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The Monthly Real Estate Report Of SAK Holding Group Market Watch Office

The Monthly Real Estate Report of the Market Watch Office of SAK Holding Group, believes that the real estate sector is still being tested by external factors affecting its domestic course, these factors continue to affect the sector despite efforts taken to protect it from the repercussions of the global recession caused by sharp decline of oil prices, through a bundle of measures and incentive packages led directly by the government, who announced it’s clear and explicit commitment to spending on projects. The sector is still waiting to see the if cutting down oil production agreement will improve prices, because this agreement is expected to fail, some countries including major oil producing countries are concerned that the growth in the production of US rock oil will start a Prices war by the end of next June.
Real Estate transactions during the last few weeks displayed fears from fluctuating oil prices, and that recession will go one and evolves or grows in more than one direction, will persist in the minds of investors and real estate developers, specially the major ones, this category’s investments  are worth billions, it is still rescheduling its priorities, this stage is essential in judge course of the market during the next months, any market future projections must not be isolated from this category of investors, real estate developers must carefully examine the market, adjust to coupe with current conditions, develop plans and strategies to play a positive role in enhancing the real estate market that need professional and experienced investors and senior developers who are good at planning, developing opportunities and creating quality real estate products and projects.
Market Watch Office, “field and analytical monitoring of local market indicators reveals that the conditions in the market are within normal standards, investments confirms existence of capitals that believes Qatari real estate market is appealing and a good choice, a portion of liquidity returned to the market, especially liquidity in the stock exchange market, indicates seasonal liquidity is looking for other investment channels. The current real estate transactions values, and improvement in demand for empty land compared to the way it used to be and future projections, is caused by government efforts taken at different levels, and in different directions, to protect the real estate sector from foreign factors, as well as the diversification of the real estate sector, real estate initiatives  launched by the private sector such as putting out land for building service projects, logistics, commercial and educational projects, growing interest in the tourism and hospitality sector, and other projects that go in parallel with the commitment to spend on major government and development projects.
The Real Estate Report, “all of the above keeps the major real estate investors interested in the real estate market. It stressed the need for continuous evaluation of opportunities and investment options proceeding from the changes in the market, which reinforces the need to build real estate partnerships with strong real estate developers that support the credit status of investors, especially small investors and new investors, it also stressed the importance of adopting real estate competitiveness projects of added value to support its position in the market, as well as adopting realistic and innovative and attractive marketing and promotional plans.
Investment awareness is extremely important, it leads to better understanding of the market, confronting challenges and variables transparently and unswervingly. We are witnessing injecting real estate investments into specific types of real estate projects, especially housing projects targeting the middle income segment, which will enable them to obtain housing at affordable and reasonable rates. Forcing competition to focus on services, offers and promotions to give properties an attractive competitive value.
Scarcity Of Liquidity Negative Effects On Real Estate Market Indicators
Central Bank Efforts, Specially Liquidity
The Report praised Central Bank's efforts to uphold financial stability during current conditions and challenges, to strengthen country's financial safety net that protects all economic sectors. The Report said the real estate sector is at the forefront of beneficiaries of central bank plans to maintain financial stability, including investor support programs, increased customer confidence, continued efforts to support the improvement of regulatory framework for implementation of prudential safety policies, enhancing market structure, processes and coordination between regulators and further development of financial markets.
The report touched on the issue of interest rates on loans and credit facilities, which rose in mid-December by 0.5%. It hoped that the issue of real estate liquidity will be dealt with by the Central Bank. Last year, the real estate sector was granted 129 billion riyals in loans out of the total amount of loans reaching 440 billion riyals. This justifies pointing out to negative aspects the current condition of liquidity, which clearly affects the indicators of the real estate market, developers and investors plans. In addition to raising lending rate, banks' excessive protectionism, under the fear of exposure to mortgage risks, hinder real estate sector attempts to come out of the bottleneck.
The report marked the importance of measures taken by the Central Bank to protect the real estate sector and other economic sectors from failing to repay the loans. However, lack of liquidity may have negative repercussions on activities of the sector as a whole, and on continuing to pursue vital projects and sustain prosperity and growth, which lead to an increase in prices of real estate products to an unrealistic limit, making it difficult to provide affordable housing and commercial units to end-user.
Speed of Achievement is a Translation of government priorities in managing billion riyals project.”
Real Estate Sector Is A Safe Haven For Investors
The works of the first phase of Al-Rayyan highway development project that was achieved recently in terms of speed of implementation and completing the project two months ahead of schedule, manifest the directives and priorities of the government in the way of managing billion riyals projects implemented by the State. It displays the future of the process of construction and development of major projects in light of the continuation of the decision to continue working on the mechanism of evaluation of government projects in force. All projects will soon exhibits the plans of the State in terms of evaluating the performance of contractors and suppliers according to the criteria of transparency and justice, which will support the fundamentals of the real estate sector and strengthen its location to remain a safe haven for investors.
ministries and concerned authorities insistence on developing the performance database for contractors, suppliers and service providers working in projects implemented by the State in different regions, as well as pressure on contracting companies to fulfill their obligations in accordance with the terms set by the contract and according to agreed specifications and the tightening of fines and penalties for companies in arrears and violation are undoubtedly important steps towards accelerating pace of urban process and population growth,
The report commended Ministry of Transportation & Communications efforts undertaken to prepare a system for field monitoring of projects and data. Based on press reports it is working on establishing performance indicators for companies working in these projects in order to stimulate them. It will also launch various  services packages for land transport sector, it will also launch a system to set locations for pedestrian crossing to facilitate planning process undertaken by companies concerned in the field of roads.
Facilitating Licensing Mechanisms Speed Up Positivity Of Commercial Streets In The Economic Cycle
26 Kilometers Of Commercial Streets Launched By The End Of 2017
The report expected that the Ministry of Municipality & Environment decision to launch 26 kilometers of commercial streets this year to cover all regions of the country will reflect positively on the flow of business and its diversity in the medium and long term, This category of vital commercial projects has been absent from the real estate developers' agenda and the development plans that have focused on the strategic and residential projects at the expense of this category, causing the scarcity of this kind of vital commercial properties despite the increase in population and the prosperity of the commercial movement in the country.

The report said the country will see increasing demand for commercial streets so licensing mechanisms should be facilitated as this will accelerate their positive impact on trade and economy, the presence of new commercial streets in modern densely populated areas is important which must be commensurate with the capabilities of traders and the nature of commercial activity that will be required in the beneficiary areas on the medium and long term the report mentioned what has been announced previously by the concerned parties regarding the new commercial streets will be implemented in different areas which are:
Al Doha Al Jadeed Street, Al-Nada Street, Al Furousiya Street, Khalifa City Road, Al Wifaq Street, Khaybar Street, Othman Bin Affan Street, Rawdat Al Khail, and Ibn Khaldun Street.
Service And Development Projects Continue To Attract Promising Real Estate Opportunities
Urbanization Promotes Growth Of Peripheral Areas
The report monitored growth in other areas, such as Al-Wakra and Al-Wukair, which are witnessing significant urban expansion in parallel with infrastructure development projects and development of roads networks, as well as service and development projects, such as the Central Market in Al-Wakra, which covers a total area of about 11,300 square meters that includes a central market, administrative offices, shops and meat shops. In addition to the Al Wakra beach, which extends over a total area of about 13 thousand square meters, 300-boat boat stand, other vital and service facilities.
The report predicted that growth will accelerate in Al- Wakra, North and South Al Wakir, Al Mashaf, there is a lot of urban activity activities in these areas that deserves monitoring, the continuation of infrastructure and road and transportation projects in these areas will contribute in the formation of new residential areas, which means new real estate opportunities. In addition, creating many new areas in the vicinity of Doha and beyond, will enhance demand for land in those areas. In this context, according to Al Wakra municipality, the number of residential plots that will be included in the urban expansion in the next phase is expected to reach about 5000 new housing lots. The number of building permits issued so far for the government division project in Al Mashaf and Al Wukair area exceeds 1,100 building permits. There are expectations that the pace of urban expansion will continue with the nearing of completion of the modern transport network projects linking these areas to Doha.
In a related context, the report talked about the projects that continue to be completed, as announced recently by the Public Works Authority, describing it as a remarkable development as it has been completed sixty days ahead of schedule, which is remarkable given the large volume of the works of the first phase of Al Rayyan Highway Development Project, which extends about 2.9 kilometers west of Khalid bin Abdullah Al-Attiyah roundabout (Al-Rayyan new roundabout) to the east of Bani Hajar roundabout and includes the tunnels of the Citadel and Al Shafi and the establishment of 4 tracks in each direction separated by a central island and the establishment of side roads with a length of 2 km and service routes with a length of about 5.8 km, this is described as one of the great achievements achieved by the development of Al Rayyan Road in the first and second phase.
50.6 Thousand Workers Working In The Private Sector Schools During 2015
41 pieces of land assigned to establish private schools
The report noted a growing interest in supporting and promoting the growth of the educational sector in Qatar, as well as establishing a public-private partnership to build private schools. A number of stakeholders are preparing to launch some 41 plots of land for the private sector to invest in the private education sector to build private schools of symbolic rent on two stages, the first involves the launching about 11 plots of land, the second phase includes launching 30 plots of land for construction of educational monuments to teach high quality school curriculums in order to raise the level of education in the country to meet the requirements of Qatar Vision 2030.
Education Sector accomplished sustainable growth in the past few years. Its revenues increased from 2 billion QAR in 2011 to 5.8 billion QAR in 2015 according to reports published by Ministry of Economy & Commerce. The number of people working in this sector increased from 26.9 thousand in 2011 to about 50.6 thousand in 2015, nearly double. This rate is significantly increasing.
the total employment in Qatar, which amounted to about 53.9% during the same period, raising its contribution to the total employment from 2.1% in 2011 to about 2.6% in 2015.
Registration Of Real Estate Leases Is Strengthening Market Stability.
Legislations Property Leasing Law
The report praised recent amendments concerning registration of lease contracts in the Real Estate Lease Registration Office, which was introduced by the Council of Ministers on the Rent Law and referred to the Shura Council as it comes within the framework of legislative and legal follow-up to the real estate growth experienced by the country and the large increase in demand for residential and administrative categories, commercial units, this important step is required in order to consolidate the stability of the leasing market and its regularity in a transparent and clear legal framework to resolve all disputes and leasing disputes for the benefit of both parties, ie the owner on the one hand and the final beneficiary or tenant on the other.

Reducing the importance of what is raised about the impact of registration fees on rent increases, which is considered a nominal fee of not more than 0.5% of the annual rental value, for each residential unit or commercial or other units referred to in the licenses to build the property at a minimum of 250 riyals, Note that a decision by the Council of Ministers on the proposal of the Minister of Municipality and Environment may amend this fee.

Owners Awareness Of Realty Cycle And Correction Of Prices Beginning Of Market Stability
market awaits effects of injecting thousands of residential and commercial units
In line with external factors influencing the real estate sector, continuous pumping of real estate units into Qatar’s market is a fact that justifies the cautious anticipation of the potential effects of supply density compared to demand. It is expected that the pumping all categories of real estate units will reach a peak during the next three years, owners of thousands of residential units, commercial offices, hundreds of towers, shopping complexes and others have to accept this fact and then understand and interact with this fact realistically and recognize that the course of real estate and price correction and rent is a fait accompli, the report said that this may be the starting point to see stability and realism in the flow of prices traded, whether at the level of sale or lease.
The report predicted that various regions of will experience relative fluctuations in the supply and demand equation due to competition for good market shares. This will lead to the imbalance of prices, trading and expected investment returns. This will clearly be reflected in two main real estate categories: the residential and commercial sectors, with the accelerated completion of projects targeted at the end beneficiaries of these two categories. Related parties are monitoring the presence of 60,000 housing units and approximately 700 towers and buildings that may be put on the Qatari market within 2020.
Heated Competitions In The Malls Club Drops Prices By 20%
After reviewing the various real estate categories, the report noted unfavorable windfall for landlords, which could result in a 10% to 20% reduction in the retail segment of retail units. It is likely that decrease in rents of commercial complexes will reach 20%, especially in some commercial complexes and malls that are geographically converging. It is expected that there will be fierce competition to attract some brands that may benefit from competition to attract them by improving the terms of contracting in terms of space, Offered by modern malls. It is noted that Qatar Mall opened in December 2016, Ezdan Mall Al-Wakra opened in the same period of the same year and this month Doha Festival City is one of the malls that will join the shopping malls club, the race continue to open Al Hazm Mall, and Bin Tawar Mall, at close periods of times, which affects the opportunities of these complexes in the distribution of luster to the largest proportion of shoppers and invite them to know their shops and brands and services and thus increases the challenges of marketing.
The report predicts that the leaders of the commercial complexes sector will have to deal with the expected large increase in supply and the consequent decline in leasing values. This requires non-traditional wisdom and management of owners and investors to reduce vacant spaces and fill them with brands, companies and businesses that attract shoppers.
Increase in supply of residential units provides aptitude for growth
At the level of housing projects, the signs promise to build more units that will increase the supply and will strengthen the real estate market to ensure the solvency of the elements of growth coupled with the expected population increase with the approach of the World Cup 2022, which will be hosted by Qatar, Ezdan Holding Group has revealed the imminent launch of Ezdan Oasis, a 1 million square meter project with residential and commercial units of about 9,200 units, the largest real estate addition to the market, with a population of more than 35,000.
What gives the Ezdan Oasis project a positive vibe in the real estate market is the geographic location of the project, which is located close to a modern network of roads and transportation linking Al-Wuakair and Al Wakrah to Doha and other areas. The project provide the type of accommodation and services that attracts the middle income category, the first stages of the project will be launched coming June.