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Tue 7 Oct 2008 12:56 PM

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Mideast real estate to outperform rest of world

Investors believe regional property markets to withstand global slowdown - survey.

Middle East real estate markets will outperform all other regions over the next couple of years, with the UAE and Saudi Arabia leading the charge, according to a survey of investor sentiment released on Tuesday.

The survey by real estate consultancy Jones Lang LaSalle found more than 50 percent of respondents believe real estate markets in the region will see the strongest growth worldwide in the next 1-2 years, followed by the Asia Pacific.

The survey found almost 50 percent believe the UAE, and in particular Abu Dhabi, will be the best performing market in the region, with a quarter of respondents stating Saudi would be the best performer.

Jones Lang LaSalle said the opinions of more than 350 developers, sovereign wealth funds and high net worth investors were canvassed for the survey.

"The Gulf Region offers strong relative international value with active buyers in the region generally looking to transact at 8-8.5 percent yields for prime commercial operating assets and slightly higher for hospitality product," said Ian Ohan, head of investment transactions for the Middle East and North Africa (MENA) at Jones Lang LaSalle.

"Investors are looking for strong capital growth in Abu Dhabi, the kingdom of Saudi Arabia and Qatar, reflecting their robust economic potential and more nascent stages in the real estate cycle."

Investors feel the Middle East will be one of the regions least affected by current global economic slowdown and that the economic climate is providing opportunities abroad for regional investors, according to the survey.

Less than 20 percent of investors feel the slowdown is having a significant impact on real estate markets in the Middle East, the survey revealed.

The survey found almost half the respondents (45%) think Middle Eastern investors stand to benefit the most through their ability to export capital.

It also found over 40 percent of investors think the slowdown is having little or no impact on their approach towards real estate investment in the Middle East.

On the severity of the slowdown, over 60 percent of investors are optimistic global capital markets will either remain the same or improve over the next 1–2 years, according to the survey.

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SR 11 years ago

This is unbelievable!!! Contradictions in these surveys & reports are alarming!!! For one can we believe this survey? Looking at how the stock market is moving, most investors seem to think otherwise! Moreover, if everybody in confident of the fundementals, why bother with all this hype?? It is interesting to know the profile of the population that was surveyed, looking at the result, I think it mostly included developers / investors who have already invested!

paresh 11 years ago

THis is a survey on the " feelings" of vested groups on the property market in Gulf countries. What would you expect them to say.? Immunity from a global slowdown on world economy would be the best news but this has yet be seen.

Babar 11 years ago

It does not matter whether the investor thinks the market may do well or not. It is their opinion based on sentiments rather than market analysis. Their sentiments should not be taken as a benchmark by other novice investors. Future investors should rely more on a factual-based analysis by independent market gurus to safeguard their investments.