Qatar The Gamble or Destiny

ASA February 2014

Qatar’s A Gamble OR A Destiny

The Property Perspective

Opportunities

From US Credit Crunch to Global Economic Crisis

LONG TERM IMPLICATIONS

Shift from Mature to Emerging

markets

Stronger emerging market giants from

the Middle East and BRIC countries

Increasing role for Gulf states on

global stage

Opportunity for emerging countries to

enter new markets and geographies

Move to polarized global economy

Economic Crisis Synopsis

IMMEDIATE IMPACT

Fluctuation in commodity prices

Fears of a significant global recession

Nationalization of Banks

Consumer confidence affected

Stock markets are taking a plunge

Investor pessimism

Sharp increase in corporate defaults

Weakening of the traditional western

corporate leaders

Impact of Financial Crisis on Real Estate Markets

Cheap & Plentiful Debt

Robust Demand

Rents Rising

Increasingly International Market

Cap Rates Falling

Prime = Secondary

Traded Volumes High

More Buyers than Sellers

Pre-Crisis Post-Crisis

Qatar , Middle East Less Impacted

Source: IMF, Word Economic Outlook, March 2014

0

2

4

6

8

10

12

2011 2012 2013 2014 2015

GD

P G

row

th (%

)

World Economic Outlook Q1, 2014

World Advanced economies Middle East Qatar

Stages in Market Maturity

Time

Required Returns

(Hurdle Rates)

Market Volatility

Transparency

Core

Catalyst

Growth Maturing

Doha

Abu Dhabi London

New York

Dubai Cairo

Muscat

Moscow

Shanghai

Source:– World Winning Cities 2014

MENA Transparency

Highly Transparent

Transparent

Semi-Transparent

Low-Transparent

Opaque Sudan, Algeria, Syria

Tier 1

Tier 2

Tier 3

Tier 4

Tier 5

Saudi Arabia, Morocco, Egypt

Oman, Kuwait

Pakistan, UAE (Other Emirates)

Dubai, Qatar

Bahrain

Abu Dhabi

Investor Sentiment – Global

Middle East still seen as strongest

performing market globally (36%) although

this has fallen from 56% back in September

Improvement in expected performance in

Western Europe from 2% since last survey

Asia Pacific is seen as second strongest -

increased from 20% since last survey

Improvement in expected performance in

North America from 5% since last survey

Source: Jones Lang LaSalle ISS, March 2014

North America

10%

South America

8%

Eastern Europe

3%

Western Europe

7%

Middle East

36%

Africa

10%

Asia Pacif ic

26%

Investor Sentiment - MENA

Bahrain

6%

Kuw ait

2%

Oman

2%

Levant

5%

North Africa

4%

Saudi Arabia

25%UAE - Dubai

11%

UAE - Abu Dhabi

26%

Qatar

19%

Saudi Arabia offers strong potential –

large and rapidly growing market

continues to open up and offer new

opportunities

Qatar expected to offer strong

performance building upon its reputation

as the next emerging GCC real estate

market and its gas wealth

Investors still remain bullish towards the

UAE, especially Abu Dhabi

Source: Jones Lang LaSalle ISS, March 2014

Key Strengths of Qatar

Growing population 1

Opportunity for infrastructure led investment 2

Strong government support 3 3

Highest GDP per capita in the world 4 4

Ample off-balance sheet income to support growth 3 5

Gas based economy (less fluctuating prices) 4 6

3 7

4

Regional influence

Qatar – World’s Highest GDP

Source: IMF January 2014

Domestic and regional infrastructure

investment

Securing the future through an active

global agenda

Growth Estimates (2010 - 2014)

Source: Various

Requirements to Recovery Dec 2013 May 2014 Dec 2013 May 2014

Macro Economic Real Estate

Global economic stability Increased occupier demand

Recovery in oil prices Reduction of Future supply

pipeline

Stability in employment levels Stabilisation of pricing levels

Financial / Liquidity Increasing transaction levels

Decline in cost of capital (interest rates) Consolidation of real estate

participants

Recovery in equity markets Implementation of new

investment paradigm

Recapitalization of banking sector Supporting Factors

Increased funding available to real

estate sector

Recovery in tourism

Improved brand perception

Required

Underway

Improvement in corporate

governance

Achieved Concerted government action

Source: Jones Lang LaSalle

Mexico City

Santiago

Buenos Aires

Sao Paulo Johannesburg

Kuala Lumpur

Bangkok

Shanghai

Beijing

Delhi

Bangalore

Mumbai

Moscow

Budapest

Prague Warsaw

Abu Dhabi

Doha

Source: World Winning Cities, 2014

Emerging World Winning Cities

Doha: A Destination in the Making

Source: World Winning Cities, 2014

1. Performance

2. Planning

3. Population

4. Place Making

5. Power

6. People

7. Purity

8. Process

9. Property

10. Physical

Thank You