• Home
• /
• Business

Real estate on track for recovery in 2011

DUBAI — Property sector in Dubai is expected to be one of the best performers next year as real estate market is on track for recovery in 2011 in the emirate, DAMAC Properties Managing Director Ziad El Chaar said.

There is still a lot of cash on the sidelines, but there are opportunity costs to keeping liquid cash, El Chaar said, adding: “Investors will now be weighing up their options about where to invest next year, and property is shaping up to be one of the best performing sectors.”

DAMAC, a Dubai-based company, is planning to deliver eight projects in Dubai during 2011. The property firm, one of the largest Middle East private developers, has more than 12,000 units under development throughout the Middle East and North Africa (MENA) region.

DAMAC is also very optimistic about the property sector’s performance in MENA region and said the region is poised to grow next year.

“There are strong economic fundamentals underpinning the case for property prices to rise across the MENA region in 2011. DAMAC Properties .... is expecting a lot of activity in 2011, as investors rush to buy real estate to capitalise on the predicted upswing” El Chaar added.

The property sectors in Saudi Arabia, Lebanon and Egypt are forecast to report double digit growth in 2011. Lebanon’s Director General of the Economy Ministry Fuad Fleifel is predicting property prices in Beirut will rise another 15 per cent in 2011.

Property prices in Egypt grew 10 per cent this year according to Global Property Guide, with similar growth forecast for next year. Property prices in some parts of Saudi Arabia surged as much as 40 per cent in the second half of 2010 according to Banque Saudi Fransi, and will likely continue to appreciate in the new year.

The region is also getting a boost from Qatar’s successful 2022 World Cup bid, with Shuaa Capital predicting Qatar may spend close to $90 billion on housing and infrastructure in the lead up to the tournament. “DAMAC Properties has several major projects ongoing in Qatar, and the World Cup announcement has certainly reinvigorated Qatar’s real estate market” said El Chaar.

In the last 12 months DAMAC has awarded new contracts to the value of $1billion including 15 main contracts in Dubai, two main contracts in Abu Dhabi and one main contract in Saudi Arabia. The developer said its core focus for 2011 will be construction and delivery of its projects across the region, with a strong emphasis on satisfying customers.

The International Monetary Fund is predicting GDP will expand 5.1 per cent in the MENA region next year, higher than the forecast global average of just 4.2 per cent. The region is expected to be second only to Asia in terms of annual growth, with MENA economies expanding at more than double the pace of advanced nations including Europe and the United States.

“The region will be a powerhouse of the global economy in 2011 and DAMAC with large regional footprint is well positioned to take full advantage of the upturn” El Chaar said.

abdulbasit@khaleejtimes.com