEYDAN ONE PROJECT’S

RECORD BREAKERS

MONDAY 03 AUGUST 2015

The Meydan One project in Dubai, unveiled this evening, is big in every respect. So big in fact the

developer envisages it breaking not just one record, but five when the project is scheduled for

completion before 2020.

The record breakers are:

■ The world’s longest indoor ski slope at 1.2 kilometres. The current record is at AlpinCenter in

Bottrop/Germany at 640 metres.

■ the largest dancing fountain reaching over 420m long. The Dubai Fountain currently holds the record

at 275m long.

■ The world’s tallest residential tower. The World One in India, currently on construction, is expected to

reach 442m and become the world’s tallest residential tower when completed in 2016.

■ The world’s highest 360-degree observation deck at 655m. Burj Khalifa’s At The Top Sky currently

holds the record at 555m above the ground.

■ A sky restaurant at 675m high, which is a world record.

■ A few other numbers to come from the launch:

■ a 25,000 sq m indoor sports facility

■ a 100-berth marina

■ home to 78,300 residents

■ an 8,000-capacity venue that will host sporting events and concerts

■ a 300m beach.


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EMIRATES REIT TO SPEND DH208M ON

NEW SCHOOL AT AKOYA BY DAMAC

MONDAY 03 AUGUST 2015

Emirates Reit is investing Dh208.3 million to develop an education complex at the Akoya by Damac

development in Dubai.

The company has bought a freehold plot on the site, off Umm Suqeim Road, from Damac Crescent

Properties for Dh98.5m. It will spend a further Dh109.8m to develop the 20,800 square metre complex.

It has been leased to Jebel Ali School, which has signed a 26-year tenancy agreement.

Upon its completion, the development will account for 9.2 per cent of Emirates Reit’s Dh2.25 billion

portfolio, and the lease will generate an internal rate of return of 11 per cent on its investment.

The development will house primary and secondary schools, a sports centre and an auditorium. It will

draw pupils from Akoya by Damac and nearby residential developments such as Arabian Ranches, Motor

City, Sports City, and the Green Community.

Emirates Reit’s latest investment is the second education development in its portfolio, following a sale-

and-leaseback deal with education provider Gems in November 2013 for its World Academy building in

the Al Barsha South area.

The rationale for the deal is “quite easy”, according to Sylvain Vieujot, Emirate Reit’s executive deputy

chairman.

“Our main goal is to develop a good portfolio of properties and distribute dividends to our investors.

Schools provide us with an opportunity to do this.

“We think education is a safe business, as they are not going to go broke.”

The education business offers a way to fund expansion without having to tie up lots of funding, said Mr

Vieujot.

All education providers have to build their own schools but have to use a lot of capital to do so, he said.

That acts as a brake on growth because schools have to find more money to recruit staff and spend on

marketing to attract students.

“If we provide that capital, we are helping to develop your business, which is to be an education

provider, so it works for both,” said Mr Vieujot.

The plot on the Akoya by Damac site – the first of only two potential school sites on the master plan –

was “a unique opportunity in an exciting and upcoming area of the city”, he said.

Over the next four years, an extra 52 schools are expected to be needed to meet demand, according to

Dubai’s Knowledge and Human Development Authority.

At Index Tower, Emirates Reit recently said it had completed the fit-out and furnishing of a second office

floor at the building, which has been pre-leased.

The floor houses 22 office units that range between 48 square metres to 79 square metres in size.

Three further floors are being fitted out and will be ready for leasing by the fourth quarter.





For the first half of the year, Emirates Reit delivered an annualised total return of 16.39 per cent to

investors, and its net asset value stood at $1.5 a share.

The company has eight buildings in its portfolio with about 176,000 square metres of space, of which 71

per cent is occupied.


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QUARTERLY PROFIT RISES 18% FOR

ABU DHABI’S ALDAR PROPERTIES


Aldar Properties yesterday reported an 18 per cent annual increase in net profit for the second quarter.

The company attributed the rise to higher recurring revenues from its retained portfolio, as well as

higher development margins and lower finance costs.

The Abu Dhabi-listed developer made a net profit of Dh601 million, compared with Dh509m in the same

period last year. This is despite revenue halving in the period to Dh1.1 billion from Dh2.2bn in the

second quarter of last year as fewer completed properties were handed over. Profit for the six months to

June 30 increased by 21 per cent to Dh1.2bn, although revenue was 42 per cent lower at Dh2.3bn.

Aldar’s chief financial officer Greg Fewer said that the 2014 revenue figure was much higher because it

handed over 3,500 units to customers during that period – mainly at The Gate Towers at Shams Abu

Dhabi and the Al Rayanna development near Abu Dhabi Golf Club.

“We recognised 100 per cent of the profit for those at the end of the second quarter of 2014 and in the

adjacent quarters,” said Mr Fewer. “We’re in a different cycle now and a different accounting regime.”

The company recently adopted the IFRS 15 accounting standard. This allows it to recognise revenue

from customers who purchase an off-plan property over the lifespan of its construction as opposed to a

lump sum once clients take possession.

The company said that gross profit margins were up 60 per cent as a result of growth in recurring

revenues, driven by the leasing of more than 3,000 units at Gate Towers and Al Rayana and income

from Yas Mall, which opened last November.

Of the 4,800 residential units it has in its leasing portfolio, 98 per cent were occupied at the end of June.

Of its 184,000 square metre office portfolio, 91 per cent had also been taken up.

Aldar said it had generated Dh1.2bn in cash from the sale of land plots and from government income,

which has helped it to cut a further Dh1.1bn off a debt pile that now stands at Dh7.1bn – down from

Dh13.7bn 18 months ago.

Mr Fewer said that Aldar is “very, very comfortable with our debt levels”. He added: “We have scheduled

amortizations due in the fall and in December, but I wouldn’t expect any large-scale movements.”

During the first six months of the year, Aldar achieved new sales of Dh1.9bn – Dh1bn of which came

from land plots at its Nareel Island project. Two main construction contracts were awarded for the

Anseem and Hadeel projects, but Aldar did not say which contractors had been appointed.

Harshjit Oza, the assistant director of research at Naeem Brokerage, said that Aldar’s results were ahead

of expectations. He said that the firm’s profitability had been boosted by land sales and Government

payments – it was paid Dh2.5bn of money owed to it by the Government during the first half of this

year.

“In terms of the market, all of the GCC countries are facing challenges due to the commercial

environment caused by the decline in oil prices, but we haven’t seen that in the results of real estate

companies. This shows that there is still genuine demand.”






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AFFORDABLE DUBAI: WHERE RENTALS

SOFTENED

TUESDAY 28 JULY 2015

Residential rents and property prices in Dubai became more affordable with real estate consultancies

reporting drop in rents and purchase rates in the second quarter of 2015.

According to a report by Abu Dhabi Islamic Bank (Adib) on Dubai’s real estate sector, rents in Dubai

dropped three per cent on supply of new units in the second quarter of this year, underscoring two

earlier reports released this month about decline in rental rates.

A majority of the new 6,750 residential units came up along the Sheikh Mohammed bin Zayed Road

(MBZR) with International Media Production Zone (IMPZ) area accounting for 26 per cent of the total

supply.

Real estate consultancy Asteco said in its Q2 2015 report that apartment and villa rents across Dubai fell

by an average 2 per cent in 2015.

Another real estate consultancy CBRE said rental market recorded marginal deflation in rates during Q2,

posting the first quarterly drop since 2011.

Rentals within the villa market saw the steepest decline, falling by an average of three per cent as

compared to a two per cent dip in apartment rentals, CBRE said.

Adib report maintains the new supply of 6,750 units took the total number of residential units in Dubai

to 479,000 by the end of the second quarter of this year.

Biggest fall was in Business Bay property prices, said the Abu Dhabi-based bank’s report. Buying

property in Business Bay became cheaper, recording a five per cent drop in value.

Capital values for completed apartment units fell 3.5 per cent quarter-on-quarter, with averages sale

prices in Business Bay witnessing the biggest fall of five per cent, it said.

“The volume of new projects in the Dubai market means that properties will increasingly need to appeal

to potential buyers’ sense of value.

“That means a shift towards well managed, self-contained and mid-market properties, particularly close

to the Expo 2020 site,” said Paul Maisfield, CEO of MPM Properties, the real estate advisory subsidiary of

Adib.

“We are also seeing a greater emphasis on buyer incentives and unique selling points, especially in the

luxury segment and expect buyers to benefit from these trends,” he noted.

Source: Emirates 24/7

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MAJID AL FUTTAIM POSTS FLAT

EARNINGS ON HIGHER COSTS AND

LOWER HOTELS PROFIT

WEDNESDAY 05 AUGUST 2015

Majid Al Futtaim (MAF) has reported flat first-half earnings, citing higher costs and weaker hospitality

industry profits.

It said earnings before interest, taxes, depreciation and amortisation remained stable at Dh1.8 billion

despite a 7 per cent rise in revenue to Dh13.7bn from the same period last year.

The result reflects “higher promotional activities, costs associated with new market entries, product mix

impact and a softer market in the hospitality industry”, according to the conglomerate, which operates

malls, retail and leisure businesses.

MAF, which plans to double in size within five years, said property revenue and earnings held steady at

Dh2bn and Dh1.2bn respectively, as the number of mall visitors rose just 2 per cent to 85 million in the

first half. Visitor numbers were affected by expansion work at Mall of the Emirates, which the company

operates.

Occupancy at its hotels was 77 per cent, but revenue per available room, an industry standard, fell 11

per cent.

Retail earnings increased 3 per cent to Dh563 million, weighed by higher costs of new market entries

and new store openings.

“Several large-scale projects are under construction in existing and new markets,” said Alain Bejjani,

MAF’s chief executive.

“Dubai remains the core of our business and we are expanding our presence in Egypt, Saudi Arabia and

Oman, in addition to looking to establish a foothold in Africa and Eurasia.”

MAF has businesses across the Middle East and North Africa and holds the Carrefour hypermarket

franchise for the region.

It is bullish about Egypt, having announced this year its plan to increase its investment in the North

African country to 22.5 billion Egyptian pounds (Dh10.5bn) from 18bn pounds.

The company is set to embark on a mall-building spree in Egypt as it prepares to open Africa’s first

indoor ski slope.


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PROPERTY STOCKS MAKE DFM

REGION’S BEST-PERFORMING BOURSE


Dubai’s index rallied 1.6 per cent yesterday on the back of property stocks, making the Dubai Financial

Market the best-performing bourse in the Middle East.

Damac Properties rose 15 per cent, after reporting a 50 per cent jump in second-quarter net profit

yesterday.

Arabtec followed with gains of 6.6 per cent after it said that phase one of its US$40 billion housing

project in Egypt was still on track.

Amlak, the mortgage lender, surged 14.7 per cent after it said that it planned to launch Islamic

financing for the purchase of off-plan properties in collaboration with the free zone developer Tecom.

Gulf General Investment Company was the Dubai exchange’s biggest decliner yesterday, falling over 2

per cent to 94 fils. Emaar Malls fell 1.8 per cent.

The Abu Dhabi Securities Exchange rose 0.6 per cent, driven by Dana Gasand the Abu Dhabi National

Energy Company. Dana rose 5.5 per cent, while Taqa gained 2.9 per cent.

Methaq Takaful was the biggest loser, declining 9.2 per cent.

The National Marine Dredging Company, which was involved in the construction of the New Suez Canal,

dropped 4.1 per cent, partially reversing its 15 per cent jump on Tuesday.

The MSCI Emerging Markets index gained 0.2 per cent. The Qatar exchange closed up 0.2 per cent,

while the Egyptian Exchange closed down 0.8 per cent.

Brent rose for a second day yesterday. It gained $0.77 in midday trading, or 1.54 per cent, taking oil

back above the psychologically significant $50 per barrel barrier.


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PROFIT RISES 52% FOR DUBAI’S

DAMAC PROPERTIES


Damac Properties reported a net profit of Dh1.4 billion for the second quarter of 2015 on the back of

revenues of Dh2.3bn.

The company said that a comparison to last year’s figures was not possible as it had listed on the Dubai

Financial Market only in January this year.

However, if figures for its former London-listed subsidiary Damac Real Estate Development (Dred) are

used, they equate to a 52 per cent increase in net profit and a 14 per cent rise in revenues.

Damac said it would pay an interim dividend of 10 per cent cash and 10 per cent bonus shares.

During the first six months of the year, it achieved a net profit of Dh2.7bn, 57 per cent higher than the

Dred figure for last year, while turnover was 30 per cent higher at Dh4.7bn.

As well as the change in its parent entity, Damac also adopted the new IFRS 15 accounting standards,

which allow it to recognise revenues from portions of off-plan sales before the buildings are completed.

Mohammad Kamal, research director at the Dubai-based investment bank Arqaam Capital, said the IFRS

15 standards had contributed to the growth reported in these new figures.

“When you sanitise for IFRS, then quarter-on-quarter handovers have slowed down and land sales have

also dropped off a little bit,” he said.

Property sales fell to Dh2.3bn for the second quarter, compared to Dh2.8bn in the first quarter. Despite

this, the firm continues to achieve strong margins, particularly on development properties, he added.

The chief financial officer Adil Taqi said the second-quarter results included much more of the

traditionally quieter Ramadan period than 2014, but that it had since experienced a strong month in July

and a good start to the second half of the year.

He said new sales should hit about Dh10bn for the year, a dip from the Dh11.5bn it achieved last year

when it had an “exceptional” first quarter.

Despite this, he said the company was pleased with its ¬results.

“The market has told us that it likes what it saw,” Mr Taqi said, referring to a 15 per cent increase in its

share price to Dh3.68 by the end of the day.

“We have sold well, we have delivered well and we continue to be optimistic about the future. We are

confident about the prospects for 2015.”


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BACK-WEIGHTED DUBAI PROPERTY

PLANS SOAR IN POPULARITY AMONG

INVESTORS


The number of developers in Dubai offering back-weighted payment plans has risen dramatically in a bid

to tempt more buyers into the marketplace, according to new research.

The report from ReidIn/Unitas, titled The Curious Case of Payment Plans, states that 55 per cent of all

off-plan property launches now offer back-weighted payment terms – up from 29 per cent two years

earlier.

The percentage of schemes where three-quarters or more of the money had to be paid upon completion

has fallen in the first half of 2015 to 50 per cent from 72 per cent in 2013.

Similarly, the schemes where the buyer can defer 50 to 100 per cent of payment until completion have

jumped to 25 per cent from 11 per cent.

Sameer Lakhani, the managing director of the report’s author, Global Capital Partners, says there are

several reasons for developers’ greater generosity, but the strengthening of the US dollar – to which the

UAE dirham is pegged – is the primary one.

He said that since the Dubai government introduced regulations allowing non-UAE citizens to purchase

freehold properties in 2002, the dollar had been in a long bear cycle, which only began to change in

2014. Since then, it has rallied sharply.

“All of the forecasts from various investment banks suggest that it is continuing to get stronger,” he

said. In the past 12 months the dollar has risen over 20 per cent against other major currencies.

He said the Dubai property market has been underpinned by foreign buyers, but that many of these

were now finding property more expensive. Dubai prices have dropped by 8 to 20 per cent from their

peaks in mid-2014, but the rouble’s devaluation means that the price being paid by Russian investors

has effectively increased by 20 per cent.

Developers have two reasons for offering these dramatically more generous payment plans. One is to

entice end-users who are not able to stump up the larger deposits required since the UAE introduced a

mortgage cap in October 2013, which means that expat buyers need to find 30 per cent of a property’s

value up front.

The other is to entice the type of buyers that the cap was introduced to foil – those who used lots of

leverage in a property deal to make a quick profit. The only difference now is that it is developers, as

opposed to the banks, allowing them to do this.

“With off-plan activity, a small percentage of change magnifies the return for investors. So if you have a

10 per cent down payment and the price increases by 10 per cent, you’ve made a return of 100 per cent

on your equity,” Mr Lakhani explained.

“Leverage is a strong word, but there is often interest in it because it lets you juice up your returns.”





Mr Lakhani said private sector developers have been offering the most generous payment plans, with

government-related entities like Nakheel and Emaar Properties relying on their “brand equity”.

However, he added that if the dollar continues to strengthen they too may feel the need to offer more

generous terms to attract overseas buyers.

“We are already starting to see it in the case of Aldar [in Abu Dhabi] and Dubai Properties, and we think

this trend will continue.”

Figures published this week by Dubai Land Department show that of the Dh53 billion invested in the

emirate’s property market during the first half of 2015, Dh17bn came from GCC Arabs, Dh6bn from non-

GCC Arabs and the remaining Dh30bnfrom investors in 120 other nations.


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EMAAR SAID TO PLAN 2017 START TO

GOLF DISTRICT PROJECT IN DUBAI


Emaar will reportedly begin work in 2017 on the Dubai World Central Golf District project, an integrated

urban centre and golf destination.

The Dubai developer is said to have signed an agreement with DWC in December 2013 to build the

project within the world’s first purpose-built aerotropolis, Construction Week Online reported, citing a

source close to the matter.

The rumoured development will occupy an area of 1,360 hectares, with the first phase of the project to

include a golf-course villa community, several hotels, a high-end shopping mall, leisure attractions, and

a business hub that promotes youth entrepreneurship, the report said.

The source told Construction Week: “[DWC Golf District] had not commenced since the signing, but

Emaar is looking to begin its work on the project by 2017.”

DWC is the world’s largest greenfield airport city. At its centre sits Al Maktoum International Airport

(DWC), which once completed, will have the capacity to handle 160 million passengers and 12 million

tonnes of cargo annually.

Construction Week invited Emaar to comment on DWC Golf District, but the developer said that it would

not respond to rumours or market speculation.

Source: Arabian Business

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QATAR TO REMAIN GCC’S STRONGEST

CONSTRUCTION MARKET REGARDLESS

OF WORLD CUP FATE


Qatar’s construction sector will continue to achieve the strongest growth in the GCC regardless of the

fate of the Fifa 2022 World Cup, according to a new report.

BMI Research forecasts the Qatar market will grow at an average rate of 10.2 per cent over the next

decade. It said Qatar’s construction sector recorded year-on-year growth of 11.4 per cent in the first

quarter of the year, which was slower than the “hugely impressive” 18 per cent growth registered in

2014 as a result of the start of a number of major infrastructure projects.

The sector is forecast to grow by 13 per cent this year on the back of further infrastructure work and an

uptick in real estate projects, BMI said.

Although fears over hosting of the World Cup re-emerged following the announcement by Swiss police

that they are investigating the awards of the 2018 and 2022 events to Russia and Qatar, the report

states that although growth might slow if any action were taken, “the majority of major projects would

move forwards”.

“Doha’s metro network is still needed to alleviate congestion, albeit with fewer stations,” the analysts

said. “Doha’s port will still need to be expanded to compete regionally, and Qatar’s future economic

growth will still need expanded power and water capacity.”

BMI added that even if Qatar was stripped of the competition, GDP growth in the country was still likely

to be in excess of 4 per cent per year.

Construction costs have also been identified as another potential issue, with a 2014 report by the

consultancy Arcadis identifying Qatar as the most expensive market in the Middle East.

However, BMI Research highlighted recent moves to alleviate this, including a deal signed last month by

the country’s public works authority, Ashghal, with Qatar Primary Minerals to provide millions of tonnes

of basic building materials including limestone and gabbro aggregates at a fixed price over a five-year

period.

Rachid Mikati, a director of Arabian Construction Company, said Qatar remained a good market for

contractors. His firm has been active in Qatar since the 1970s.

Mr Mikati said that one of the key challenges for contractors was to ensure that they properly price for

the cost of inflation over the lifespan of a project.


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ABU DHABI HOTEL OCCUPANCY RATE

GOES DOWN DURING RAMADAN

SUNDAY 26 JULY 2015

Hotels in the capital reported a muted performance last month because of Ramadan and an increase in

room supply.

The average occupancy rate dropped by 10.2 per cent to 60.9 per cent compared to the same period

last year, according to the research company STR Global. The average daily room rate also dropped by

3.7 per cent to Dh389.42.

These pulled down the revenue per available room, a measure of a hotel’s profitability, by 13.5 per cent

to Dh237.26. STR Global attributed the decline to the slow Ramadan season.

The number of rooms in the capital increased by 6.6 per cent compared with the same period last year

and outstripped the demand during last month. One of the hotels to open in capital was the 146-room

Tryp by Wyndham in March.

The increased room supply in Dubai and Abu Dhabi has put pressure on occupancy and room rates, but

both markets are resilient, according to Matthew Green, the head of research and consultancy at CBRE

in Dubai.

“Hoteliers, as a result, are getting more creative in terms of offers,” he said. “For instance, they had

larger iftars with slightly higher rates to fill the gap in the room rates and occupancies,” he said.

But future drivers of hotel performance in Abu Dhabi and Dubai are strong.

“The Abu Dhabi airport [new terminal] is yet to open, and when it does so in 2017 it is going to be a

huge factor in achieving the future growth targets,” Mr Green said.


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DUBAI POLICE INVESTIGATE

VANDALISM AT PROPERTY FIRM

FOLLOWING CLOSURE

SUNDAY 26 JULY 2015

A leading estate agent and property management company in Dubai has gone out of business with the

loss of dozens of jobs.

S&K Estate Agents, which was also known as Smith & Ken, ceased trading last Tuesday without warning

to most of its 70 employees.

The glass door to the company’s office on floor 11 of Concord Tower in Media City has been smashed.

Staff at neighbouring businesses arrived at work yesterday to find shattered glass littering the corridors.

Police are investigating.

Many S&K staff only discovered they were out of a job when they turned up for work last Wednesday.

They are owed both wages and commission.

One former employee said: “No one has been paid. It had been going on for a long time. The company

had a mixed name in the market.

“But we came to work on Wednesday morning and saw signs on the door saying S&K was no longer in

business.

“I’d had a message at 5am saying the company had closed, but there are always rumours going around

in this business that companies are going to close, so I got up and got to work and found the note on

the door.”

The employee said S&K’s chief executive Benjamin Smith had notified brokers this month that a new

company was being set up and a re-branding was likely, after a dispute between the business’s owners.

Officers from Dubai Police are expected to return today to continue their investigation. Concord Tower

management was advised to restrict access to the 11th floor until the offices could be secured.

S&K Estate Agents was established as Smith & Ken in 2008. Two years ago it opened offices in Los

Angeles, California. The US office did not respond to a request for comment.

Property experts say an oversupply of brokers in a declining Dubai property market may have led to the

closure. There has been a fall in both the volume and value of property transactions in the first six

months of this year.

Figures from Dubai Land Department show a 14 per cent year-on-year decline in the number of homes

sold and a 15 per cent fall in the total value of transactions.

In its report on Dubai for the second quarter of this year, the property services company Asteco said the

sharpest decline in sales was at the top end of the market.

Asteco reported an 18 per cent year-on-year decline in prices of Palm Jumeirah villas and a 10 per cent

drop in property at Arabian Ranches.





Mario Volpi, a property expert and columnist for The National, said the market for estate agents in Dubai

was “already too crowded”, with more than 2,200 listed companies and about 5,500 registered

individuals operating in a market with 2.3 million residents.

“It’s not the first estate agency to close and it won’t be the last, but it is the biggest to close recently,”

he said.

Mr Volpi said operating costs for many agencies were high, especially the cost of media listings.

“Advertising is expensive and you need to be on these sites.”

Mark Wellman-Riggs, general manager of Crompton Partners Estate Agents, said house prices across the

board had declined by about 10 per cent since the start of 2015 and by 15 per cent in the past year.

“I get the impression that there is another 5 per cent to go before we stabilise,” he said.

“Investors are wary of the secondary market as they believe many existing homes are priced too high

and are looking to pick up bargains through distressed sales.”


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DH52M COMPENSATION FOR LAND

OWNERS IN AL NAKHEEL AREA

SUNDAY 09 AUGUST 2015

In line with the directives of His Highness Sheikh Humaid bin Rashid Al Nuaimi, Supreme Council

Member and Ruler of Ajman and Sheikh Ammar bin Humaid Al Nuaimi, Crown Prince of Ajman and

Chairman of Ajman Executive Council, the Department of Financial Affairs (DoFA), has started payment

of compensations totalling Dh52 million to property owners affected by the development project,

currently underway in Al Nakheel area.

The DoFA began issuing compensation cheques to the owners.

The development work is being carried out by the Ajman Department of Municipality and Planning

(DoMP).

Director General of the DoMP, Yaheya Ibrahim Ahmed thanked His Highness the Ruler of Ajman for his

directives to compensate the citizens.

He also praised the constructive co-operation with the DoFA, aimed at realising the leadership's vision

for comprehensive development.


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DUBAI PROPERTY MARKET RECEIVES

6,750 NEW HOMES

MONDAY 26 JULY 2015

About 6,750 new residential units were added to Dubai’s property market over the past three months,

bringing the total stock to 479,000 properties, according to a new report.

The ADIB / MPM Properties report states that most of the new units were delivered along the Sheikh

Mohammed Bin Zayed Road corridor, with new homes in the International Media Production Zone

making up 26 per cent of the supply.

The amount of new units delivered during the first half of the year climbed to 8,500, and MPM Properties

said that it expects a further 11,500 to be handed over during the second half of the year.

The increased supply meant that prices and rents continued to fall. Average sale prices dropped by 3.5

per cent and rents fell by 3 per cent on the previous quarter.

“The volume of new projects in the Dubai market means that properties will increasingly need to appeal

to potential buyers’ sense of value,” said Paul Maisfield, chief executive of MPM Properties. “That means

a shift towards well managed, self-contained and mid-market properties, particularly close to the Expo

2020 site. We are also seeing a greater emphasis on buyer incentives and unique selling points,

especially in the luxury segment and expect buyers to benefit from these trends.”

The report also warned that new leasehold property developments at the northern end of Dubai in areas

such as Al Nahda, Muhaisanah and Al Qusais Industrial Areas 3 & 4 could “further exert pressure” on

infrastructure, most notably roads between Dubai and Sharjah already facing serious traffic congestion

at peak hours.


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UNION PROPERTIES STARTS WORK ON

GREEN COMMUNITY PHASE THREE IN

DUBAI

SUNDAY 26 JULY 2015

Union Properties has begun construction on the third phase of its Green Community project in Dubai

Investments Park.

Contractor Shapoorji Pallonji Mideast has begun laying foundations at the site, which spreads over

138,000 square metres. It will contain 226 properties - 210 villas and 16 duplex apartments - and some

retail space.

The project will add to the 1,555 residential units that were developed during the first two phases of the

Green Community - 719 in phase one and 836 in phase two. Phase three is due to complete by mid-

2017.

Ahmed Al Marri, general manager of Union Properties, said: “We have selected Shapoorji Pallonji Group

due to their expertise in the real estate business, and especially their experience in building residential

communities.”

Enabling works at the project began in January and have been completed by Ward Adams.


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INDIANS, BRITS, PAKISTANIS TOP

EXPAT INVESTORS IN DUBAI PROPERTY


Indians, Britons and Pakistanis continued to remain the top three expatriate property investors in Dubai,

according to Dubai Land Department (DLD).

The total sum of investments in Dubai’s real estate market for the first half of 2015 exceeded Dh53

billion, with 19,848 investors from 142 nations making property transactions, the DLD said.

UAE nationals top the list with Dh11.5bn worth of Dubai property market transactions during the first

half of the year.

Nationals from India were ranked first for foreign investment, having made a total of 3,017 transactions

worth Dh7.8bn.

DLD’s list included the amount of real estate transactions conducted by foreign nationals in H1, with

13,166 investors from India, Pakistan, Britain, Canada, Russia, China, USA, France and Afghanistan

involved in deals worth a total of Dh30bn.

British investors were in second place having conducted deals worth Dh4.7bn, followed by Pakistani

investors with transactions worth Dh3.3bn.

Canadian investors came in at fourth place with transactions worth Dh1.8bn.

“One look at the figures from DLD’s Research and Real Estate Studies Department is enough to show us

that Dubai’s real estate sector is now enjoying sustainable growth. Based on the strong performance of

the market, we fully anticipate that the momentum will be continued throughout the next five years as

we lead up to Expo 2020, the biggest marketing event in the world,” said Sultan Butti bin Mejren,

Director General of DLD.

DLD’s report, issued by its Research and Real Estate Studies Department, revealed that GCC Investors

completed Dh17bn worth of transactions made by 3,926 investors in the first half of this year.

Emirati investment clearly formed the lion’s share of this figure, with UAE nationals making 2,130

transactions worth Dh11.5bn in the city’s property sector.

Saudi Arabia was ranked in second place on the list of GCC real estate investors, having made 999

transactions worth Dh3.2bn. Kuwait was at third place, followed by Qatar, Bahrain and Oman.

“The diversity in investors’ nationalities revealed by the report shows that the Dubai market is

international and that investor confidence is increasingly being cemented,” bin Mejren added.

DLD’s report showed that 2,756 investors from 16 Arab nations completed transactions worth more than

Dh6bn in the first half of 2015.

Jordanians made transactions to the value of Dh1.4bn, while Lebanese nationals were second on the list

of Arab investors having conducted Dh1.2bn worth of transactions. Investors from Egypt came in at

third place followed by those from Iraq, Yemen, Sudan, Algeria, Palestine and Morocco.

“The various financial rating agencies from around the world are very optimistic about the economic

indicators of the UAE in general and Dubai in particular, where all sectors show excellent growth rates

year-on-year,” said bin Mejren.





“This confirms the success of the emirate’s diversification policy. The policy has meant that the drop in

oil prices in global markets has not had a major negative impact on the nation’s economic performance.

The Dubai real estate market is evidence of this success, with its ability to attract buyers from around

the world. They have confidence in the future stability of the market and faith in the assurances

provided in terms of a rewarding return on investment,” he concluded.


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DUBAI TO DELIVER NEW WAVE OF

AFFORDABLE HOUSING OPTIONS


End-users are set to capitalise on stabilisation within the Dubai real estate market as more affordable

housing options enter the market ahead of Expo 2020, and price adjustments improve affordability of

existing stock.

Developers are lining up to unveil a wave of attractive new housing options during the 14th edition of

Cityscape Global which brings together more than 300 exhibitors from 30 different countries at Dubai

World Trade Centre next month.

Taking place from September 8-10, the world’s largest real estate investment and development event

for emerging markets will deliver a timely reminder that conditions in Dubai are being shaped naturally,

and that medium to long-term prospects remain positive.

"We must understand that Dubai is experiencing a normal market correction which was always

inevitable," said Wouter Molman, Director of Cityscape Group.

"The Expo 2020 win caused a sharp rise in property prices at the end of 2014, but the steps taken by

the government have helped regulate the market and the establishment of a rent index has created

more clarity for investors – all signs of a maturing market."

With end users now looking to take advantage of the stabilising property prices, more attractive housing

options are on the way from developers like MAG 5 Property Development which is using Cityscape

Global to introducing a new integrated and affordable residential community.

Offering over 1,000 residential units as well as providing retail, dining, leisure and entertainment

amenities, MAG 5 Boulevard is a 24-hour living, walkable community which will encompass more than

800,000 square feet of land. MAG 5 Property Development will be launching Phase 2 of the project at

Cityscape.

"MAG 5 Boulevard is aligned with the needs of the middle income earners," said Talal Moafaq Al Gaddah,

CEO, MAG 5 Property Development. "We are keen to capitalise on the growing demand for quality,

affordable residential communities in close proximity to the Al Maktoum International Airport and the

wider Dubai World Central area."

The value of the location was underlined by Mohammed Al Awadhi, VP, Real Estate, Dubai World

Central, who said: "By 2020, DWC is projected to become a self-sustained urban ecosystem where

thousands of professionals and their families will live and work."

Supported by the Dubai Land Department, Cityscape Global is the annual meeting point for key real

estate investors, developers, investment promotion authorities, architects, designers and other real

estate professionals to drive growth in real estate investment and development across emerging

markets globally.

In the wake of recent market reports the event will help put into perspective the much brighter longer

term reality of the Dubai property market.

"While a lot of the figures we are currently witnessing are not as positive as we’ve seen in previous

years, it seems clear that the medium to long-term future for Dubai real estate is healthy," said event





director Molman. "This is reflected in the build-up to the 14th edition of Cityscape Global, where we

expect the biggest assembly of exhibitors since 2008."

Craig Plumb, Head of Research at JLL Mena, said: "We expect transaction volumes and, subsequently

sale prices, to drop further in the second half of the year. But the single digit price correction we saw in

the first half of the year is a sharp contrast to declines we witnessed in 2008/2009 and is a clear

indication that the market is maturing."

Taking a new format this year, the Cityscape Global co-located conferences will be staged on the day

before the exhibition. The new format is expected to facilitate the coming together of more than 800

senior real estate professionals and government official who will explore opportunities and find solutions

to key challenges affecting the industry today.

The Facilities Management conference, jointly organised with Middle East Facilities Management

Association (MEFMA), and the Real Estate Brokers will run alongside the ‘Dubai Market Overview’ on

September 7 at the Conrad Hotel, Dubai.

Also running in tandem with the exhibition is the Cityscape Awards for Emerging Markets. The awards

programme attracts hundreds of entries from developers and architects behind real estate developments

across emerging markets globally. Winners will be announced at an elaborate ceremony taking place at

the Conrad Hotel, Dubai on September 8.


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DUBAI PROPERTY TRANSACTIONS

TUMBLE 69 PERCENT

WEDNESDAY 29 JULY 2015

The number of completed property deals in Dubai has tumbled by more than two-thirds, according to

JLL.

In its Dubai Q2 Market Report, the firm’s Mena head of research Craig Plumb said Dubai Land

Department figures show a 69 per cent drop in residential transactions during the first half of the year,

with 7,400 deals completed, compared to 23,800 in the same period last year.

The aggregate value of sales also dropped by 66 per cent to Dh12.7bn. Prices per unit, on the other

hand, only dropped by 8 per cent year-on-year.

“This single-digit price correction is in sharp contrast to declines we witnessed in 2008-09 and is a clear

indication that the market is maturing,” said Mr Plumb.

Despite this, JLL expects further declines in both the number and the prices of homes sold during the

second half of the year.

Rents remained flat during the quarter, but are expected to come under pressure from an anticipated

increase in supply.

Indeed, a wave of new off-plan properties were launched in Dubai during the second quarter of 2015,

contributing to the decline in the number of homes sold in the secondary market, according to a new

Cavendish Maxwell report.

The agency said that 7,900 units were released during the quarter across 19 projects.

The bulk of these are “affordable” properties – apartments (82 per cent) and town houses (17 per cent)

in secondary locations such as Dubai Silicon Oasis and Dubai World Central.

A similar glut of properties came on to the market in 2008 ahead of the last market crash, but

Cavendish Maxwell said that current conditions are not comparable.

The fact that most new projects contain affordable units with flexible payment plans, make them

appealing to a wider spectrum of end-users and investors, it said.

“The financial scars of the last market crash run deep for the people that lived through it and are still

here,” said managing partner Jay Grant. “That demographic is very cautious and whereas off-plan

properties flew off the shelves in 2007-08, it’s less impulsive this time. That’s not to say that people

won’t get caught out, but it’s a more considered market.”

Faisal Durrani, international research and business development manager at Cluttons, said that

according to his firm’s analysis, some 40,120 new units have been announced so far in 2015 – about

half of which are in Nshama’s Town Square. A further 4,000 were announced by Nakheel at the former

Dubai Waterfront site in Jebel Ali in January.

Mr Durrani argued that the short-term impact of such announcements would be limited, as it will take

about 10 years before Town Square is fully developed.





“Developers have learnt from the past and are carrying out these projects in phases. A lot of the

announcements are from state-owned developers, who have no inclination to rush them to market,” he

said.

He added that the historic average population growth for Dubai has been around 7 per cent, but even if

a lower rate of 5 per cent growth occurred between now and 2020, it would mean a population increase

of 400,000.

“If you look at the pipeline and the projected population growth, they are quite easily matched.”


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LANDMARK ZENATH TO OPEN

HUNDREDS OF MID-MARKET ROOMS IN

DUBAI THIS YEAR

THURSDAY 30 JULY 2015

Mid-market hotels in Dubai are set to face further pressure on room rates as hundreds of new rooms are

added.

Landmark Zenath Group plans to open five four-star properties under the Landmark brand by the end of

2017.

The hotels would require an investment of more than Dh100 million, most of which the Deira-based

developer and operator of mid-market hotels is likely to self-finance. Of the five new properties, two are

planned for Dubai Investments Park, with a total of 370 rooms. They are expected to open at the end of

this year and next year.

A 185-room hotel is earmarked for Mazaya Center on Sheikh Zayed Road by the end of the year, while a

175-room hotel is expected to be completed in Deira by 2017.

A 246-room Fujairah property is also due to open this year, the latest of several recent new hotels in the

eastern emirate.

Last month, occupancy at hotels in Dubai fell 15.4 per cent to 63.2 per cent, while the average daily

room rate dropped 8.8 per cent to Dh577.85 as supply rose 6.2 per cent year-on-year, according to STR

Global.

“Room rates would be affected and the Dubai government is trying to make Dubai more affordable, but

competition is also increasing in the mid-market segment, putting a tremendous pressure on room

rates,” said Deen Sadiq, the group director at the Landmark Zenath Group. “It would be a buyer’s

market for the next four to five years, but upscale properties would be under pressure more.”

The group operates four properties in Dubai under the Landmark brand, Ramada Deira and two hotel

apartment development in Jeddah.

In its half-yearly results published Thursday, London-listed InterContinental Hotels Group (IHG) reported

weaker business in the UAE despite a 9.9 per cent growth in Saudi Arabia. It did not provide further

details.

IHG manages 25 hotels, accounting for nearly 6,000 rooms, in Saudi Arabia under brands such as

InterContinental, Crowne Plaza and Holiday Inn, and plans to open more than 7,700 rooms across nine

hotels in the country over the next three to five years, said Pascal Gauvin, the chief operating officer for

India, Middle East and Africa at IHG.

IHG’s operating profit rose 9 per cent in the first half ending in June to US$337m.

The French hotel company Accor, which also released its earnings on Thursday, reported weaker trade in

Saudi Arabia and the Arabian Gulf countries because of Ramadan. Its first-half net profit was up by 68

per cent to €91 million (Dh365m).





Starwood Hotels and Resorts Worldwide, which operates the Sheraton and Westin brands, reported an

11 per cent fall in quarterly profit to $136m because of a strong dollar. It earns most of its revenue from

outside the United States.

In the Middle East and Africa region, it reported a 6.2 per cent dip in average room rate to $183.70 in

the second quarter while occupancy rates decreased by 1.4 percentage points to 62.5 per cent. Its

revenue per available room, a measure of a hotel’s profitability, decreased by 8.2 per cent to $114.93.


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With 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,

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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]

Julia Knibbs MSc

Manager – Research and Consultancy - UAE

+971 4 403 7789

[email protected]

VALUATION & ADVISORY

Our professional advisory services are conducted

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news brief 1 - asteco property management...a heavy recruitment drive in the first half of 2015,...

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