Booming Bahrain real estate sector worth $5.7bn

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BOOM TIME: Bahrain's property market is predicted to grow rapidly until 2012. (Getty Images)

Strong local demand, high liquidity and relaxed foreign ownership rules are driving a booming real estate market in Bahrain now worth $5.7 billion, a new report said on Monday.

Research from global real estate broker DTZ, which has been doing business in the Middle East since 1975, predicted Bahrain’s property market would grow rapidly until 2012 across both residential and commercial sectors, making it ripe for foreign investment.

Robert Addison, DTZ’s country manager of Bahrain, said: “The Bahrain residential market still represents an excellent opportunity for investors.

"With a number of high-end mega-projects currently in development, those looking to buy a luxury property can still do so in Bahrain at a fraction of the price currently being recorded in other markets such as the UAE.”

The report identified a large supply of commercial property in the medium term, with one million sq m of office space planned by 2012, a 100 percent increase on the 500,000 sq m currently available.

Office rents, driven by demand from financial services firms, are also set to rise until 2011, until large developments are completed, the report said.

However, DTZ warned of an over-supply to Bahrain’s retail property market such as shops, and larger shopping malls.

”As new schemes enter the market, competition will intensify to attract consumers. We predict that older malls, and those which are not best configured to appeal to retail customers, will find it increasingly difficult to occupy units and command prime rents,” Addison added.

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