Property Review Abu Dhabi Real Estate Report In the Middle East for over 30 Years
CONTENT 03 05 07 09 MARKET OVERVIEW APARTMENT RENTAL RATES VILLA RENTAL RATES OFFICE RENTAL RATES 04 06 08 10 SUPPLY APARTMENT SALES PRICES VILLA SALES PRICES PROPERTY MAP 2
ABU DHABI MARKET OVERVIEW SUPPLY RENTAL RATES SALES PRICES Approximately 1,600 residential units were delivered in with the bulk (more than 75%) located within the Investment Zones, including, but not limited to Yas Island, Al Reem Island and Al Raha Beach. In addition to a number of stand-alone buildings in different locations, the key projects that were handed over included Ansam- Yas Island, Al Hadeel- Al Raha Beach and Muhaimat Tower- Al Reem Island. Apartment and villa rental rates declined on average by 3% and 2% since Q4 2017, whilst recording annual decreases of 11% and 9%, respectively. Apartment sales prices remained broadly unchanged over the quarter for the majority of locations, with the exception of Marina Square (-5%), Reef Downtown (-6%) and Sun & Sky Towers (-6%), which faced increased competition from new off-plan developments offered at attractive rates and favourable payment plans. Furthermore, a number of new projects were launched this quarter such as the Al Fahid Island Master Development by Al Nahda Investment and the Reflection Towers on Reem Island by Aldar. The most noteworthy announcement, however, was the Saadiyat Grove Development by Aldar and Emaar, which falls under a strategic alliance between both Developers to develop local and international projects worth AED 30 billion. As a result of the continuous delivery of new supply during a period of restrained economic growth and subdued market sentiment, vacancy rates increased across all residential unit types. Office demand levels continued to be low resulting in a Q-o-Q drop in rental rates of 2% on average. Nevertheless, a number of Landlords offered space with discounts of up to 5% in order to retain Tenants and/or entice new take-up. Similarly, Al Reef was the only area recording a drop in villa sales prices at an average rate of 2%. Although healthy demand for high-quality, off-plan and newly delivered projects continued, inferior residential units remained under pressure. Whilst more than 7,300 units are earmarked for handover before the end of 2018, previous delivery patterns suggest a number of these are likely to be delayed and will spill over into 2019. The expected supply includes: Over 2,500 units on Reem Island; 1,800 on Yas and Saadiyat Islands (i.e.: West Yas, Jawaher Al Saadiyat and Mamsha Al Saadiyat); More than 1,650 units on the Abu Dhabi Mainland; and Remainder located on Abu Dhabi Island. No major office supply was delivered in the first quarter of 2018. The anticipated Omega Towers on Reem Island and the ADIB HQ on Airport Road are due for handover before year-end. 3
SUPPLY COMPLETED IN 2017 COMPLETED IN EXPECTED BY END OF 2018 APARTMENTS NO. OF UNITS 3,000 1,600 4,500 VILLAS NO. OF UNITS 750 50 2,800 OFFICES SQ.M. 85,000 0 100,000 4
APARTMENT RENTAL RATES (All figures in AED 000 s p.a.) TYPE PRIME PROPERTIES ABU DHABI ISLAND - - 85 130 130 170 165 255-2% -15% INVESTMENT AREA 90 105 110 155 135 215 180 300-3% -4% HIGH END PROPERTIES ABU DHABI ISLAND INVESTMENT AREA MID AND LOWER END PROPERTIES LOW END PROPERTIES STUDIO 1 BEDROOM 2 BEDROOMS 3 BEDROOMS % CHANGE FROM TO FROM TO FROM TO FROM TO Q4 2017 - Q1 2017 - Central Abu Dhabi - - - - 80 135 140 170-5% -14% Corniche - - 75 90 100 135 145 190-4% -13% Khalidya / Bateen 83-85 105 85 150 135 200-3% -12% Al Raha Beach - - 80 105 120 150 150 195-5% -12% Marina Square 50-65 95 85 140 120 175-5% -14% Shams Abu Dhabi 60-70 80 100 120 125 160-4% -17% Saadiyat Beach - - 105 118 163 165 190 200-2% -5% ABU DHABI ISLAND 45 65 55 100 75 145 120 170-5% -13% INVESTMENT AREA Shams Abu Dhabi - - 65 80 80 120 115 150-4% -16% Najmat & Tamouh 42 55 65 80 80 120 110 155-4% -12% OFF ISLAND Khalifa & MBZ City 40 45 55 82 70 125 140 150-4% -14% ABU DHABI ISLAND Central Abu Dhabi 35 40 50 65 60 80 85 115-3% -12% Corniche 40 50 55 65 75 80 90 118-1% -7% Khalidiya / Bateen 40 45 55 60 70 80 90 115-3% -1 INVESTMENT AREA Al Reef 50 55 63 70 75 85 95 120-3% -12% OFF ISLAND Khalifa & MBZ City 30 45 40 50 55 70 70 90-2% -8% 2% % Change Q-o-Q Since Q4 2017 Y-o-Y Since Q1 2017 Since peak Q4 2015 Since market low Q2 2012-3% -11% -2 5
APARTMENT SALES PRICES AED per sq.ft. 0 500 1,000 1,500 2,000 Q-o-Q % Change (Q4 2017-) Y-o-Y % Change (Q1 2017-) AL BANDAR 1,400 1,800-6% AL MUNEERA 1,200 1,350-12% AL ZEINA 1,100 1,350-6% CITY OF LIGHTS - HYDRA 750 850-22% MARINA SQUARE 950 1,150-5% -14% REEF DOWNTOWN 750 900-6% -15% SAADIYAT BEACH RESIDENCES 1,350 1,500-5% SUN & SKY TOWERS 1,100 1,300-6% -14% THE GATE 1,100 1,350-9% YAS ISLAND 1,300 1,500 n/a n/a 28% % Change Q-o-Q Since Q4 2017 Y-o-Y Since Q1 2017 Since peak Q4 2015 Since market low Q3 2012-2% -12% -15% 6
VILLA RENTAL RATES (All figures in AED 000 s p.a.) TYPE 1 BEDROOM 2 BEDROOMS 3 BEDROOMS 4 BEDROOMS % CHANGE FROM TO FROM TO FROM TO FROM TO Q4 2017 - Q1 2017 - ABU DHABI ISLAND INVESTMENT AREA OFF ISLAND Khalidiya / Bateen - - 160 180 170 180 180 220-1% -8% Mushrif / Karama / Manaseer - - 155 175 160 185 180 210-1% -8% Nahyan Camp / Muroor - - 125 170 160 185 170 200-6% Al Raha Beach - - 180 190 200 270 250 285-2% -1 Al Reef 90 105 115 125 145 155 155 170-9% Hydra Village 75 82 85 95 - - - - -4% -11% Saadiyat Island - Beach Residences - - 290 310 280 370 400 720-2% -1 Hidd Al Saadiyat - - - - 300 340 360 790 na na Al Raha Gardens - - 155 180 170 205 190 240-1% -11% Golf Gardens - - 200 220 220 240 240 290-2% -8% Khalifa City - - 115 135 130 145 140 155-2% -8% Mohamed Bin Zayed - - 100 115 120 135 140 155-3% -6% % Change Q-o-Q Since Q4 2017 Y-o-Y Since Q1 2017 Since peak Q4 2015 Since market low Q4 2012-2% -3% -9% -1 7
VILLA SALES PRICES AED Million 0 2 4 6 8 10 12 Q-o-Q % Change (Q4 2017-) Y-o-Y % Change (Q1 2017-) AL REEF VILLAS 2 BR 3 BR 4 BR 5 BR 1.43 1.78 2.15 2.65-2% -5% GOLF GARDENS 3 BR 4 BR 5 BR 3.15 3.95 4.88-1% HIDD AL SAADIYAT 4 BR 5 BR 6.65 8.25 n/a n/a HYDRA VILLAGE 2 BR 3 BR 0.92 1.28-8% RAHA GARDENS 3 BR 4 BR 5 BR 2.55 2.95 4.10-4% SAADIYAT BEACH VILLAS (STANDARD) 3 BR 4 BR 5 BR 5.75 6.55 10.70 4 % Change Q-o-Q Since Q4 2017 Y-o-Y Since Q1 2017 Since peak Q4 2015 Since market low Q4 2012-4% -8% 8
OFFICE RENTAL RATES (All figures in AED 000 s sq.m. p.a.) TYPE AVERAGE RENTAL RATES % CHANGE FROM TO Q4 2017 - Q1 2017 - PRIME STOCK FITTED* 1,500 2,500-3% QUALITY STOCK FITTED 770 1,300-3% -5% SHELL AND CORE 700 1,050-3% OLDER STOCK GOOD 650 800-5% -7% TYPICAL BUILDING 600 700-2% LOW QUALITY BUILDING 530 600-2% -2% * Includes developments such as Al Maryah Island, Aldar HQ, International Tower, Nation Towers, Ittihad Towers, Capital Plaza, Etihad Tower, etc. % Change Q-o-Q Since Q4 2017 Y-o-Y Since Q1 2017 Since peak Q4 2015 Since market low Q4 2012-2% -4% -12% -14% 9
PROPERTY MAP 1 Al Bandar Raha Beach 2 Al Bateen Wharf 3 Al Gurm 4 Al Maqtaa 5 Al Muneera Al Raha Beach 6 Al Nahyan Camp 7 Al Raha Gardens 8 Al Rayanna 9 Al Reef 10 Al Zeina Al Raha Beach 11 Baniyas 12 Bateen Airport Area 13 Bateen Area 14 Bawabat Al Sharq 15 Capital District (ADNEC) 16 CBD / Tourist Club Area 17 Corniche 18 Danet Abu Dhabi 19 Eastern Mangroves 20 Golf Gardens 21 Hydra Village 22 Khalidia / Al Hosn / Al Manhal 23 Khalifa City A 24 Khalifa City B 25 Maryah Island 26 MBZ City 27 Mina 28 Mushrif / Karama / Manaseer / Muroor 29 Officer s City 30 Rawdhat Abu Dhabi 31 Reem Island - Marina Square 32 Reem Island Najmat Abu Dhabi 33 Reem Island rest of Shams Abu Dhabi 34 Reem Island City of Lights 35 Reem Island The Gate District 36 Rihan Heights 37 Saadiyat Beach District 38 The Hills YAS ISLAND Note: Area classification by affordability is provided for indicative purposes only as most areas in Abu Dhabi offer various types of residential units, from affordable to high end. As such, the map colour coding takes into account the most prevalent type of product and exceptions of a lower and / or higher price could be available. 10
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John Stevens MSc, BSc (Hons), MRICS Managing Director/ Director - Asset Services +971 600 54 7773 JohnS@Asteco.com John Allen BSc, MRICS Director - Valuation & Advisory +971 600 54 7773 JohnA@Asteco.com Derrick Maguire ARLA, NAEA Associate Director - Transactional Services +971 600 54 7773 DerrickM@Asteco.com James Joughin BSc (Hons), MRICS Associate Director - Valuation +971 600 54 7773 JamesJ@Asteco.com Jenny Weidling BA (Hons) Manager - Research and Advisory, Dubai +971 600 54 7773 JennyW@Asteco.com Ghada Amhaz MSc Manager - Research and Advisory, Abu Dhabi +971 2 626 2660 GhadaA@asteco.com Tamer Ibrahim Chaaban BE Branch Manager - Al Ain office +971 3 7666097 TamerI@asteco.com DISCLAIMER: The information contained in this report has been obtained from and is based upon sources that Asteco Property Management 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. Asteco Property Management will not be held responsible for any third-party contributions. All opinions and estimates included in this report constitute Asteco Property Management s judgment, 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 UAE market. Averages, however, represent a wider range of areas. Particularly exclusive or unique projects have been excluded from the data to avoid distorting averages. 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 Asteco Property Management s control. 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