qatar report q2 - asteco property management · qatar report q2 2012 with over 25 years’...
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Average Apartment Sales Prices (Q2 2012)
Average Villa Rental Rates (Q2 2012)
Average Office Rental Rates (Q2 2012)
West Bay A Ring Road C Ring Road D Ring Road Old Doha Airport Road
QA
R/p
m
3 BR 4 BR 5 BR
Ain Khaled
QA
R/m
2
QA
R/m
2 /p
m
Primary Market Secondary Market
Porto Arabia-Pearl Viva Bahriya-Pearl Lagoon Plaza
Al Dafna Al Waab Al Hilal Abu Hamour West Bay West Bay Lagoon Al Gharrafa Al Khraytiyat
Apartment Sales Office Sales Apartment Rentals Villa Rentals Office Rentals
Q-o
-Q P
erce
ntag
e Ch
ange
195
110
140 130
105
145
0
50
100
150
200
250
-25%
-15%
-5%
5%
15%
25%
5%
4%
3%
2%
1%
0%
-1%
Jun Sep Dec Mar Jun Sep Dec Mar
Mar 2012 Jun 2012
Jun Sep Dec Mar Jun
2009 2010 2011 2012
13,500
15,500
12,500
11,000
14,500
9,500
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
Customer Management: +974 4411 3818 | www.astecoreports.com
Qatar Report Q22012
With over 25 years’ experience in the Middle East, Asteco’s Professional Services team brings together a group of the Gulf’s leading real estate experts.
Asteco’s network of offices in Abu Dhabi, Al Ain, Dubai, Northern Emirates, Qatar, Bahrain and Jordan not only provides a deep understanding of local markets but also enables us to undertake large instructions where we can quickly apply resources to meet the client’s requirements.
Real Estate Monitor
The line graph below demonstrates the average percentage sales and rental trend on a quarterly basis.
Marginal residential rental increases were witnessed across most of the locations during Q2 2012.
Rental rates increased by up to 8% for one- and two-bedroom apartments in certain locations.
Villa rental rates increased by 4% on average mainly due to limited supply.
Waiting lists are now being seen at the very best quality villa compounds.
Office demand remained static since Q1 2012.
UDC plans to reduce the master community service charges at the Pearl-Qatar by approximately 33%.
Highlights
Rental Rates(QAR/pm)
Sales Prices(QAR/m2)
Min Max Min Max
Apartment
Studio 2,750 7,500
9,000 16,0001 BR 3,000 11,000
2 BR 4,250 14,000
3 BR 6,000 17,500
Villa
3 BR 7,500 19,000
- -4 BR 9,000 26,000
5 BR 10,500 31,000
Office Per m2 90 240 14,000
Property Market Summary
02www.astecoreports.com
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Average Apartment Sales Prices (Q2 2012)
Average Villa Rental Rates (Q2 2012)
Average Office Rental Rates (Q2 2012)
West Bay A Ring Road C Ring Road D Ring Road Old Doha Airport Road
QA
R/p
m
3 BR 4 BR 5 BR
Ain Khaled
QA
R/m
2
QA
R/m
2 /p
m
Primary Market Secondary Market
Porto Arabia-Pearl Viva Bahriya-Pearl Lagoon Plaza
Al Dafna Al Waab Al Hilal Abu Hamour West Bay West Bay Lagoon Al Gharrafa Al Khraytiyat
Apartment Sales Office Sales Apartment Rentals Villa Rentals Office Rentals
Q-o
-Q P
erce
ntag
e Ch
ange
195
110
140 130
105
145
0
50
100
150
200
250
-25%
-15%
-5%
5%
15%
25%
5%
4%
3%
2%
1%
0%
-1%
Jun Sep Dec Mar Jun Sep Dec Mar
Mar 2012 Jun 2012
Jun Sep Dec Mar Jun
2009 2010 2011 2012
13,500
15,500
12,500
11,000
14,500
9,500
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
For additional information call +974 4411 3818 or email [email protected]
Residential Leasing Market
Residential Sales Market
As forecasted in our Q1 2012 report, our research indicates marginal rental increases during Q2 2012 across most of the locations surveyed. Asteco attributes this demand to a steady increase in population and visitors to Qatar.
The impact of high occupancy rates is especially prominent for one- and two-bedroom apartments where rental growth of up to 8% has been witnessed, compared to last quarter.
Demand for one-bedroom apartments is now beginning to outstrip supply in various locations, particularly in the Diplomatic District and the Pearl-Qatar which offers good quality accommodation. Tenants arriving from mature markets where good quality accommodation is generally more available, are looking for the best quality apartments, in each budget category.
Rental growth for the remainder of the year may be limited as a significant amount of residential stock is scheduled to complete by year end. However, if the population increase gains momentum, the market may experience a healthy supply and demand balance, particularly in the one- and two-bedroom categories.
Similarly, Q2 2012 saw a marginal increase in demand for quality residential villas, particularly in modern, well serviced compounds.
The most superior compounds are now experiencing waiting lists for new tenants.
Supply in the high-end villa market is less prevalent than the apartment market and Asteco forecasts potential rental growth for villa accommodation for the remainder of the year.
There was no material change in the residential sales market in comparison to the first quarter of 2012.
Enquiries remained at similar levels, but with a noticeable increase for smaller one-bedroom apartments or studios, particularly at the Pearl-Qatar. This demand predominantly came from private Qatari individuals considering property as an alternative to cash reserves. The smaller unit sizes in these categories allow purchasers to invest a limited amount of equity when utilising a mortgage to finance an acquisition.
United Development Company (UDC), the master developer of the Pearl-Qatar, recently announced a planned reduction in the master community services charge of approximately 33%, starting 1st July 2012.
UDC also announced the signing of an agreement that will see Qtel acquiring the full communications network of the Pearl-Qatar, allowing Qtel to offer full voice, high-speed broadband internet and Mozaic TV entertainment services.
The reduction in master community service charges will have a positive effect on investment yields as investors’ operational costs will be reduced. An improved communications network will also add value to the overall offering of the Pearl-Qatar as a residential location.
Average Apartment Rental Rates (QAR/pm)
Location 1 BR 2 BR 3 BR
Al Sadd 5,125 6,500 7,625
Bin Mahmoud 4,250 5,875 7,500
Al Muntazah 3,625 5,375 6,625
Najma 3,625 5,125 6,500
West Bay/Dafna 7,500 10,000 13,500
Al Maamoura 4,500 5,750 6,625
Bin Omran 4,500 5,750 6,625
Old Airport 4,750 6,625 6,750
Pearl-Qatar 9,750 13,000 16,250
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00
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Average Apartment Sales Prices (Q2 2012)
Average Villa Rental Rates (Q2 2012)
Average Office Rental Rates (Q2 2012)
West Bay A Ring Road C Ring Road D Ring Road Old Doha Airport Road
QA
R/p
m
3 BR 4 BR 5 BR
Ain Khaled
QA
R/m
2
QA
R/m
2 /p
m
Primary Market Secondary Market
Porto Arabia-Pearl Viva Bahriya-Pearl Lagoon Plaza
Al Dafna Al Waab Al Hilal Abu Hamour West Bay West Bay Lagoon Al Gharrafa Al Khraytiyat
Apartment Sales Office Sales Apartment Rentals Villa Rentals Office Rentals
Q-o
-Q P
erce
ntag
e Ch
ange
195
110
140 130
105
145
0
50
100
150
200
250
-25%
-15%
-5%
5%
15%
25%
5%
4%
3%
2%
1%
0%
-1%
Jun Sep Dec Mar Jun Sep Dec Mar
Mar 2012 Jun 2012
Jun Sep Dec Mar Jun
2009 2010 2011 2012
13,500
15,500
12,500
11,000
14,500
9,500
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
03www.astecoreports.com For additional information call +974 4411 3818 or email [email protected]
Qatar Report - Q2 2012
Office Market Office rents remained static with no significant changes since the first quarter of the year.
Generally, supply continues to outstrip demand. Indeed, additional office buildings are scheduled for completion by Q4 2012 and we anticipate supply levels will continue to grow in 2012 and 2013.
However, demand is likely to increase during this period from occupiers associated with development and infrastructure improvements.
The majority of demand during this quarter was for fully fitted office suites under 500 square metres in good locations.
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20,7
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14,2
50
13,2
50
12,2
50
13,0
00
24,0
00
27,5
00
13,2
50
11,0
00
Average Apartment Sales Prices (Q2 2012)
Average Villa Rental Rates (Q2 2012)
Average Office Rental Rates (Q2 2012)
West Bay A Ring Road C Ring Road D Ring Road Old Doha Airport Road
QA
R/p
m
3 BR 4 BR 5 BR
Ain Khaled
QA
R/m
2
QA
R/m
2 /p
m
Primary Market Secondary Market
Porto Arabia-Pearl Viva Bahriya-Pearl Lagoon Plaza
Al Dafna Al Waab Al Hilal Abu Hamour West Bay West Bay Lagoon Al Gharrafa Al Khraytiyat
Apartment Sales Office Sales Apartment Rentals Villa Rentals Office Rentals
Q-o
-Q P
erce
ntag
e Ch
ange
195
110
140 130
105
145
0
50
100
150
200
250
-25%
-15%
-5%
5%
15%
25%
5%
4%
3%
2%
1%
0%
-1%
Jun Sep Dec Mar Jun Sep Dec Mar
Mar 2012 Jun 2012
Jun Sep Dec Mar Jun
2009 2010 2011 2012
13,500
15,500
12,500
11,000
14,500
9,500
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
The Importance of Professional Valuations for Insurance Purposes
Professional Valuations – Advantages
Real estate valuations are an important consideration for all property owners. At the International Conference on Real Estate Valuation, held in Doha on 17 April, His Excellency the Minister of Justice, Mr. Hassan Bin Abdullah Al Ghanim, delivered a key note speech in which he called for “legislation and regulation” in the valuation services sector in Qatar.
Asteco recommends to all our clients that the matter of buildings insurance be taken seriously, as well as the risks associated with property ownership in the context of the overall risk management of portfolios and businesses.
The purpose of insurance is to protect the owner against unwanted, unforeseen and unexpected events. The principal is that the building owner, in the event of a loss, is returned to a position comparable to that before the loss occurred.
Buildings insurance will ideally provide cover for some or all of the following risks: fire; lightning; explosion; earthquake; storm; flood; collision; impact; riot; act of terrorism; civil unrest; theft and malicious acts; subsidence and ground heave.
The Royal Institution of Chartered Surveyors (RICS) provides its members (Valuers) with guidance in relation to reinstatement costs
for building insurance reinstatement valuations, which should be undertaken in accordance with the Building Cost Information Service (BCIS) guide.
The BCIS is UK based and therefore not relevant in the Qatar market. Qatar does not have a construction costs index; therefore, the importance of seeking the services of appropriately qualified costs consultants to value assets for insurance purposes is paramount.
We advise our clients to take particular note of the following clauses in order to assess the overall suitability of the insurance policy to the client and their business: insured sum; adjoining buildings clause; demolition and removal of debris; loss of rent; acts of terrorism; civil unrest; war; sabotage and riot; architects’ and professional fees; fines and penalties; flood and water leak coverage; subsidence and landslip.
The ‘Insured Sum’, based on the reinstatement value, is not the same as the market value (as defined by the RICS and other professional valuation bodies).
The reinstatement value is the cost of replacement, associated fees and disbursements required to return the asset to a comparable position prior to the loss occurring.
Each asset is assessed individually;
The insured sum is based on a prescribed methodology;
The valuation will be used as the basis for negotiations in the event of a loss, and is more likely to be accepted by insurance companies;
The cost analysis used to derive the insured sum is a useful benchmark in assessing part loss claims;
There is less risk to the building owner of under insuring;
There is less risk to the building owner of over insuring and he will save on premium costs.
Asteco adopts international standards in accordance with the RICS and International Valuation Standards Council (IVSC). All our valuations are undertaken by appropriately qualified valuers based in Qatar.
Customer Management: +974 4411 3818 www.astecoreports.com
DISCLAIMER: The information contained in this report has been obtained from and is based upon sources that Asteco Property Management believes to be reliable, however, no warranty or representation, expressed or implied, is made to the accuracy or completeness of the information contained herein, and same is submitted subject to errors, omissions, change of price, rental or other conditions, withdrawal without notice, and to any special listing conditions imposed by our principals. Asteco Property Management will not be held responsible for any third-party contributions. All opinions and estimates included in this report constitute Asteco Property Management’s judgment, as of the date of this report and are subject to change without notice. Figures contained in this report are derived from a basket of locations highlighted in this report and therefore represent a snapshot of the Dubai market. Due care and attention has been used in the preparation of forecast information. However, actual results may vary from forecasts and any variation may be materially positive or negative. Forecasts, by their very nature, involve risk and uncertainty because they relate to future events and circumstances which are beyond Asteco Property Management’s control. For a full in-depth study of the market, please contact Asteco Property Management’s research team. Asteco Qatar (LLC). Commercial Licence No. 38137. Paid-up Capital QAR5,000,000.
Asteco Qatar LLCOur breadth of experience across all the main property sectors is underpinned by our sales, leasing and property management teams transacting in the market, and a wealth of research that supports our decision making.
Research
Asteco’s Research Department provides investors and developers with essential real estate knowledge to ensure clients understand their com-petitors, target markets and their long-term strategies.
Sales
Asteco’s internationally qualified team has enjoyed over two decades of experience within the highly dynamic Middle East property market.
Consultancy
Asteco’s Consultancy Department provides comprehensive advice on market trends and solid solutions, from project concept to completion. Asteco’s consultancy reports stimulate initial investment to financial institutions and other private equity providers.
Leasing
Asteco is the leading leasing agent in the Qatar and is the sole agent for a number of key developments locally and throughout the region.
Valuations
The team is fully independent in its approach and adheres to the Royal Institution of Chartered Surveyors’ (RICS) valuation standards.
Property Management
Asteco manages corporate portfolios as well as local and international funds throughout the UAE and region.
Jed Wolfe BSc MRICS
Omar Kabbara Chris MurphyBSc FRICS
Jenny Weidling
Managing Director - Asteco QatarAssociate Director, Regional - SaudiArabia, Qatar & Bahrain
Senior Sales and Leasing Manager
Head of Research, Consultancy and Valuations
Senior Research Analyst, Dubai
+974 4411 3818 +974 4411 3818 +974 4411 3818 +971 4 403 7777
[email protected] [email protected] [email protected] [email protected]
QATAR
KINGDOM OF SAUDI ARABIA
JORDAN
Asteco QatarMain Office
Asteco QatarInvestor Desk
DOHA
UNITED ARABEMIRATES
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