The $13.6 billion (AED 50 billion) economic stimulus package announced for Abu Dhabi earlier this year will help the emirate’s real estate sector by reducing costs for developers and promoting partnerships between the public and private sectors, according to a new report from consultants JLL.
The Abu Dhabi plan – which was announced by Sheikh Mohamed, Crown Prince of Abu Dhabi, in June - includes 10 economic initiatives designed to cover infrastructure and legislative projects and SMEs, as well as industrial and social projects and the real estate sector.
“The new government economic stimulus package has positive implications for the capital with new initiatives directly impacting the real estate market and as with previous government stimuli should lead to an upswing in investment,” said Peter Stebbings, JLL’s national director and head of Abu Dhabi.
“There has been an increased focus on promoting and implementing public-private partnerships across the region and within the UAE in particular,” he added. “With the stimulus package being introduced in Abu Dhabi, real estate developers will be able to reduce costs, paving the way for positive sentiment across the market.”
Additionally, while the JLL report found that residential rents and sales prices remained largely unchanged in Abu Dhabi in Q2, the UAE’s recent decision to allow 10-year visas for expats and 100 percent foreign ownership in companies outside of free zones will boost sentiment in the residential market by giving expats more security over their rights to remain in the UAE.
The report also found that office rents fell slightly over Q2 due to company consolidations or downsizing.
The emirate’s hospitality market, however, registered a 2 percent increase in occupancy levels and a 7 percent decrease in average daily rates, leading to a 4 percent decline in RevPar over the course of the first five months of the year compared to the same time period 2017.For all the latest real estate news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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