Bahrain’s apartment rental market will continue to be under pressure in the short term, property experts Cluttons said on Tuesday.
“Due to a supply-demand imbalance, we believe rental rates for all stock will be under pressure in the short term as landlords seek to generate a return on their assets which have also suffered declines in capital values,” Afshan Shah, of the firm’s Bahrain Strategic Consultancy team said.
Some areas in Bahrain, namely the Seef/Sanabis and Juffair, have seen rents increase as tenants move into new apartment blocks, but this has driven prices down elsewhere, Shah said.
He said: “Supply in particular will have to be carefully regulated in order to allow for some growth in market transactions.”
Cluttons, in its Bahrain Property Market Update report released on Tuesday, said the kingdoBahrain m’s industrial sector was strong and set to see further growth, especially in the logistics and warehousing sectors.
However, the report said the freehold office market had “all but dried up” with many projects on hold or their use changed for a greater return on investment.
Tim Glover, CEO Bahrain, said some opportunities did exist for developers committed to freehold office schemes.
“Cluttons sees an opportunity for developers who are committed to freehold office schemes, to lease individual floors and dispose of them as income producing investments; given the reduced lot size, this would increase liquidity and open up the commercial real estate market to a greater number of investors,” he said.
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