REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 2016

Transcription

1 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 216

2 FOREWORD ADIB Real Estate Services comprises a comprehensive real estate banking and advisory platform providing the full range of professional services from a single provider. Our services include:- Real estate financing Strategic development advisory Investment advisory Asset management Project management Valuation Agency Market research Property management Facilities management Residential During the course of 216, c.15, new units (apartments/villas/townhouses) entered the market taking the total residential stock of Dubai to over 496, units, an increase by 3.1% year-on-year. Despite the challenging economic environment, the off-plan market remained buoyant with a cumulative launch of over 18, units (apartments, villas and townhouses) spread across multiple masterplan developments. Attractive payment plans and competitive pricing strategies were the driving force towards attracting end users/investors. Residential apartment sales rates dropped by 5% year-on-year while the villa sale rates recorded a 4% decline year-on-year. Despite the challenging economic environment and rising stock, the residential sector performed better than expected, with average apartment rents dropping by 4% year-on-year. Landlords have been very flexible in accepting multiple payment term options and continue to offer incentives which are assisting in holding the rental values from dropping further. Office Dubai office stock reached 94 million sq.ft. with an addition of c.3.5 million sq.ft. during 216, an increase of 4% year-on-year. Despite the substantial increase in stock, larger occupiers continue to struggle in finding suitable office space across consecutive floors in single owned buildings. Q4, 215, an increase of 65% year-on-year. However, the substantial rise in transaction value was primarily due to transaction of Building 2 & 4 of Emaar Business Park at a cumulative value of AED 385 million. Average office rents across Dubai have dropped by 3% during the quarter and 6% year-on-year, as certain landlords of ageing properties and strata space, vacant for over 3 months, are offering space below the prevailing market rates. Retail During the quarter, c.21, sq.ft. GLA (gross leasable area) was added to Dubai s shopping mall / centre space stock, taking the total stock to 34.4 million sq.ft. This represents a.6% addition during the quarter and an increase of 5% year-on-year. Rental rates remained stable during the quarter, however taking into consideration challenging economic conditions, weakening sales of luxury products and rise in supply, we expect rental rates to be under pressure during the course of 217. Hotel During the last quarter of 216, over 2,3 rooms were added across 1 properties taking the total supply to over 13, rooms and apartments. Dubai s hospitality sector continues to perform well, compared globally on average occupancy levels and ADR rates, with hoteliers being increasingly pressured to sustain regional yield values. During the quarter, AED888.7 million worth of office space transacted as compared to AED million in 2

3 MPM PROPERTIES FACTS AND FIGURES TOTAL UAE STAFF PROPERTY MANAGEMENT STAFF ADVISORY STAFF 35+ LEASING & SALES STAFF No.1 LARGEST ABU DHABI MAINLAND PORTFOLIO 1,7 LANDLORD CLIENTS 23,5+ UNITS UNDER MANAGEMENT 2+ DEDICATED VALUATION PROFESSIONALS 98.5% OCCUPANCY RATE 9bn COMBINED MARKET VALUE OF PROPERTIES VALUED SINCE JANUARY 212 7,6+ MORTGAGE VALUATIONS SINCE JANUARY 212 CONTENTS Year in Review 4 Macro & Micro Outlook 6 Potential UAE Scenarios 8 Demand Drivers 1 Macro Trends 12 Residential Sector 14 Project Focus 22 Office Sector 24 Retail Sector 28 Hospitality Sector 3 Definitions & Methodology 32 Contact Information 33 Supply - Photo Gallery 34 Development Location Map 36 3

4 216 YEAR IN REVIEW REAL ESTATE SERVICES MPM ABU DHABI & DUBAI OUTLOOK 216 YEAR IN REVIEW - DUBAI What went right Residential sector yields improved, reviving investor interest Strong take up of affordable properties valued below AED8k Over 95% occupancies for office space across major freezones Dubai hotel RevPar performed well in comparison to competing International markets MARKET PERFORMANCE What went wrong Residential properties which had seen the highest appreciation since 214 saw a drastic reduction in sale volumes High volume of strata coming to the market being absorbed at a slow pace Declining office sales and rental rates by 5% year-on-year Overall pessimistic market sentiment leading to 16% y-o-y drop in real estate transaction volumes Hotel guests have grown by 3.9% YTD 216 New tourist attractions like theme parks and the Opera House lengthening average duration of stay Chinese tourists allowed visa on arrival TOURISM Hotel room supply grew faster than tourist arrivals during the year Dollar appreciation impacting Dubai's competitive edge as a tourist destination for Asian and Russian budget tourists Non-oil trade for Jan-Sept 216 valued at AED 952 billion (1%+). Exports and re-exports representing a 38% share New Industrial Strategy expected to increase exports by AED16 billion and add 27k jobs by 23 Launch of Dubai Wholesale City, to be home to over 15, traders TRADE Low oil prices leading to job losses in the Oil & gas support industries Higher borrowing cost for SME UAE losing 4 ranks on the Getting Credit, a measuring tool for Doing Business Report from the World Bank Implementation of bankruptcy law to encourage investor confidence in UAE Improved control from RERA on property listing and marketing by agents LEGAL Dubai Canal opened during Q4 Metro Red-line expansion contract awarded Al Houdh Interchange between Mohammed Bin Zayed Road and Al Yalayis Road opened INFRASTRUCTURE 4

5 REAL ESTATE SERVICES MPM ABU DHABI & DUBAI OUTLOOK 216 YEAR IN REVIEW 216 YEAR IN REVIEW - ABU DHABI What went right Prime Residential units holding their rents Increasing vacancy leading to reduction in residential rents, helping middle income residents Successful launch of off-plan villa projects Retailers increasing high street presence, enhancing street retail appeal MARKET PERFORMANCE What went wrong Redundancies in key economic sectors affecting Residential, Retail and Office demand Unlike Dubai, Abu Dhabi developers have not reacted to the change in residential demand by offering a diverse range of affordable housing options. Shopping mall revenue spend has reduced, in turn impacting retail rents Hotel RevPar dropped during the year Increase in total number of hotel guests by 8% YTD 216 Number of hotel guest nights increased marginally Abu Dhabi has seen cruise liner tourism increase by 1+% from 215. Abu Dhabi has continued to proceed with 22 plan of creating a diverse selection of tourist offering with example of progressed developments of Yas Island and theme parks TOURISM Total hotel revenue declined by 9% YTD 216, marginal decline of 3% in occupancy Hotel rates and demand affected by strong dollar and weakening of currency in the UK and Russia, few of the major sources of visitor footfall to Abu Dhabi. Abu Dhabi witnessed 1+% increase in cruise liner tourism Announcement of Seaworld Theme Park Agreement reached late in 216 on oil supply curbs between OPEC & Russia Improved efficiency and cost management in the government sector due to key mergers and executive appointments in government entities. TRADE Sustained low levels of oil prices due to supply glut Business lending rates up UAE losing 4 ranks on the Getting Credit, a measuring tool for Doing Business Report from the World Bank. Implementation of Abu Dhabi s new real estate law (No. 3 of 215) will increase buyer and investor confidence in the real estate market Implementation of UAE bankruptcy law to allow SME's, an opportunity to restructure Implementation of 5% cap on apartmentrentals to aid tenant negotiations LEGAL Madinat Zayed business district project awarded Infrastructure projects worth AED544Mn within Abu Dhabi awarded to build new roads, schools and local infrastructure INFRASTRUCTURE Abu Dhabi metro and light rail project delayed further 5

6 216 YEAR IN REVIEW REAL ESTATE SERVICES MPM ABU DHABI & DUBAI OUTLOOK DUBAI 217 MACRO & MICRO OUTLOOK OPPORTUNITIES Continued Government spending towards infrastructure and social development to generate new employment opportunities. Apartments, townhouses and villas in the affordable category show strong growth from investors and end users alike Continued demand for bespoke Grade "A" office space from large corporate occupiers Community / neighbourhood retail centre developments within masterplan communities. Hotel developments catering to changing customer demands of experience over traditional brand appeal SME sector looking for single held strata space to lease mid to large sized offices (25-1,sq.m.) CHALLENGES Fluctuating oil price and challenging economic environment. Luxury and high end residential properties anticipated to record further decline in capital values. Office vacancy rates to remain elevated as supply outpaces demand. Ageing and strata office buildings to face the maximum brunt. Mid-market retail spending likely to remain subdued as consumers remain wary of economic landscape. Key hotel performance indicators to decline further, due to strong dollar and pipeline supply. 6

7 REAL ESTATE SERVICES MPM ABU DHABI & DUBAI OUTLOOK 216 YEAR IN REVIEW ABU DHABI 217 MACRO & MICRO OUTLOOK OPPORTUNITIES Affordable housing units along with smaller configuration units (Studios and 1 Bedrooms) continue to be in demand with investors and end users. Outlook for oil remains positive, which will lead to increased Government spending, which will lead to opportunities for SME s Opportunity to create water facing F&B destination hubs Upcoming museums and theme parks to increase Abu Dhabi's visitor arrivals, subsequently enhancing opportunities for real estate investors around these anchors Develop facilities (leisure and entertainment) catering to mid-market customers and tourists Opportunity to build themed mid-market office business parks with adequate parking CHALLENGES Retail and F&B sector to remain challenged due to increase in supply and consumer sentiment Hotel rates likely to remain stagnant or fall marginally as dollar continues to remain strong Weakened currencies (vis-à-vis US $) in the UK and Russia will result in fewer tourist arrivals from these key markets. 7

8 216 YEAR IN REVIEW REAL ESTATE SERVICES MPM ABU DHABI & DUBAI OUTLOOK POTENTIAL UAE SCENARIOS: 217 Tourism from key markets like Russia, UK, India, etc. is likely to see a continued negative impact of the dollar strengthening. Weaker currencies such as Sterling and Euro offer significant investment opportunities for overseas investment Cost of importing goods would rise, in turn impacting the performance of consumer price index DOLLAR MOVEMENT Expected further rebalancing and recovery in the oil price will bolster confidence among individuals and smaller firms and will result in an increase in retail spending and recruitment. Infrastructure and tourism related projects to get a boost, if oil stays at acceptable levels for over 6 months. Improved sentiment will encourage real estate investors and end users to acquire assets OIL PRICE Consumer spending will continue to be focused on essentials and sales of non-essential categories, especially luxury goods will potentially be negatively impacted. Retail rents to be subdued Potential increase in savings to help reduction of expatriate debt INFLATION Reduce demand for borrowing across all segments in particular property and personal loans Existing borrowers on variable loans will have reduced discretionary income Potential for drop in liquidity as banks might be required to make higher provisions INTEREST RATES Positive impact on tourist arrivals, especially from south Asian countries. The relative strength of the dollar is impacting UAE real estate investment, with expatriate investors opting to avail of weaker foreign currencies, resulting in capital outflows from UAE. Drop in US$ will lead to higher inflow of capital into UAE Government and private sectors will be cautious, with capital investment, spending and recruitment to remain subdued Potential of delay in some of the infrastructure projects Lower foreign investor interest / confidence in UAE Potential introduction of fiscal measures that could impact cost of living Consumer spending in non-essential segments will pick up, subject to other positive cues from the larger macro-economic environment. Increased consumer spending to aid trade and economic growth Potential increase in demand for funds, which can drive growth especially in the SME segment. Spur residential sales demand from end users and investors. 8

9 REAL ESTATE SERVICES MPM ABU DHABI & DUBAI OUTLOOK 216 YEAR IN REVIEW POTENTIAL UAE SCENARIOS: 217 Greater availability of funds leading to greater opportunity for savvy real estate investors Better credit card and personal loan offerings to drive consumer spending General confidence in economy would rise BANK LIQUIDITY Higher yields to attract local and foreign investors in the market Potential for REIT's and real estate funds to be structured on the back of healthy returns Higher rents to drive tenants to become owners RENTS MOVEMENT Potential of negative impact on investor returns, which could reduce real estate investments Increases cost of living, but assists Government in meeting their fiscal budget requirements GOVERNMENT REAL ESTATE FEES Will result in increased occupancy levels and may see some hotels increase rates H2 217 onwards. Higher retail spending will aid retail sector TOURIST ARRIVALS Lack of available funds to impact corporate growth Borrowings against riskier assets to be curtailed / significantly reduced Banks restricted to fund "high earning" projects Cost of living and business operating cost to be lower Reduced interest from local and foreign investors as they focus on alternative investments Commercial tenants will look to move to better quality developments Demand for additional midmarket housing will drop Would be welcomed by investors and end users. May spur purchase decisions among on-the-line prospective home buyers. Lower arrivals will bring hotel ADR's down, in turn making Dubai a competitive tourist market for Asians and Russians. 9

10 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW DEMAND DRIVERS GOVERNMENT INITIATIVES The UAE s Federal National Council has set the Federal budget for 217 at AED 48.7 billion, marginally higher than the 216 budget of AED 48.5 billion. 42% of the budget is allocated to government affairs followed by 2.5% for the education sector, 8.6% for the healthcare sector, 8.2% for public sector wages, 6.6% to social development, 3.3% towards housing and 4% for Innovation. His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, approved Dubai s budget of AED 46.1 billion, 2.6% increase over last year, for the fiscal year 217. Highest budget allocation of 34% was given to social development which includes health, education, housing and community development. Infrastructure received the biggest boost with an allocation of 17%, an increase to 27% from the previous year. In term of revenues, the biggest share, representing 76% of the total revenue is expected to come from government fees followed by 16% from customs and tax, 6% from oil and 2% from government investment returns. Overall, the 217 budget has a deficit of AED 2.5 billion. His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai issued a decree to establish The Mohammed bin Rashid Library at a cost of AED 1 billion. The seven storey book shaped structure covers over 92, sq.m. area and is located in Al Jaddaf area of Dubai. The library will hold more than 1.5 million volumes, 1 million audio books and 2 million e-books, making it the world s largest electronic collection and the biggest library in the Arab World. REAL ESTATE AND CONSTRUCTION Construction work on phase 2 of the Dubai Design District (d3) has been announced at an estimated cost of AED1 billion. Phase 2 of the project includes construction of a creative community comprising of workshops, showrooms, design studios and exhibition space. The project is expected to be completed in 219. His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai launched construction work on The Tower at Dubai Creek Harbour development. The 928 metres tall tower is estimated to cost AED3.67 billion and is expected to be completed by 22. The Tower will include an oval-shaped bud that will house ten observation decks, including the Pinnacle Room, which will offer 36-degree views of the city. Dubai Investments launched Mirdif Hills, an AED 3 billion mixed use project located adjacent to Mushrif Park, spread over 3.9 million sq.ft. area offering 1,54 residential units comprising of studio, one, two, three bedroom apartments and duplex units, a 4 star hotel with 116 keys, 128 serviced apartments and a 23 bed hospital. Q4 216 KEY EVENTS 1 WETEX, 4th 6th October, 216. GITEX Technology Week, 16th 2th October, 216. Gulfood Manufacturing, 7th 9th November 216 The Big 5, 21st 24th November 216 The Indian Property Show, 8th 1th December 216 Paper Arabia, 13th 15th December 216

11 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 216 FREEZONES Mettler Toledo, the world s largest manufacturer and marketer of weighing instruments for use in laboratory, industrial and food retailing applications opened a new Competence Centre occupying a 2 sq.m. area in Dubai Science Park. Through its centre the company aims to serve petrochemical, food and pharmaceutical industries in the MENA region by providing technical support on optimizing lab processes and cost efficiencies. Picket Asset Management, a subsidiary of the Picket Group opened its offices in the Dubai International Finance Centre (DIFC). The Picket Group headquartered in Geneva, has a global presence with 26 representative offices, subsidiaries and branches around the world. Jebel Ali Freezone (JAFZA) grew 14% year-on-year in the number of companies registered under the building and construction sector category as of end H The freezone is currently home to over 961 companies under the building and construction sector including prominent names such as Arcelor Mittal, Tata Steel, China National Building Group, Hitachi Construction Machinery. TRANSPORTATION The Roads and Transport Authority of Dubai opened the Al Houdh Interchange, located between Mohammed bin Zayed Road and Al Yalayis Road (E311) at a cost of AED228 million. During the quarter, the Roads and Transport Authority opened the AED15 million bridge linking Deira Islands with mainland Dubai. The bridge provides direct access to the Palm Deira project which comprises of four islands spread over c.17 million sq.m. of land area. The project is linked via three entrances, two at the intersection of Al Khaleej Road and Al Quds Road, and the third from Al Mina Road. Dubai International Airport handled 7.7 million passengers in December 216, up by 9.3% compared to 7.5 million passengers in December 215. The passenger traffic recorded a 7.2% increase year-on-year, with 83.6 million passengers using the Dubai International Airport in 216, up from 78.1 million passengers in 215. TOURISM INITIATIVES His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai announced AED1.3 billion development plan for Hatta. The development plan includes housing units for Emiratis, winter sports facilities and mountain track circuit. Key areas of focus are economy and services, tourism and sport, and education and culture. On completion, the project is expected to create employment opportunities for more than 2, individuals along with 2 permanent administrative and technical jobs. Figures from the Department of Tourism and Commerce Marketing (Dubai Tourism) indicate a 3.9% rise in visitors to Dubai YTD November 216 versus the same period the year before. Dubai welcomed million overnight visitors during YTD November 216 with 24% of the visitors originating from GCC countries, 21% from Western European countries and 17% from South Asia. Top source markets are, India with 1.58 million visitors followed by Saudi Arabia with 1.52 million visitors and the United Kingdom remained third with 1.1 million visitors. Schon Properties launched isuites hotel apartments in Dubai Investments Park with a total value of AED3.2 billion. The development comprises of 21 mid-rise buildings offering 2,7 hotel apartments along with 125, sq.ft. of retail promenade. The project is expected to be delivered by 22. The developer will retain one third of the total units while the rest will be offered to the public. 11

12 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW MACRO TRENDS DUBAI GDP SHARE BREAKDOWN BY ECONOMIC SECTORS YTD 5% 6% 12% 29% 11% 15% 22% Source: Dubai Statistics Center and MPM Properties Research DUBAI POPULATION (GROWTH & HOUSEHOLD SIZE) POPULATION (MILLIONS) , ,95 2,3 2,16 2, ,327 2,445 2, GROWTH RATE (%PA) AND HOUSEHOLD SIZE Population Source: Dubai Statistics Center Growth Rate Household Size DUBAI CONSTRUCTION ACTIVITY %YoY DUBAI CPI VS RENTAL CONTRIBUTION TO CPI Q % 12. 2% 15% 1% %YoY 5% % 1. -5% -1% -15% -2% GDP Construction Source: Dubai Statistics Center e 8. JAN 12 JUN 12 JAN 13 JUN 13 JAN 14 JUN 14 JAN 15 JUN 15 JAN 16 JUN 16 DEC 16 Housing CPI Contribution to CPI Source: Dubai Statistics Center 12

13 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 216 INVESTOR ANALYSIS DUBAI LAND TRANSACTIONS VOLUME vs VALUE DUBAI LAND TRANSACTIONS QoQ% CHANGE Transactions 12, 1, 8, 6, 4, 2, 3, 25, 2, 15, 1, 5, Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q2 Q3 Q4 Q1Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3Q4 Q1 Q2 Q3Q Value (in Millions) Sales Value Sales Transactions * Established Real estate Source: DLD and MPM Properties Research Sales Transactions Source: DLD and MPM Properties Research TOP NATIONALITIES INVESTING IN DUBAI PROPERTY IN 216 Value (AED' Billions) Source: DLD UAE India Saudi Arabia United Kingdom Pakistan Iran Canada Jordan Egypt Kuwait TOP LOCATIONS - RESIDENTIAL TRANSACTION VALUE Transaction Value AED million Source: DLD Emirates Living Downtown Dubai Dubai Marina Jumeirah Beach Residence Q4 216 Q3 216 Palm Jumeirah Arabian Ranches Jumeirah Lakes Towers Dubai Sports City Jumeirah Village Business Bay 13

14 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW RESIDENTIAL SECTOR RESIDENTIAL SUPPLY During Q4 216, Dubai s residential stock expanded with an addition of over 4,5 new residential units (apartments and villas). The majority of new supply (65%) comprised of apartments and the rest being villas and townhouses. Overall during the course of 216, close to 15, new units entered the market taking the total residential stock of Dubai to over 496, units. Looking at the supply pipeline, it is forecasted that the Dubai residential sector would see an addition of c.16,5 new units (apartments/villas/ townhouses) during the course of 217. Over the past few years, the market has witnessed a substantial rise in the supply of townhouses and villas due to a shift in investor profile. Developers were quick to accommodate the changing investor appetite by increasing the ratio of independent villa and townhouse units within their developments. During 216, over 4, villas/townhouses were handed over to investors and looking at the off-plan launches and ongoing construction activity, we forecast the supply to remain in the range of 4,- 5, units annually over the next three years. The off-plan market remained buoyant during 216 despite the challenging economic environment. During Q4 216, c.6, off-plan units (apartments, villas and townhouses) were launched. Noticeable projects launched during the quarter include the Pulse in Dubai South with prices starting from AED28, for a studio. During 216, the off-plan market witnessed a cumulative launch of over 18, units (apartments, villas and townhouses) spread across multiple masterplan developments with handover expected in 219 and beyond. Looking at the ongoing construction activity and new project launches, we expected the residential stock of Dubai to rise by c.15, new units annually up to 22, provided developers stick to construction timelines as stated during the launch. RESIDENTIAL SUPPLY BY UNITS YoY 1.9% 3.1% 2.7% 1.3%.8%.9% 3.5% 3.7% H1 216 Q3 216 Q Existing Supply Apartments Supply Villas +% Change Source: MPM Properties Research 14

15 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 216 SAMPLE OF RESIDENTIAL UPCOMING PROJECTS LOCATION PROPERTY NAME Palm Jumeirah Viceroy Al Qusais Emirates Airlines Accommodation Dubai Studio City Glitz 1 Culture Village Dubai Wharf District One, Mohammed Biin Rashid City Sobha Meydan Villas Dubai Science Park Villa Lantana Dubai International City Warsan Village Arjan Syann Park SAMPLE OF ANNOUNCED PROJECTS IN Q4 216 NAME OF PROJECT TYPE DEVELOPER LOCATION Studio One Apartments Select Properties Dubai Marina The Pulse Apartments/ Townhouses Dubai South Dubai South Hayat Boulevard Apartments Nshama Town Square Park Point Apartments Emaar Dubai Hills Estate Miraclz Apartments Danube Arjan Aliyah Residence Serviced Apartments Azizi Dubai Health Care City The Address Residence Serviced Apartments Emaar Jumeirah Beach Residence Villanova Villa & Townhouses Dubai Properties The Villa Akoya Selfie Villa & Townhouses Damac Akoya Oxygen Kempinski Residences Furnished apartments Gemstone Business Bay Akoya Relax Villa & Townhouses Damac Akoya Oxygen Akoya Fresh Villa & Townhouses Damac Akoya Oxygen Noor Townhouses Townhouses Nshama Town Square Victory Residency Apartments CPL Real Estate Development LLC Al Furjan Murad Tower Apartments Al Barsha Emaar Azizi Farishta Apartments Azizi Al Furjan Akoya Manarola Villa Damac Akoya Oxygen Rahala Residences Furnished apartments Seven Tides Jebel Ali Mirdiff Hills Apartments & Villas Dubai Investments Real Estate Company Mirdif Azizi Star Serviced Apartments Azizi Al Furjan 15

16 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW RESIDENTIAL SECTOR APARTMENT SALE PRICES In Q4 216, a total of 2,849 apartments were transacted at a cumulative value of AED 3.56 billion, an increase of 14% year-on-year. Prime locations in Dubai Marina, Jumeirah Beach Residence and Downtown Dubai continue to dominate the transaction market. Together these three locations recorded sales transactions worth AED 1.9 billion, about 3% of the total apartment sales value for the quarter. Premium offerings, lifestyle and well developed facilities and amenities continue to attract seasoned investors and occupiers alike. Residential apartment sale rates during the quarter dropped marginally by 1.5% while yearon-year the drop was around 5%. However, the rate of drop varies from development to development. Among the selected locations highest drop of 9% was noticed in Old Town area with average sale rates dropping from AED 2,5 per sq.ft. in Q4 215 to an average of AED 1,875 per sq.ft. in Q4 216, while in Greens the decline was 8% year-on-year. This quarter has witnessed the launch of multiple projects from high-end residential to affordable properties, increasing the depth of the residential offering within Dubai. Few high-end projects include the Address Residence-Jumeriah Beach Residence and Kempinski Residences in Business Bay with average sale rates ranging from AED1,75 2,7 per sq.ft. while the affordable segment includes projects such as the Pulse in Dubai South, Mircalz in Arjan and Hayat Boulevard in Town Square with pricing ranging between AED67-AED1,5 per sq.ft. Despite attractive prices and payment terms, we have noticed a drop in absorption rates for off-plan properties as compared to first half of the year. Economic uncertainties and substantial offerings have led to a drop in transaction activity. APARTMENT AVERAGE SALES PRICES (Q4 216) AND PERCENTAGE CHANGE QoQ -2.3% -2.6%.% -3.1% -3.1%.%.%.% -2.5% YoY -7% -9% -3% -6% -3% -5% -4% -1% -8% AED/sq.ft. 2,5 2, 1,5 1, 5 Downtown Dubai Old Town DIFC Palm Jumeirah The Views 2,1 Dubai Marina 1,875 Business Bay Jumeirah Beach Residence The Greens 1,8 1,55 1,55 1,4 1, ,225 Source: MPM Properties Research 16

17 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 216 APARTMENT RENTS Despite the challenging economic environment and rising stock levels, the residential sector has performed better than expected, with average apartment rents dropping by 4% year-on-year. However, the decline remained fragmented, as the rise in supply and tenant migration resulted in areas such as Bur Dubai, Dubai Marina, Palm Jumeirah and Dubai Sports City recording an annual drop of over 5%. It is noted that the rental drop has been primarily due to downward movement of rents across smaller unit sizes of studios and one bedroom. During the course of 216, largest concentration of supply has been towards smaller sized units. Average rent for studios in Dubai Silicon Oasis ranged between AED 45, to 48, per unit per annum in Q4 215 compared to current rates of AED 4, to 45, per unit per annum, representing an average drop of over 5%. Close to 2, new units were added during 216 in Dubai Silicon Oasis with the largest concentration being for studios and one bedroom units which has resulted in substantial rental drop for smaller unit sizes. However, we are noticing that landlords have been very accommodative by accepting multiple payment term options and continue to offer incentives which are assisting in holding the rental values from dropping further. AVERAGE APARTMENT ANNUAL RENTS Q4 216 LOCATION STUDIO 1BR 2BR 3BR Q-ON-Q Y-ON-Y Business Bay % -3.41% DIFC % -4.15% Discovery Gardens %.2% Downtown Dubai % -.23% Dubai Marina % -5.41% Greens % -3.18% International City % -1.38% Jumeirah Beach Residence % -.98% Jumeirah Lakes Towers % -2.44% Palm Jumeirah % -4.88% Barsha Heights % -2.36% Source: MPM Properties Research 17

18 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW RESIDENTIAL SECTOR VILLA SALE PRICES During Q4 216, a total of 319 villas and townhouses transacted with a total value of AED 1.43 billion, compared to 279 transactions at a value of AED1.9 billion in Q On a year-on-year basis, villa transactions in value terms recorded a 6% increase. Prime villa masterplan developments of Emirates Living (Meadows, Springs, the Lakes and Emirates Hills) recorded the highest number of transactions in both value and volume terms recording a total of 123 transactions at a cumulative value of over AED 482 million followed by Palm Jumeirah with 24 transactions at a total value of AED311 million. Average villa sale rates across selected villa communities have witnessed a marginal drop of 1% quarter-on-quarter and 4% year-on-year. Within the selected locations, properties in the Jumeirah Village area recorded the highest drop of 9% yearon-year followed by 6% drop in Jumeirah Park area. The compression in sales rate is primarily due to launch of similar offerings at affordable rates in close proximity to these developments. During the quarter, c.1,5 villas and townhouses were launched across multiple developments. Pricing and payment structure remain the key selling proposition for these properties. Majority of the units launched during the quarter were priced in the range of AED 1. to 1.5 million per unit with 5% and above payment of the purchase value scheduled on handover or months post-handover. AVERAGE VILLA SALE PRICE AED/ sq.ft. Q4 216 QoQ -2.% -2.%.%.%.%.% -3.%.% YoY -5.% -4.% -5.% -5.% -6.% -5.% -9.% +5% 2,5 AED/sq.ft 2, 1,5 1, 5 2,45 1,3 1,15 1,125 1,1 1, , Palm Jumeirah The Lakes Dubai Sports City Arabian Ranches Source: MPM Properties Research Jumeirah Park Springs & Meadows Jumeirah Village Al Furjan 18

19 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 216 VILLA RENTS Average villa rents dropped by 2% quarteron-quarter and 4% year-on-year. The decline has been primarily linked to rise in new supply and migration of tenants to economical units. During 216, over 4, new villas/ townhouses were added to the market which led to a drop in rental rates. The rental decline varied by location and unit size. In terms of villa size, the highest drop was recorded for four and five bedroom units which saw rents dropping by 7% and 6% respectively. During 216, over 1,5 villa/townhouse units were handed over across the broader Arabian Ranches development which has resulted in average rental deflation of 5% year-on-year. Rental rate for a four bedroom villa in Q4 216 ranged between AED 22,-27, per unit per annum compared to AED23,-29, per unit per annum in Q With a further 1, units expected to be handed over during 217, we expect the rental rates in the development to remain under stress during 217. During the quarter, townhouses in freehold areas have performed relatively better than the mainland areas. Tenant preferences were more towards new supply emerging from established locations of Arabian Ranches and Mudon which offer properties of varied sizes/layouts and are complimented by welldeveloped community facilities. AVERAGE VILLA ANNUAL RENTS Q4 216 PROJECT 2 BEDROOM 3 BEDROOM 4 BEDROOM 5 BEDROOM Q.O.Q Y.O.Y Al Furjan % -1.52% Arabian Ranches % -4.97% Dubai Sports City % -2.3% Jumeirah Park % -2.98% Jumeirah Village % -2.4% Meadows % -4.4% Palm Jumeirah % -6.18% Springs % -2.82% Jumeirah Islands % -5.77% Jumeirah Golf Estates % -5.82% Source: MPM Properties Research 19

20 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW INVESTMENT VILLA VALUES Q AED (Million) Mirdif Al Barsha Umm Suqeim Al Warqa Low High Average Source: MPM Properties Research NON-INVESTMENT VILLA RENTS Q4 216 AED (Million) Mirdif Al Barsha Umm Suqeim Al Warqa 4 Bed 3 Bed 5 Bed Source: MPM Properties Research NON-INVESTMENT LAND VALUES Q , AED / Sq.ft Mirdif Al Barsha Umm Suqeim Al Warqa Low High Average Source: MPM Properties Research 2

21 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 Q

22 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEWQ2 215 VINCITORE PALACIO Vincitore Palacio, a residential development located in the heart of New Dubai at Arjan (Al Barsha South 3) is being developed and marketed by Vincitore Real Estate Development LLC. It is a ground plus four storeys freehold property offering a total of 175 residential units comprising of a mix of spacious studios, elegant one bedroom and ensuite two bedroom apartments. The project is easily accessible via key road network of Sheikh Mohammed bin Zayed road and Umm Suqeium road. It is ideally located in close proximity to retail and leisure facilities such as Dubai Sports City, Miracle Garden, Global Village and City Centre Me aisem. The project is currently under construction and is scheduled for completion by August 217. AMENITIES AND FACILITIES Sophisticated Double Heighted Designer Lobby Built in kitchen Immaculately designed Ornamental Façade Built in wardrobe Designer Elevators 6 foot long temperature controlled swimming pool 3+ sq. ft. sunlit gymnasium with steam & sauna Fully fitted bathroom with meticulously selected accessories Water fountain 24*7 secured access with video intercom Sun-deck with each apartment Quality Control by TUV Nord, Germany (ME) UNIT TYPE UNITS NET AREA (SQ.FT.) PRICE RANGE (AED) Studio ,-536, One bedroom ,5 85,-1,67, Two bedroom 19 1,156-1,448 1,136,-1,457, PAYMENT PLAN 1% payable on booking 1% on signing the contract 8% on handover Dubai continues to be amongst the top global cities when taking a longer term investment view. In fact, rental yields from Dubai properties are significantly higher than those offered in global cities such as London and New York. Recent data also lists Dubai as the most affordable city to purchase a home compared with other major international hubs such as Hong Kong, Paris and Singapore. Aside from real estate, Dubai offers a world-class business environment and infrastructure for start-ups and has emerged as a leader in pioneering luxury retail and hospitality projects. Above all, Dubai is today the most transparent real estate market in the MENA region. The government is acknowledging the role that improving transparency plays in increasing levels of foreign investment. Also, measures that Dubai Land Department (DLD) is taking to improve the transparency of the Dubai real estate market such as the new building classification system which aims at creating a complete database of every single unit in Dubai alongside a star rating system, will increase Dubai s attractiveness in what can be seen as the post-oil era in the coming years. Vijay Doshi Managing Director 22

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24 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW OFFICE SECTOR OFFICE SUMMARY According to the figures released by the Dubai Economic Department (DED), over 15, new business licenses were issued in the commercial and professional categories during the first three quarters of 216, an indication of rising business confidence on the back of committed government spending towards key infrastructure projects. The rise in business licenses to a large extent will help in lowering the vacancy rates for office space. Investment grade office towers continue to remain in high demand, however there are limited opportunities. During the quarter, buildings 2 and 4 of Emaar Business Park were transacted at a total value of AED385 million. Despite high headline vacancy rates, larger occupiers continue to struggle in finding suitable office space across consecutive floors. There are enquiries for large office space currently from some of the corporates, but the corporates are experiencing difficulty in finding appropriate office accommodation in single owned buildings. In terms of new office developments, Umm Al Sheif area remains active with multiple low rise office buildings under construction. Average rental rates in the area range between AED per sq.ft. per annum (all inclusive) which are relatively higher than the prevailing rents across key freehold areas. Proximity to the CBD area, well established transport / retail network and ownership status is attracting tenants to the area. DUBAI OFFICE STOCK (28-218) Million sq.ft H1 216 Q3 216 Q Stock Expected Source: MPM Properties Research 24

25 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 216 OFFICE SUPPLY Dubai office stock reached 94 million sq.ft. with an addition of c.77, sq.ft. during the quarter. The majority of the new supply that entered during Q4 comprised of strata space (714, sq.ft.) primarily from projects that experienced construction delays and were launched during the peak of the Dubai real estate cycle. office projects expected to enter include office towers from Dubai World Trade Centre district, and delayed projects from Business Bay area. Business Bay area is expected to add 39% of the total supply followed by Dubai Trade Centre District development wherein Phase 2 of development will add two office buildings. Looking at the ongoing construction activity, we expect c.3.5 million sq.ft. of office space to enter during the course of 217. Prominent OFFICE SALES Average office sale rates dropped by 6% yearon- year. However, the sale rates in each of the freehold developments vary largely dependent on the location, layout and quality of the office space. Office sale rates in Business Bay start from as low as AED 7 per sq.ft. to a high of AED 1,5 per sq.ft. Similarly in DIFC rates range between AED 1,25 to AED 2,25 per sq.ft. During the quarter, 764,5 sq.ft. of office space transacted with a cumulative value of AED million as compared to AED million in Q4 215, an increase of 65% year-on-year. buildings were transacted at a total value of AED385 million offering 341,7 sq.ft. of sellable space, at a rate of AED 1,125 per sq.ft. Within other freehold office locations, Business Bay recorded AED 18.1 million worth of transaction for c.17, sq.ft. of office space while Jumeirah Lakes Towers recorded 131, sq.ft. of office space at a total value of AED 13 million. Dubai Marina recorded AED 87.6 million worth of office transactions while Barsha Heights recorded AED 26 million of transactions. The substantial rise in transaction value during the quarter is mainly due to transaction of Building 2 and 4 of Emaar Business Park. Together these OFFICE AVERAGE SALE PRICES Q4 216 QoQ YoY.% -2.% -1.% -5.%.% -5.%.% -5.% -3.% -11.% -3.% -5.% 2,5 AED / sq.ft. 2, 1,5 1, 5 2,2 1,775 1,475 1, Downtown Dubai DIFC Dubai Marina Business Bay Jumeirah Lake Towers Barsha Heights 25

26 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW OFFICE SECTOR OFFICE RENTS Leasing activity remained subdued during the quarter with enquiries primarily being for smaller sized offices of space less than 2,5 sq.ft. This is a typical office size requirement from new start-ups and SME s. Average office rents across Dubai have dropped by 3% during the quarter and 6% year-onyear, as certain landlords of ageing properties and strata space, vacant for over 3 months, are offering space below the prevailing market rates. Freehold areas of Jumeirah Lakes Towers, Silicon Oasis and Business Bay have recorded a higher drop in rents than traditional districts of Bur Dubai and Deira, however this is limited to smaller office sizes. Tenants are able to negotiate deals as low as AED5 per sq.ft. per annum (all inclusive) in Silicon Oasis area while in Jumeirah Lakes Towers the rents are as low as AED6 per sq.ft. per annum. We have also noticed migration of tenants from traditional business districts to CBD and Business Bay areas due to availability of fittedout office space at attractive lease terms. OFFICE RENTS AED/sq.ft. Q4 216 AED/sq.ft DIFC High Downtown Dubai Low 24 9 Sheikh Zayed Rd Business Bay 14 6 Jumeirah Lake Towers 19 7 Barsha Heights DIC & DMC 175 Source: MPM Properties Research Port Rashid Sheikh Zayed Rd. Jebel Ali Freezone TO ABU DHABI Jebel Ali Port Jebel Ali Industrial Area Sheikh Mohamed Bin Zayed Rd. Dubai World Central Airport Dubai Investment Park 1 Sheikh Zayed Rd. Jebel Ali Village The The Gardens Greens The Meadows The Discovery Lakes JUMEIRAH Gardens LAKES Jumeirah TOWERS Islands RENT = AED 6 - AED 19 /sq.ft. Emirates Hills AVG. SALE = AED 975 /sq.ft. Jumeirah Park The Springs Dubai Investment Park 2 Jumeirah Golf Estates IMPZ Jumeirah Golf Estates DIC & DMC Dubai Marina RENT = AED 12 - AED 175 /sq.ft. Media / Internet City Jumeirah Lake Towers Jumeirah Village Jumeirah Village South Dubai Sport City Dubai Barsha Heights Sheikh Mohamed Bin Zayed Rd. Motor City The Palm Jumeirah Arabian Ranches Al Sufouh BARSHA HEIGHTS RENT = AED 7 - AED 11 /sq.ft. AVG. SALE = AED Al 925 Barsha /sq.ft. Burj Al Arab Umm Suqeim Road Legends Sheikh Zayed Rd. Al Khail Road Umm Suqeim Al Barari Al Safa SHEIKH ZAYED Al RD. Quoz Al Quoz Industrial RENT Area = AED 9 - AED 18 /sq.ft. DOWNTOWN DUBAI Jumeirah RENT = AED 13 - AED 24 /sq.ft. Satwa Al AVG. Wasl SALE = AED 2,2 /sq.ft. Burj Khalifa Business Bay The BUSINESS BAY Lagoons RENT = AED 65 - AED 14 /sq.ft. AVG. SALE = AED 1,5 /sq.ft. Al Marqadh Nad Al Sheba Karama Emirates Towers DIFC DIFC Oud Metha RENT = AED 15 - AED 34 /sq.ft. Za abeelavg. SALE = AED 1,775 /sq.ft. Nad Al Sheba 2 Ras Al Khor Al Khail Road Al Raffa Festival City Naif Rigga Garhoud Port Saeed Dubai International Airport TO SHARJAH Murdif Al Mamzar Al Qusais

27 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW RETAIL SECTOR RETAIL SUMMARY During the quarter, c.21, sq.ft. GLA (gross leasable area) was added to Dubai s shopping mall / centre space stock, taking the total stock to 34.4 million sq.ft. This represents a.6% addition during the quarter and an increase of 5% year-on-year. Supply from neighborhood centres dominated during the quarter with the opening of neighborhood centres in Al Furjan, Motor City, Shurooq Mirdif and Dubai Silicon Oasis developments. Mall operators are adding new leisure and entertainment themes to boost footfalls which ultimately aid in improving overall sales across the mall. The latest addition has been in Dubai Festival City which has launched Imagine a Fire, Water and Light multimedia entertainment show. Rental rates remained stable during the quarter, however taking into consideration challenging economic conditions, weakening sales of luxury products and rise in supply, we expect rental rates to be under pressure during the course of 217. Looking at ongoing construction activity, we expect c.2.5 million sq.ft. GLA of retail to be added to the existing stock during 217. Notable additions include the Pointe on Palm Jumeirah and Fashion Avenue in Dubai Mall. PRIME SHOPPING MALL AVERAGE RENTS Q ,2 1, Anchors Cinema Hypermarket Mini Majors Flagships Restaurants Food Court Line Shops AED/sq.ft. Source: MPM Properties Research 28

28 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 216 DUBAI RETAIL MALLS GLA BY AREA Q4 216 DUBAI RETAIL SUPPLY (PRE-21) 8% 3% 3% 6% 3% 5% 2% 11% 34% 12% 17% 5% 4% 11% 7% 14% 23% 14% Deira - 2% Mirdif - 11% Business Bay - 14% Bur Dubai - 7% Barsha - 11% Dubailand - 4% Dubai Marina - 5% Jebel Ali - 5% Jumeirah - 3% Al Quoz - 6% Al Wasl - 3% Al Warsan - 8% Other Areas - 3% Neighborhood - 17% Community - 12% Regional - 14% Sub-Regional - 23% Super Regional - 34% DUBAI RETAIL MALLS BY SIZE Q4 216 NEW SUPPLY DELIVERED 21-Q % 21% 26% 32% 15% 16% 16% 2% 22% Neighborhood - 21% Community - 15% Regional - 16% Sub-Regional - 16% Super Regional - 32% Neighborhood - 32% Community - 22% Regional - 2% Super Regional - 26% Source: MPM Properties Research DUBAI RETAIL MALL STOCK - (21-218) GLA sq.ft. (Millions) H1 216 Q3 216 Q Stock Expected - *Includes all retail malls with a GLA greater than 25, sq.ft. Source: MPM Properties Research 29

29 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW HOSPITALITY SECTOR HOTEL SUMMARY During the last quarter of 216, over 2,3 rooms were added across 1 properties taking the total supply to over 13, rooms and apartments. Few of the hotels that opened during the quarter include Jumeirah Al Naseem, Metropolitan Dubai and Rove City Centre and Rove Healthcare City. Dubai s hospitality sector continues to perform well, compared globally on average occupancy levels and ADR rates, with hoteliers being increasingly pressured to sustain regional yield values. For the year the largest source of tourism predominantly comes from regional GGC tourists amounting to 24 % of visits, with foreseeable improvements with visa on arrival granted to Chinese tourists and expected Russian tourists in 217. Demand & supply across the market continues to see a balance in growth, with beach resorts showing a stabilizing of ADR s, while the city hotels are experiencing increasing ADR competition. Overall however continued pressure on rooms has started to see hoteliers optimize non-room revenues to differentiate and improve hotel value, which is attracting more demand interest. Dubai continues to enhance its infrastructure and tourism attractions with investments pouring in from both the government and private sector. The opening of Dubai canal and theme parks are few recent additions which would act as a catalyst towards further growth of the tourism sector. DUBAI HOTEL ROOMS SUPPLY ( ) No. of Rooms ('s) H1 216 Q3 216 Q Existing Supply New Supply Source: MPM Properties Research 3

30 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 216 DUBAI HOTELS PERFORMANCE YTD AED 1,2 1, Feb-14 Mar Apr May Jun Jul Aug Sep Oct Nov Dec Feb-15 Mar Apr May Jun Jul Aug Sep Oct Nov Dec Feb-16 Mar Apr May Jun Jul Aug Sep Oct Nov Dec 1.% 9.% 8.% 7.% 6.% 5.% 4.% 3.% 2.% 1.% % Occupancy ADR RevPAR Occupancy Source: MPM Properties Research HOTELS - NEW SUPPLY Q4 216 HOTEL NAME LOCATION STAR DATE NUMBER OF KEYS Premier Inn Ibn Battuta 3 star Q Rove City Centre Port Saeed 4 star Q Metropolitan Hotel Sheikh Zayed Road 4 star Q Jumeirah Al Naseem Jumeirah 5 star Q SAMPLE OF UPCOMING SUPPLY HOTEL NAME LOCATION STAR DATE NUMBER OF KEYS The Address Boulevard Downtown Dubai 5 star Q Dukes Dubai Palm Jumeirah 5 star Q Viceroy Palm Jumeirah 5 star Q Dusit Emirates Saray Palm Jumeirah 5 star Q

31 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW DEFINITIONS & METHODOLOGY RESEARCH STUDY AREA The geographic extent of the study area covers the key districts in Dubai. RESIDENTIAL New residential developments are classified as delivered and thus entered into the new supply category when they are made available for occupation. This is verified via a combination of site inspections and discussion with the developer and hence our supply numbers do take into consideration the phased release of large projects. Rental and sales trend analysis is based on transactional data derived from the MPM Properties Agency team and data sourced from developers and owners. OFFICES New office developments are classified as delivered and thus entered into the new supply category when they are available for tenant fit-outs. Given the general lack of transparency in the local market rents quoted are headline rents, thus exclude any rent free period of other financial incentives that may have been negotiated between the parties. The rents quoted are also exclusive of service charges. RETAIL New retail developments are classified as delivered and thus entered into the new supply category when the first units are open and trading. Our classification of malls is based on our own assessment having regard to size and the catchment area which the mall typically penetrates. HOSPITALITY New hotels are classified as delivered and thus entered into the new supply category when they are opened and trading. All trading performance data is provided by DTCM. FUTURE SUPPLY PROJECTIONS Our future supply projections across all sectors are based on a combination of regular site inspections and discussions with developers. BESPOKE CLIENT RESEARCH ADDING VALUE TO YOUR PROPERTY INTERESTS The ADIB Real Estate Services team covers all sectors of the real estate market. We provide bespoke market research to our valued clients to meet their specific requirements. We provide reports, information and presentations derived from primary market data that directly assist our clients to save or make money from real estate and shape strategies to enhance value. DISCLAIMER: The information contained in this report has been obtained from and is based upon sources that MPM Properties believes to be reliable, however, no warranty or representation, expressed or implied, is made to the accuracy or completeness of the information contained herein, and same is submitted subject to errors, omissions, change of price, rental or other conditions, withdrawal without notice, and to any special listing conditions imposed by our principals. MPM Properties will not be held responsible for any third-party contributions. All opinions and estimates included in this report constitute MPM Properties, as of the date of this report and are subject to change without notice. Figures contained in this report are derived from a basket of locations highlighted in this report and therefore represent a snapshot of the Dubai market. Due care and attention has been used in the preparation of forecast information. However, actual results may vary from forecasts and any variation may be materially positive or negative. Forecasts, by their very nature, involve risk and uncertainty because they relate to future events and circumstances which are beyond MPM Properties control. For a full in-depth study of the market, please contact MPM Properties team. 32

32 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW Q4 216 A collaborative team providing our integrated services CHARLES ANDREW CHAMBERS CEO T: +971 () M: +971 () andrew.charles@mpmproperties.ae ABDULLAH SAID AL KUWEITI Business Development Director T: +971 () M: +971 () abdullahs@mpmproperties.ae FRANK O DWYER MBA (Hons); BEng. COO T: +971 () M: +971 () f.odwyer@mpmproperties.ae VAIBHAV SHARMA MCOM; MDBA Chief Strategy Officer T: +971 () M: +971 () vaibhav.sharma@adib.com YOUSEF AL ZAROONI Regional Head Al Ain T: +971 () M: +971 () yousef.alzarouni@mpmproperties.ae PAUL MAISFIELD BSC (HONS) MRICS Head of UK Real Estate T: +44 () M: +44 () paul.maisfield@adib.com VINEET KUMAR Director of Agency Dubai T: +971 () M: +971 () vineet.kumar@adib.com DOMINIC BARLOW Head of Retail, Hospitality & Leisure T: +971 () M: +971 () dominic.barlow@adib.com ALI ABDULLAH ABDUL RAHMAN Acting Regional Head Northern Emirates T: 971 () M: +971 () aliabdullah@mpmproperties.ae MOHAMMED FAHEEM Manager Strategic Advisory & Research T: +971 () M: +971 () mohammed.abdulfaheem@adib.com WAHIDA KARAMA Head of Property Operations T: +971 (2) M: +971 () wahida.karama@mpmproperties.ae JUBRAN AL HASHMI Head of Property Services T: +971 () M: +971 () jubran@mpmproperties.ae BALAJI NAGARAJ MSC MRICS Head of Residential Valuation Dubai & Northern Emirates T: +971 () M: +971 () b.nagaraj@mpmproperties.ae MOHAMED AL ZOUBI Head of Development Advisory BSc Civil Engineering T: +971 () M: +971 () mohammedalzoubi@mpmproperties.ae 33

33 Q4 216 REAL ESTATE SERVICES DUBAI REAL ESTATE MARKET OVERVIEW SUPPLY - PHOTO GALLERY NEW SUPPLY Q4 216 RESIDENTIAL SAMPLE OF UPCOMING PROJECTS Q4 216 RESIDENTIAL 1 ONYX TOWER SHEIKH ZAYED RD. 2 MAJESTIC TOWER BUSINESS BAY 3 ESCAN TOWER DUBAI MARINA 4 AL SHAFAR RESIDENCES BUSINESS BAY 1 DUBAI WHARF, CULTURE VILLAGE 2 EMIRATES AIRLINE ACCOMMODATION 3 VICEROY PALM JUMEIRAH 4 SOBHA MEYDAN VILLAS DISTRICT ONE MBRC OFFICE OFFICE 1 ONYX TOWER SHEIKH ZAYED RD. 2 OFFICE TOWER UMM AL SHEIF 3 B2B OFFICE TOWER BUSINESS BAY 4 PALAZZO VENEZIA MAJAN 1 EIFFEL 1, UMM AL SHEIF 2 THE OPUS, BUSINESS BAY 3 NBAD OFFICE BUILDING AL JADDAT RETAIL RETAIL 1 THE RIBON, MOTOR CITY 2 PAVILLION AL FURJAN 3 SOUK EXTRA, DSO 4 SHUROOQ MIRDIFF 1 THE POINTE PALM JUMEIRAH 2 NAKHEEL MALL, PALM JUMEIRAH 3 GOLDEN MILE 2 PALM JUMEIRAH 4 DUBAI MALL ZABEEL EXTENSION HOTEL HOTEL 1 ROVE CITY CENTRE PORT SAEED 2 PREMIER INN IBN BATTUTA MALL 3 METROPOLITAN SHEIKH ZAYED RD. 4 JUMEIRAH AL NASEEM UMM SUQEIM 1 VICEROY PALM JUMEIRAH 2 DUKES DUBAI PALM JUMEIRAH 3 THE ADDRESS BOULEVARD DOWNTOWN DUBAI

34 Q4 216 Q4 216 NEW SUPPLY Residential Offices Retail Hotels UNDER CONSTRUCTION Residential Offices Retail Hotels Jebel Ali Port Al Mamzar Jebel Ali Freezone Barsha Heights Al Qusais TO ABU DHABI

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