(MENAFN- The Peninsula)
The Peninsula
Doha: KPMG recently released its Qatar Real Estate Rental Index Q1 2016 – Q2 2021, which tracks quarterly changes in the real estate rental market covering three core asset categories: KPMG Office Rental Index (K-ORI), KPMG Residential Rental Index (K-RRI) and KPMG Mall Rental Index (K-MRI).
Anurag Gupta, Director and Head of Strategy and Real Estate Advisory at KPMG in Qatar said:“The steep fall in monthly rentals post-pandemic compelled landlords/developers to re-think their strategies. Landlords maintain high rental returns during stable demand; however, it is also necessary to adjust with the low-demand scenario when required. Those landlords willing to adjust are witnessing increased traction in leasing activity with subsequent demand for their properties.
Q1 and Q2 2021 experienced a shift in the momentum with monthly rentals experiencing a relatively softer decline. This could be attributed to landlords offering value for money products along with other external factors such as Government efforts in widespread vaccination, expected relaxation in employment related restrictions, and gradual improvement in the overall economic activity," he added.
Research showed the Office rentals in the central business district are witnessing promising signs of stability. With the uptick in the economic activity, KPMG expects a possible recovery over the short to middle term. After witnessing a drop of 8.4 percent during the last two quarters (Q3 and Q4) of 2020, the rentals for the commercial office segment have experienced significant improvement with just a one percent decline on the rental index during Q1 and Q2 2021.
On the Organized Retail Mall front, changing the momentum experienced over the last year, Q1 and Q2 2021 registered improved leasing activity with several new and existing brands occupying organized retail spaces in the leading malls across Qatar. The organized retail mall segment registered a relatively softer decline on the rental index by 2.9 percent compared to the material drop of 9.6 percent experienced primarily due to the onset of the pandemic during Q3 and Q4 2020.
Sayantan Pande, Associate Director and Head of Infrastructure, Financing and Real Estate Valuations at KPMG Qatar said:“We are of the belief that Qatar's Real Estate sector will sustain positive momentum in the second half of 2021. This is due to the successful COVID-19 vaccination efforts coupled with continuous measures from Government to support the economy.
We have started experiencing increased interest from large regional developers in the Qatar market, reconfirming our view that the market remains attractive and will return to normal soon," he added.
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