Quotes: MENA   Enter Symbol: NewsLetter: Search: advanced

Saudi - Resource constraints hinder project delivery despite continued demand  Join our daily free Newsletter

MENAFN - Arab News - 10/12/2013
No. of Ratings : 0
Add to Mixx!

(MENAFN - Arab News) Jones Lang LaSalle, a major global real estate investment and advisory firm, has released its Q3 2013 Market Overviews of the Riyadh and Jeddah real estate markets that assess the latest trends in the office, residential, retail and hotel sectors of the market in Saudi Arabia's two largest cities.
Commenting on the reports, Alan Robertson, CEO of Jones Lang LaSalle in MENA, said: "Real GDP growth is forecast to be 4 percent in Saudi Arabia for 2013, and Saudi banks are increasing their lending to real estate end-users to the highest level recorded during the last five years. While major new capital projects are driving strong demand across the office, retail and hotel sectors in Riyadh and Jeddah, labor shortages will likely delay projects and increase construction costs."

The Arriyadh Development Authority (ADA) announced further details of the proposed Riyadh Metro, which will consist of 6 lines with 96 stations and a total length of 176 km. Construction is scheduled to commence in Q1, 2014, with the first phase of the project opening in Q4, 2016. A total of SR3 billion has been allocated to acquire additional land, although the acquisition of land will be kept to a minimum.
The average quoted office rents for completed Grade A & B buildings has declined marginally to SR1,059 per sq m pa at the end of Q3, due to higher vacancies within B grade buildings in the CBD and to the South of Riyadh. Demand for office space remains strong, with considerable take up over the past six months. However, the combination of vacant space in new buildings and space being marketed in buildings currently under construction is providing tenants with wider choice and is resulting in more competition between owners to attract new tenants.
In the residential market, apartment and villa rents are expected to increase further in 2013. The average purchase price of apartments has decreased by 10 percent to SR2,534 per sq m over the past six months (excluding branded apartments), reflecting the fact that most apartments available for sale are located in the low income areas of Zahahrat Laban and Araija in the west, and Shifa, Badr and Suwaidi in the south. Average villa prices have increased by 4 percent compared to the same quarter last year to SR4,274 per sq m. Of the total future supply for the residential sector, some 6,000 units are expected to be delivered in expatriat residential compounds.

Average retail rents have increased slightly in super regional malls, while remaining largely unchanged in regional and community malls during Q3, 2013. Total mall-based retail supply is expected to reach around 1.7 million sq m by the end of 2016, with supply of retail malls expected to increase substantially. JLL anticipates limited rent increases in regional and community shopping malls given the availability of space and continued downward pressure on rentals in poorer performing malls.
The hotel market is showing signs of stability, following a period of declining performance as arrivals failed to keep pace with the significant increase in supply recorded in 2011 and 2012. There is a significant completions forecast for hotels rooms in 2014 and beyond, including the Hyatt Regency and Fairmont Business Gate.

Average office rents for both Grade A and B office space have increased significantly over the past six months. Vacancy levels decreased from 12 percent last quarter to 10 percent in Q3, reflecting the healthy demand from the government and private sectors.
In the residential market, the average asking price for apartments has decreased over Q2 and Q3 to SR3,800 per sq m. The average sale price of villas in locations monitored by JLL has decreased by 4 percent to SR4,400 per sq m over the past six months, driven by falling prices in the prime western districts of Jeddah. Limited availability of villas for rent has contributed to the growth in rentals.
The retail market rents remain consistent with Q3, 2012. Average rental for line stores in major malls is expected to remain stable, although the market may become more fragmented with not all centers able to maintain current rental levels. No further additions to retail supply are expected in 2013. Many retailers are planning expansions and opening new outlets and new brands continue to enter Jeddah's retail market.
Jeddah continues to be one of the best performing hotel markets in the Middle East in terms of occupancy during 2013. While occupancy levels have been increasing since 2010, they are now stabilizing, with Q3 2013 recording a slightly lower occupancy level of 78 percent compared to Q3 2012 (81 percent). Jeddah's continued strong performance is a reflection of both continued demand from religious pilgrims and its popularity as a leisure destination among Saudi families.


Arab News

  MENA News Headlines
 Oct 28 2016 - Egypt, Poland 2016 trade exchange to reach USD600mnMENAFN
(MENAFN) The volume of trade between Egypt and Poland is predicted to reach USD600mn by the end of this year.Furthermore, trade exchange increased by 3 percent to surpass more than USD350mn amid the ...

 Oct 28 2016 - UAE, Oman ink transport agreementMENAFN
(MENAFN) The UAE and Oman signed an international road transport of passengers and goods deal.Moreover, the deal aims to enhance cooperation in this field for the benefit of the two fraternal peoples ...

 Oct 28 2016 - Viva Kuwait Q3 revenue down by 14pctMENAFN
(MENAFN) Viva Kuwait recorded a 14 percent decline in Q3 net profit, as the impact of lower oil prices on the Kuwaiti economy dragged on revenue generation.Moreover, the Saudi Telecom Co. subsidiary ...

 Oct 28 2016 - Qatar- Labour Minister elected Chairman of ALO boardGulf Times
(MENAFN - Gulf Times) The 85th session of the Arab Labour Organisation (ALO), which began its meetings in Doha yesterday, has elected HE the Minister of Administrative Development, Labour and Social ...

 Oct 28 2016 - Qatar- PM meets ALO officialGulf Times
(MENAFN - Gulf Times) HE the Prime Minister and Minister of Interior Sheikh Abdullah bin Nasser bin Khalifa al-Thani met a senior Arab Labour Organisation (ALO) official who is currently visiting ...

 Oct 28 2016 - Qatar- Host of activities at 'Family Fun Fridays' todayGulf Times
(MENAFN - Gulf Times) The ‘Family Fun Fridays"; series continues today at The Pearl-Qatar. Organised by United Development Company (UDC), master developer of The Pearl-Qatar, today";s ...

 Oct 28 2016 - Bangladesh envoy hosts Asian ambassadors' dinnerGulf Times
(MENAFN - Gulf Times) Bangladesh";s ambassador to Qatar, Ashud Ahmed, and his wife recently hosted an Asian Ambassadors"; Group Dinner in Doha. The event was attended by the ambassadors of different ...

 Oct 28 2016 - Apple Fest begins at LuLu outletsGulf Times
(MENAFN - Gulf Times) The Apple Fest was launched at all LuLu Hypermarket outlets in Qatar yesterday. The week-long festival features more than 20 varieties of apple from Spain, France, Italy, New ...

 Oct 28 2016 - Qatar- 28 trucks seized in crackdownGulf Times
(MENAFN - Gulf Times) In a crackdown on overloaded and uncovered trucks, Al Khor and Al Thakhira Municipality has seized 28 such vehicles from the Umm Al Baraka area, the Ministry of Municipality and ...

 Oct 28 2016 - Qatar National Day Barwa Sports Championship setGulf Times
(MENAFN - Gulf Times) The Barwa Group, in association with the Qatar National Day Celebrations Associated Activities Organising Committee, will hold sports competitions at the Barwa Workers ...





Middle East North Africa - Financial Network

MENAFN News Market Data Countries Tools Section  

Middle East North Africa - Financial Network

Main News
News By Industry
News By Country

Search News
Market Indices
Quotes & Charts

Global Indices
Arab Indices


Oil & Energy

Currencies Cross Rates
Currencies Updates
Currency Converter

USA Stocks
Arab Stocks

Saudi Arabia 

Economic Calendar
Financial Glossary

Financial Calculators

RSS Feeds [XML]

Corporate Monitor


Real Estate
Submit Your Property

Arab Research
Buy a Research

Press Releases
Submit your PR

Join Newsletters

© 2014 menafn.com All Rights Reserved.  Terms of Service | Privacy Policy | Contact Us | Advertise | About MENAFN | Career Opportunities | Feedback | Help