Q1 2016 - MPM Properties

Q1 2016 - MPM Properties

REAL ESTATE SERVICES ABU DHABI REAL ESTATE MARKET OVERVIEW Q1 2016 Q1 2016 | ABU DHABI REAL ESTATE MARKET OVERVIEW REAL ESTATE SERVICES FOREWOR...

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REAL ESTATE SERVICES

ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

Q1 2016

| ABU DHABI REAL ESTATE MARKET OVERVIEW

REAL ESTATE SERVICES

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 „„ Investment „„ Asset

„„ Valuation

advisory

advisory

management

„„ Project

management

„„ Agency „„ Market

research

„„ Property

management

„„ Facilities

management

One of the aims of this report is to aid with improving market transparency by basing our analysis wherever possible on primary transactional evidence derived from our own managed portfolio and from the analysis of our sales and home financing activities. We believe that this adds credibility to the analysis and we hope provides confidence in its reliability.

REPORT HIGHLIGHTS Residential Q1 2016 was characterized by the following trends:

transactional activity has been very low in Q1 2016 given the impact of lower oil prices on the SME segment of market with most companies putting relocation plans on hold.

1) Constrained new supply – the addition of only 1,000 new homes

Retail Sector

2) Moderation of rental growth – Analysis of the MPM portfolio during Q1 2016 shows 38% of lease renewals were agreed with no increase, 61% showed an increase and 1% had a decline

There have been no new retail developments completed in Abu Dhabi during the first quarter of 2016 and thus total retail stock in the Capital remains at approximately 2.4 million sqm of GLA. Mall revenues have been under pressure during the first quarter of 2016, with the outlook for the remaining year indicating further softening of consumer spending, leading to increased pressure on revenues.

3) Stable sale prices on the back of subdued transaction activity These trends are expected to continue during the rest of 2016. MPM expects less than 2% housing stock growth in 2016 vs. an average of 4.5% p.a. over the last 7 years. The slowdown of new supply will counter some of the downward pressure on rents, although a marginal correction is expected in the months ahead.

Office The commercial office market witnessed the addition of approximately 57,000 sqm during Q1 2016, with only 10,000 sqm being speculative, whilst the rest is owner occupied or pre-let. Grade A space rents have increased marginally by 1%, supported by the lack of new supply in this segment. On the contrary rents in Grade B office space have seen a decline of 3%. In terms of office sales

2

Hospitality Sector In Q1 2016, only one new hotel (Al Seef Resort) entered the market adding 210 rooms. Supply in the hotel sector is expected to increase by 2,812 keys by the end of 2016. Guest arrivals into Abu Dhabi are up by 10% in Q1 2016 YTD vs. Q1 2015 YTD. This growth came despite a decline in tourist arrivals from key countries of China and USA along with a marginal (2%) increase in arrivals from UK. Total revenue for hotel establishments recorded 9% decrease (AED 1,092 Million), room revenue decreased by 14%, whilst F&B revenue declined 4%.

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

MPM PROPERTIES FACTS AND FIGURES

160+ TOTAL UAE STAFF

35+

LEASING & SALES STAFF

95+

30+

PROPERTY MANAGEMENT STAFF

No.1 LARGEST ABU DHABI MAINLAND PORTFOLIO

23,500+ UNITS UNDER MANAGEMENT

90bn

COMBINED MARKET VALUE OF PROPERTIES VALUED SINCE JANUARY 2012

ADVISORY STAFF

1,700 LANDLORD CLIENTS

20+ 98.5% DEDICATED VALUATION PROFESSIONALS

OCCUPANCY RATE

7,600+ MORTGAGE VALUATIONS SINCE JANUARY 2012

CONTENTS Demand Drivers

4

Macro Trends

6

Residential Sector

8

Project in Focus

14

Office Sector 16 Retail Sector 20 Hospitality Sector 22 Definitions & Methodology

24

Contact Information 25 Supply - Photo Gallery

26

Development Location Map

28

3

Q1 2016

| DEMAND DRIVERS

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

DEMAND DRIVERS – Q1 2016

GOVERNMENT INITIATIVES „„

As per February’s Official Gazette, expatriate tenants in Abu Dhabi will have to pay 3 per cent extra on their rent, as a municipality contract fee. The new charge will be added to monthly electricity and water bills. The collection of this charge is yet to be implemented

„„

The UAE federal government has proposed to raise between AED 80 billion to AED 100 billion through the issue of bonds in the next year, which will allow the UAE to fund the majority of the expected fiscal deficit during 2016. This in turn will reduce the need to draw down on bank deposits or sell assets

„„

The Abu Dhabi government is set to hand over 2,048 villas to its citizens across the emirate with 1,463 units in Abu Dhabi, 236 units in Al Ain and 349 in the Western Region. In addition about 4,495 plots will also be distributed to citizens, including 2,432 plots in the Abu Dhabi, 1,713 in Al Ain and 350 in the Western Region

„„

Abu Dhabi’s mainland areas will have over AED470 million invested in the development of infrastructure projects. The areas cover Musaffah and Mohammad Bin Zayed City, and include the construction of internal roads, parks, sports courts, reservoirs, irrigation networks and pumping stations

„„

State oil explorer and power supplier Abu Dhabi National Energy Co (TAQA) has reduced its proposed capital expenditure for the year. The reduction is driven due to low oil prices. The firm, which is 75 per cent owned by the Abu Dhabi government, said it reduced capex by 52 per cent in 2015 and planned a further 42 per cent cut in 2016

OIL & GAS „„

Q1 2016 began with a sharp decline in oil prices with levels reaching multi year lows (below $30 per barrel) in early February. However, the prices have rebounded since then, breaching the $40 per barrel mark. Q1 ended with prices above $38 per barrel, representing a 13% surge in March 2016

„„

The UAE plans to boost crude output capacity to 3.5 million barrels a day by 2017 from present production levels of approximately 2.98 million barrels per day

KEY EVENTS

4

„„

World Future Energy Summit, 18th – 21st January 2016

„„

International Water Summit, 16th –19th January 2016

„„

Global Forum for Innovation in Agriculture, 16th – 17th February 2016

„„

Middle East Drilling Technology Conference & Exhibition, 26th – 28th January 2016

„„

Abu Dhabi Pharmacy Conference, 19th – 21st February 2016

„„

VIV MEA, 15th – 17th February 2016

„„

Global Financial Markets Forum, 2nd – 3rd March 2016

„„

Unmanned Systems Exhibition & Conference, 6th – 8th March 2016

„„

Abu Dhabi Aviation and Aerospace Week, 6th – 8th March 2016

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

| DEMAND DRIVERS

REAL ESTATE AND CONSTRUCTION CREATING JOBS „„

Aldar Properties has awarded a AED 2 billion ($544.5 million) construction contract to Arabtec for construction of 1,017 luxury villas in Abu Dhabi. The project is scheduled to be completed towards the end of 2019

„„

Aldar properties has invested about AED 900 million as part of a AED 3 billion plan to boost their rental portfolio. As a part of these investments Aldar Properties has purchased Daman House, located at the Capital Centre district close to the city’s exhibition centre. The office tower houses the national insurance company Daman on a long term lease. Though the size of the transaction was not revealed, it is estimated to be worth around AED 330 million. Additionally, Aldar has invested AED 410 million in the extension of Al Jimi Mall and will spend AED160 million on construction of Al Mamoura School

„„

Construction has commenced on ‘Al Qana’, a leisure oriented, mixed used project being built around the canal near Al Maqta Bridge, admeasuring 150,000 sqm. The project is scheduled to be completed in the second quarter of 2018 and will offer recreation, high-end shopping, and fine dining. The project is being developed under a Build-Operate-Transfer (BOT) arrangement between Al Barakah International Investments and Abu Dhabi Municipality

„„

Al Qudra Real Estate has completed the Infrastructure works at their 200,000 sqm Danet Abu Dhabi development. Lighting, power distribution, and water-cooling networks for the master development are now in place

„„

Masdar City has outlined a five-year expansion plan that will include the construction of 2,000 homes and a research hub. The completion status of Masdar city master plan will increase to 35 per cent from 5 per cent presently

TOURISM INITIATIVES „„

As per a new decree, a 4 per cent municipality fee and a AED 15 charge per night per room will be imposed on hotel bills in Abu Dhabi. This will raise hundreds of millions of dirhams in revenue for municipal authorities with fees being collected by the Abu Dhabi Tourism and Culture Authority (TCA) and added to the government budget of the Department of Municipal Affairs

„„

ADNEC has signed a deal with INDEX Conferences and Exhibitions to attract more events to Abu Dhabi. The Dubai-based firm will initially bring four new events to Abu Dhabi - Children & Parents World Exhibition, Lifestyle Exhibition, Media Communication & Content World Conference and Atech World Conference and Exhibition this year

„„

A delegation from Abu Dhabi including the TCA Abu Dhabi, will attend the World Travel Market Africa 2016 (WTM Africa) in

April to capitalise on the surging growth in South African visitor numbers into the emirate. Since TCA Abu Dhabi opened an office in Johannesburg, South Africa last year to help promote the Emirate as a leisure and business destination, tourist arrivals from South Africa into Abu Dhabi have increased by 50% „„

Etihad Holidays, a unit of Etihad Airways, launched a new campaign offering “guaranteed sunshine or your next holiday for free” for UK visitors staying between May and September. The campaign will apply to every booking that consists of a flight and hotel-inclusive package. Under the offer, the visitors will be eligible for a free holiday if they experience more than 5mm of rain

FREEZONES

SIGNING UP NEW TENANTS; FORMING KEY ALLIANCES „„

The Abu Dhabi Global Market Freezone, set up in October 2015, is expecting significant activity this year. They have far received interest from a number of financial services firms to set up businesses within the freezone in Al Maryah Island

„„

Dubal Holding, Dubai Investments and Singapore-based industrial group MARS are investing $120 million to build an aluminum rolling

plant in Abu Dhabi’s industrial free zone. The joint venture will be known as Emirates Aluminium Rolling LLC (Emiroll), with plans to manufacture 65,000 tonnes of aluminium coils annually. The plant is anticipated to start production in the third quarter of 2017

5

| MACRO TRENDS

Q1 2016

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

MACRO TRENDS

REAL GROWTH RATE 2014-2018 REALGDP GDP GROWTH RATE 2014-2018 Wholesale and retail trade; repair of motor vehicles and motorcycles

6%

6.8%

Accommodation and food service activities

10.0%

Manufacturing

10.0%

Transportation and storage and communications

11.1%

5% 4%

Financial and insurance activities 0%

ABU DHABI GDP FORECAST 2014-2018 ABU DHABIREAL REAL GDP FORECAST 2014-2018

3%

5.5%

2013

Avg. 2014-2018

1%

15.0%

3%

5.2%

2%

6%

9%

12%

0%

15%

Source: DED DED Source:

Source: DED Source: DED

CONSUMER CONFIDENCE INDEX

BUSINESS CLIMATE INDEX 80

150

70 120 60

Q1 2016

Q3 2015

Q1 2015

Q3 2014

Q1 2014

Q1 2013

Q3 2013

Q3 2012

Q1 2012

Q3 2011

Q1 2011

Q1 2010

Q1 2016

Q1 2015

Q1 2014

Q1 2013

Q1 2012

Q1 2011

Q1 2010

Source: DED

Q3 2010

50

90

Source: DED

CPI VS RENTAL CONTRIBUTION TO CPI 106 104 102 100 98

CPI

Rental Contribution to CPI

Source: SCAD and MPM Properties Research

6

Mar 16

Jan 16

Oct 15

Jul 15

Apr 15

Jan 15

Oct 14

Jul 14

Apr 14

Jan 14

Oct 13

Jul 13

Apr 13

Jan 13

96

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

| MACRO TRENDS

STOCK MARKET vs OIL vs GOLD 350 300 250 200 150 100 50

Abu Dhabi Stock Market Index

Gold

Abu Dhabi Murban Crude Oil

FX RATES vs USD

Mar-16

Dec-15

Dec-14

Dec-13

Jan-11

Dec-11

Dec-12

0

Dubai Stock Index

PROFIT RATE

FX RATES vs USD

Q1 2016

3mths ago

6mths ago

12mths ago

PROFIT RATES

O/N

3mths ago

6mths ago

12mths ago

GBP

1.4226

1.4736

1.5128

1.4818

GBP

0.4800

0.5881

0.7404

1.0115

EUR

1.1175

1.0862

1.1177

1.0731

EUR

-0.3900

-0.2420

-0.1340

-0.0050

JPY

113.65

120.22

119.88

120.13

USD

0.3745

0.6286

0.9190

1.2312

INR

66.55

66.15

65.59

62.50

AED

0.3000

1.0237

1.2790

1.5826

PKR

104.70

104.73

104.46

101.93

RUB

68.69

72.52

65.36

58.19

CNY

6.5114

6.4937

6.3560

6.1997

HKD

7.7571

7.7507

7.7500

7.7524

QAR

3.6406

3.6419

3.6420

3.6411

AED

3.6725

3.6725

3.6725

3.6725

Source: ADIB Treasury and Bloomberg

Source: ADIB Treasury and Bloomberg

REALTY STOCK INDEX ABU DHABI vs DUBAI

Dubai realty index

Mar 16

Jan 16

Jul 15

Jan 15

Jul 14

Jan 14

Jul 13

Jan 13

Jul 12

Jan 12

Jul 11

Jan 11

Jul 10

Jan 10

Jul 09

Jan 09

Jul 08

Jan 08

Jul 07

Jan 07

400 350 300 250 200 150 100 50 0

Abu Dhabi realty index

Source: Bloomberg and MPM Properties Research

7

Q1 2016

| RESIDENTIAL SECTOR

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

MARKET OVERVIEW Q1 2016 RESIDENTIAL SECTOR

SUPPLY New supply In the first 3 months of 2016 there were just over 1,000 new homes delivered to the Abu Dhabi market. This comprised predominantly small to medium sized developments in the Al Nayhan Camp / Muroor Road area on the main Abu Dhabi Island and in Mohammed Bin Zayed City, with the only large new developments handed over in Q1 comprising The Wave (229 apartments) located at Najmat Abu Dhabi on Reem Island, C39 at Danet Abu Dhabi (219 apartments) and the Ali & Sons building at Rawdhat Abu Dhabi (120 apartments). MPM forecasts that 2016 will witness the lowest levels of new supply in over seven years with less

than 5,000 new homes due to enter the market during 2016, equating to housing stock growth of less than 2% compared to an average annual growth over the last 7 years of approximately 4.5%. This low level of new residential supply is sustaining steady rental growth, particularly in the luxury and low-cost segments of the market which both suffer from a lack of availability. In these segments of the market rents are typically increasing between 3-5% at lease renewal and landlords are still able to command premium rents for the small quantity of units that become vacant, although vacancy periods have extended, indicating that demand has weakened

ABU DHABI NEW HOUSING SUPPLY Number of residential units

150,00 120,00 90,00

2,013

60,00

2,925

30,00

5,945

0 2010

7,308 3,655

4,604 3,732

5,135

4,691

3,212

3,970 1,613

675 2,221

2,863

2,411

2,371

2011

2012

2013

2014

Off-Island

On-Island

2,365

229 304

2,227

528

951 1,663 1,920

1,202

2015

2016 Q1

2016 Q2-Q4

3,626

2017

2,426

4,668

1,400

518

2018

2019

Investment Area

Source: MPM Properties Research

CUMULATIVE RESIDENTIAL SUPPLY Number of Residential Units

300,000 250,000 200,000

5.68%

3.54%

177,400 187,473

194,101

6.19% 206,121

5.37% 217,193

2.57%

0.46%

2014

2015

2016 2016 2017 Q1 Q2-Q4

232,636 236,192 244,424 225,781 231,575

2.03% 4.56% 255,558 260,744

150,000 100,000 50,000 0

Pre 2010*

2010

2011

2012

2013

Total Supply

8

1.53%

3.49%

3.95%

Source: MPM Properties Research

2018

2019

*per UPC

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

| RESIDENTIAL SECTOR

THE ADIB RENTAL INDEX „„

The supply and demand dynamic in the wider Abu Dhabi market is more balanced evidenced by the fact that, despite reports of redundancies and housing allowances being cut, rents remain broadly stable. An analysis of the MPM portfolio, which comprises over

ADIB INDEX

12,000 units in Abu Dhabi shows that 38% of lease renewals completed in the first quarter of this year were agreed at a zero percent increase. 61% showed an increase and only 1% had a rent reduction.

(see map at end of report)

ZONE

< 0%

0% to 4.99%

5%

5% to +9.99%

10% to +19.99%

20%+

A

0%

52%

32%

10%

6%

0%

B

1%

59%

14%

13%

10%

2%

C

0%

40%

17%

24%

13%

5%

D

0%

41%

11%

23%

20%

4%

E

0%

37%

16%

21%

16%

11%

F

0%

60%

18%

11%

11%

0%

G

5%

84%

5%

5%

0%

0%

H

0%

58%

17%

21%

4%

0%

I

0%

73%

15%

12%

0%

0%

J

0%

50%

21%

21%

0%

7%

K

1%

56%

6%

25%

10%

1%

ADIB RENTAL INDEX NOTES „„

The ADIB Rental Index relates to the performance of the ADIB portfolio only and the data is derived exclusively from transactions completed by MPM Properties.

„„

The ADIB Portfolio in Abu Dhabi comprises over 12,000 units (70% apartments, 30% villas) with a spread of quality and locations both on the Abu Dhabi Island and the growing Off-Island areas.

„„

The ADIB Rental Index has been compiled with a view to enhancing transparency in the Abu Dhabi real estate market and to provide a credible market indicator for rental trend movements.

„„

Rental Index Zones are identified on the Map located at the end of this report.

9

Q1 2016

| RESIDENTIAL SECTOR

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

RESIDENTIAL SECTOR

APARTMENT SALE PRICES The sales market continues to be characterized by weak sentiment translating into an environment where both buyers and sellers are equally unmotivated to enter the market thus we are seeing low transaction volumes and prices remaining broadly stable. Demand remains focused on small units commanding the highest rental yields, however there are currently few opportunities in the market as vendors continue to hold, collect rental income and wait for the longer term capital appreciation. Despite some rental declines on Reem Island we have yet to witness any evidence of this impacting sale prices during the first quarter of the year, although a continuation of falling rents will inevitably start to put downward pressure on values to counter the yield erosion.

Aldar, TDIC and Bloom all set to announce major new developments at Cityscape in April. The off-plan sales market in Abu Dhabi has witnessed over 10 new projects launched to the market over the last 18 months, (prior to Cityscape Abu Dhabi April 2016), comprising over 4,500 units. Our research shows that despite more challenging market conditions being experienced in 2015 take up in these new developments has generally been strong with most projects having sold between 6090% of the inventory released to the market. Demand has been from both owner occupiers and investors, including bulk investors with the demographic profile of buyers, although varying from project to project is broadly 50% UAE Nationals, 20-30% Arab expats and the remainder spread across Western and Asian expats.

The first quarter of 2016 witnessed no new projects launched to the market, with developers including

Q-on-Q

0.0%

-1.0%

0.0%

0.0%

2.0%

0.0%

-4.0%

-2.0%

0.0%

-1.0%

-8.0%

Y-on-Y

0.0%

-4.0%

-8.0%

-7.0%

-7.0%

-4.0%

-4.0%

-4.0%

0.0%

-7.0%

-3.0%

1,775

1,750

SBR

Al Bandar

AVERAGE APARTMENT SALES PRICE AED/sq.ft. Q1 2016

1,150 City of Lights

925

1,275 Marina Square

Al Reef Downtown

1,325 Shams

950

1,395 Al Zeina

Al Ghadeer

1,400

500

Al Muneera

1,000

1,400

1,500

Gate District

2,000 2,250

AED/sq.ft.

2,500

St. Regis

0

Source: MPM Properties Research

10

| ABU DHABI REAL ESTATE MARKET OVERVIEW

REAL ESTATE SERVICES

Q1 2016

| RESIDENTIAL MARKET PERFORMANCE

APARTMENT RENTS „„

The residential market continues to see rent increases at lease renewals with the only exception to the common trend witnessed on Reem Island which has seen rents decline on renewals by up to 5% in some developments

more motivated to reduce rents to attract and retain tenants and thus cover mortgage and service charge payments Rents on new lettings have witnessed a marginal decline quarter-on quarter, highlighting that most high-end developments have reached an affordability ceiling following a period of sustained rental growth. Property managers still have a 10% delta in most towers between the minimum and maximum rents and we anticipate this delta to gradually narrow down during 2016

„„

„„

This is occurring due to this sub-market having had an injection of new supply of over 1,500 units in the second half of last year, (Gate Towers and Hydra Avenue), which are still being absorbed by the market

„„

This new supply increased competition for individual expat landlords which are typically

AVERAGE APARTMENT ANNUAL RENT Q1 2016 -1.0%

-1.4%

1.4%

-2.9%

-4.0%

-0.5%

-1.5%

0.5%

1.0%

3.7%

-2.4%

2.8%

Y-on-Y

0%

-2.0%

11.0%

3.0%

3.0%

4.0%

2.0%

0.0%

3.0%

11.0%

-5.0%

7.0%

55 75 105 135

100 115

160

235

Al Reef Downtown

185

Shams

70 87.5 110 137.5

190 72.5 92.5 135

72.5 97.5 135

Marina Square

80 102.5 145 177.5

Gate District

Al Muneera

115

120

Al Zeina 3 BR

Non-Investment Zone Grade B

2 BR

152.5 200

155 205

260 105 135

175

Al Ghadeer

St. Regis

45 62.5 75

1 BR

Non Investment Prime Zone

Studio

Al Bandar

155 105

SBR

120

175

195

220

265

Q-on-Q

Source: MPM Properties Research

11

Q1 2016

| RESIDENTIAL SECTOR

| ABU DHABI REAL ESTATE MARKET OVERVIEW

REAL ESTATE SERVICES

RESIDENTIAL SECTOR

VILLA PERFORMANCE: SALES AND RENTS „„

„„

Weak demand from buyers resulted in no sale price movement across most villa communities during Q1 2016. Al Reef villas, Al Raha Gardens and Gold Gardens witnessed a higher proportion of buyer interest with the majority of buyers being end users during the first quarter

Bloom. These developers are addressing the pent up demand from investors and end users for villas / townhouses between the price band of AED2.5 million to AED5 million Conversely, rental demand for villas over AED300k has slowed during the Q1 2016 with vacancy rates increasing during the first quarter of 2016. We anticipate this trend to continue during the rest of this year

„„

H1 2016 will witness multiple off-plan villa projects being launched by Aldar, TDIC and

Q-on-Q

0.0%

-1.79%

0.0%

0.0%

-1.52%

2.56%

0.0%

0.0%

Y-on-Y

0.0%

-9.24%

4.55%

0.0%

-2.99%

12.36%

-2.40%

-8.15%

1,375

1,150

1,050

1,000

975

815

620

Al Zeina

Al Ghadeer

AVERAGE VILLA SALES PRICE AED/sq.ft. Q1 2016

AED/sq.ft.

2,000 1,500 1,000

1,750

500

Source: MPM Properties Research

Hydra Village

Al Reef

Al Raha Gardens

Golf Gardens

SBV

Bloom Gardens

0

2 BR

3 BR

4 BR

Source: MPM Properties Research

12

237.5 250 270

300 350

235 295 340

190 230 265

215 277.5 320

5 BR

Al Mushrif Gardens

Al Bateen Gardens

Bloom Gardens

Al Raha Gardens

Golf Gardens

SBV

(Townhomes)

Hydra Village

100 115

240 270

Al Zeina

Al Reef

125 145 172.5 185

105 140 145

Al Ghadeer

600 500 400 300 200 100 0

360 395 450

VILLA AVERAGE ANNUAL RENTS Q1 2016

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

| RESIDENTIAL MARKET PERFORMANCE

VILLA VALUES – NON-INVESTMENT AREAS „„

„„

The analysis below is based on data gathered from the transactions financed by ADIB and managed by the MPM in non-investment zones and highlights the current prevailing prices and yields

anticipating distress sales, but have accepted the lack of such opportunities available in the current market „„

The market continues to witness a mismatch in yield expectations between sellers and buyers, which in turn is leading to a slow-down in transaction volumes. Most buyers were

Demand for good quality villa compounds in Khalifa City “A” and Mohammad Bin Zayed areas continue to be healthy at 8% gross yield with rents witnessing 3% to 5% growth, highlighting yield improvement potential over the medium term

VILLA COMPOUND PRICES (Q1 2016)

VILLA COMPOUND GROSS YIELDS (Q1 2016) 8.0%

20 15

9.0

10.75

12.5

7.3

14.1

21.0

14.72

7.45

6.3

5

22.0

7.0% 13.38

10

20.47

AED (Million)

25

0 Main island

KCA

High

MBZ

Low

6.0%

Shakbout City

Main island

KCA

MBZ

Shakbout City

Average

7/8 BEDROOM VILLA PRICES (Q1 2016)

25

25

20

20

High

KCA

Low

MBZ

Average

0

Main island

High

KCA

Low

10.37

6.75

14.0

15.07

7.15

5

10.8

10

23.0

15

5.46

6.5

6.8

7.0

Main island

6.65

0

6.66

5

4.2

10

13.5

20.0

15

16.17

AED (Million)

5/6 BEDROOM VILLA PRICES (Q1 2016)

9.13

AED (Million)

Note: Data relates to compounds of 4 to 6 villas

MBZ

Average

Source: MPM Properties Research

13

Q1 2016

| KEY INDUSTRY PLAYER - MARKET VIEW

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

PROJECT IN FOCUS – THE VIEW

Centrally Located High-end Residential Tower. The development occupies a prominent corner plot position within the Danet Abu Dhabi project, situated between Muroor Road and Airport Road. NO. OF APARTMENTS



250 Residences

NO. OF FLOORS



3B + G+ M+ 21 Typical Floors + Roof

NO. OF PARKING SPACES 350 RENTS

Studio starting from AED 75,000



1 Bedroom starting from AED 95,000



2 Bedroom starting from AED 140,000



3 Bedroom starting from AED 205,000

APARTMENT SIZES:

Studio

393 to 450 Sqft



1 Bedroom

839.28 to 871.56 Sqft



2 Bedroom

1581.72 to 1764.64 Sqft

3 Bedroom 2517.84 Sqft AMENITIES

Basement parking



Swimming Pool Health Club (Gym, Stream Room, etc.)

For more information, contact the MPM Agency Team

14

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

| KEY INDUSTRY PLAYER - MARKET VIEW

15

Q1 2016

| OFFICE SECTOR

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

MARKET OVERVIEW Q1 2016

OVERVIEW „„

The office market in Abu Dhabi shares a number of parallels with the residential sector in terms of supply and demand conditions

„„

Demand for office space in the Capital has always been driven predominantly by the government sector which has reduced spending on the back of lower oil prices and thus office expansion / relocation plans have been put on hold. However, as with the residential sector new supply is limited which is helping to sustain marginal rental growth levels within the Grade A segment of the market

„„

„„

MPM forecasts there will be just over 350,000 sqm of new offices completed by the end of 2016, however this comprises predominantly owneroccupier space including ADNOC HQ & ADIB HQ. The majority of new speculative office space entering the market in 2016 is at City of Lights on Reem Island, with the remaining floors at Addax Tower handed over this quarter and Omega Tower due to complete later in the year

operating as its own micro-market, is the Financial Free Zone on Al Maryah Island. Mubadala has released Al Sarab and Al Khatem Towers at ADGM Square which together extend to 98,000 sqm of Grade A space. In addition, Al Maryha Tower, owned by Al Hilal Bank is also now completed adding another 43,700 sqm „„

It is also likely that some companies currently leasing space at ADGM Square, but operating on the Abu Dhabi DED licence, will have to relocate from the free zone due to their onshore business activities, if dual licensing is not possible.

„„

The first two global financial institutions that have applied for an ADGM FSRA licence are Macquarie Capital Middle East and Aberdeen Asset Management (UK)

„„

Macquarie established offices in ADGM in 2013 whilst Aberdeen’s office in ADGM will be the institution’s first office in the Middle East

Contrary to the shortage of space available in the rest of the office market, and now effectively

ABU DHABI OFFICE SUPPLY (2011-2017)

NLA (in 000’s Sq.m.)

4,000 3,000

377

249

99

79

2,872

3,121

3,220

2013

2014

2015

42

3,299

3,356

3,693

2016 Q1

2016 Q2-Q4

2017

541

2,000 1,000

337

57

1,955

2,495

0 2011

2012

Running Total

New Supply Completed

Source: MPM Properties Research

16

Scheduled New Supply

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

| OFFICE SECTOR

ABU DHABI NEW OFFICE SUPPLY

NLA (in 000’s Sq.m.)

600 67

500 400

105

300

474

200

9

100

146

272

0

2010

180

45 203

18

19

47

60

10

157

81

2011

2012

2013

2014

2015

2016 Q1

2016 Q2-Q4

42

2017

Owner Occupation / Pre-Let

Speculative

Source: MPM Properties Research

ABU DHABI NEW OFFICE SUPPLY - LOCATION

NLA (in 000’s Sq.m.)

600 500 400

275 80

300 200

29

62

64

8

18

100 0

125

202

235

241

2010

2011

2012

2013

Off-Island

On-Island

63 5 12

42

2015

2016 Q1

2 13

81

2014

Investment Area

Source: MPM Properties Research

NEW SUPPLY BREAKDOWN - LOCATION (2010 TO DATE)

909

0

162

500

485

1,000

1,500

2,000

NLA (in 000’s Sq.m.)

On-Island

Off-Island

Investment Area

Source: MPM Properties Research

17

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

| OFFICE SECTOR

OFFICE RENTS „„

The office leasing market continued to witness limited leasing activity in Q1 2016

„„

With a shortage of Grade A office space available net effective rents have shown marginal increase at AED1,975 per sqm. Grade B stock has seen rents decline by 3% over the last three months, standing at AED 1,260 per sqm

„„

Requirements for larger spaces (1,000+ Sq.m.) have been virtually non existent with most companies adopting a cautious approach during Q1 2016.

Rent / Sq.m. (AED)

OFFICE HEADLINE RENTS, Q-ON-Q% AND Y-ON-Y% CHANGE Q-on-Q

2.6%

0.0%

-3.0%

Y-on-Y

6.8%

8.2%

5%

2,000 1,500 1,000

1,975 1,650 1,260

500 0 Grade A Fitted

Grade A S&C

Grade B

Q1 2016 Source: MPM Properties Research

OFFICE SALES „„

The office sales market continues to witness subdued demand as the SME sector, a key driver of demand has seen investment decisions put on hold

„„

A lack of public parking spaces on Investment zones for junior to mid-level staff continues to a negative factor impacting tenant demand with companies being reluctant to take space in these offices for this reason

Sales Price / Sq.ft. (AED)

AVERAGE OFFICE SALES PRICE Q-on-Q

0.0%

0.0%

4.3%

2.2%

4.5%

Y-on-Y

-4.9%



-8.0%

6.8%

4.5%

1,200

1,175

1,150

Addax

Tamouh Tower

Prestige Tower MBZ

1,500 1,200 900

1,450

1,250

600 300 0 Sky Tower

The Wave

Sales Price / Sq.ft.

18

Source: MPM Properties Research *as per UPC

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

| OFFICE SECTOR

OFFICE PROJECT IN FOCUS: ADIB HQ TOWER 2 „„

21,869 sqm of net leasable area arranged over ground and 12 upper floors

„„

Shell & Core finish ready for tenant fit out works

„„

4 levels of basement parking providing 400 car parking spaces (1:50 sqm)

„„

Additional parking available (subject to negotiation)

„„

Efficient floor plates extending to 1638 sqm

Grade “A” Specification „„

Common atrium with Tower 1 (ADIB HQ) with coffee shop and retail units

„„

2700mm finished floor to ceiling height

„„

Capacity for 200mm raised access floors

„„

8 high speed lifts dedicated to exclusively serve Tower 2 from B4 through to Level 12

„„

Average wait time estimated at 10-15 seconds

„„

LEED Gold for Building Design and Construction

„„

All common areas are covered by CCTV, access control system, fire alarm and intrusion detection system

Location The development is situated on Airport Road opposite the Hilton Hotel providing excellent connectivity to Downtown and the airport

Q1 2016

| RETAIL SECTOR

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

MARKET OVERVIEW Q1 2016

OVERVIEW „„

There have been no new retail developments completed in Abu Dhabi during the first quarter of 2016 and thus total retail stock in the Capital remains at approximately 2.4 million sqm of GLA

„„

This trend is set to continue over the next two years with no new retail schemes scheduled for delivery until 2018/19, when Maryha Central and Reem Mall are forecast to be completed, which will add over 400,000 sqm of new retail space to the market

„„

Mall revenues have been under pressure during the first quarter of 2016, with the outlook for the remaining year indicating further softening of consumer spending, leading to increased pressure on revenues. Property managers will have to carefully balance rent renewal rates, tenant churn rates and provide support to underperforming

retail brands, and maintain overall costs to ensure retail properties retain their attractiveness without significantly impacting the business objectives „„

Looking at the future outlook for retail space in Abu Dhabi from 2017 onwards the GOP and consumer confidence is expected to pick up, yet on-island property will quickly need to prepare for the increasingly competitive environment

„„

In this connection some of the existing malls in Abu Dhabi have already started implementing active asset management strategies with the view to repositioning and improving trading performance

„„

Online Internet retailing is now generating 1% of a $52+ billion market in the UAE, and expected to grow to 2% by 2020

ABU DHABI RETAIL SUPPLY (2009 - 2018+) 306

NLA (in 000’s) per Sq.m.

3,000 2,500

342

43

1

1,985

2,327

2,370

2,370

2014

2015

2016 Q1

2016 Q2-Q4

53

185

2,000

259

113

28

1,500 1,000 1,400

1,400

1,428

1,687

1,800

2009

2010

2011

2012

2013

2,533

2,586

2017

2018

500 0

Running Total

New Supply Completed

Source: MPM Properties Research

20

163

Scheduled New Supply

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

| RETAIL SECTOR

RETAIL SPACE CLASSIFICATION RETAIL SUPPLY PRE-2010

NEW SUPPLY DELIVERED 2010-2016 Q1

232,256 24%

303,277 22% 763,723 54%

147,000 15%

RETAIL SUPPLY AS AT Q1 2016

173,285 18%

232,256 10% 450,277 19%

517,394 53%

63,332 6%

333,000 24%

1,281,117 54%

409,953 17%

76,953 8%

District

RETAIL DEVELOPMENT PIPELINE

Neighborhood

752,000 76%

Regional

Super Regional

The above charts show supply of malls only and exclude all street retail. Figures are NLA (sq.m.)

RETAIL SPACE LOCATION PRE-2010

NEW SUPPLY ADDED POST 2010

RETAIL SUPPLY LOCATION AS AT Q1 2016

RETAIL DEVELOPMENT PIPELINE

236,241 24% 35,000 3%

300,609 13%

300,609 31%

123,417 13% 399,000 40%

471,753 20% 436,753 45%

1,601,241 67%

1,365,000 97%

On-Island

TAKE-UP & RENTS SPACE TYPE

AVERAGE RENT (AED) PA

Specialty Store

1,800-3,900 per sq.m.

Anchor Store (more than 1,000 sq.m.)

400-1,250 per sq.m.

F&B

3,500-5,750 per sq.m.

ATM’s

90,000-180,000

Kiosks

85,000-155,000

High street retail (Prime areas)

2,500 – 3,850 per sq.m.

High street retail (Non-prime areas)

1,550-2,850 per sq.m.

The rents quoted above are base rents excluding any turnover provisions and service charges.

Off-Island

465,700 47%

Investment Area

„„

Yas Mall had a foot-fall of 18 million customers during the full year 2015

„„

MPM research shows that footfall within Abu Dhabi’s existing shopping malls have remained broadly stable during the first quarter of 2016. However a reduction in consumer retail spending is impacting the trading performance amongst the retailers, which in turn is leading to retail tenant’s requesting rental reductions at lease renewal

„„

While the mall rents have been under pressure, high street retail rents have continued to increase at lease renewal with retailers on 3 to 5 year leases now facing the impact of the removal of the rent cap in 2013 for the first time, resulting in many retailers looking at more affordable options

21

Q1 2016

| HOSPITALITY SECTOR – TRADING PERFORMANCE

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

MARKET OVERVIEW Q1 2016

In Q1 2016, only one new hotel (Al Seef Resort) entered the market adding 210 rooms. Supply in the hotel sector is expected to increase by 2,853 keys by the end of 2016. New hotels scheduled for completion this year include Four Seasons, Marriott, Grand Millennium Bab Al Qasr Hotel and Emirates Pearl.

Abu Dhabi Tourism and Culture Authority and Miral have announced that the $1 billion Warner Brothers theme park on Yas Island will open in 2018,which along with the Louvre on Saadiyat Island will act as a major tourism driver.

70%

400

60%

300

50%

200

40%

100

30%

0

20%

ARR

Mar

500

Jan 16

80%

Jul

600

Jan 15

90%

Jul

700

Jan 14

100%

Jul

800

Jan 13

Average room rate

HOTEL ESTABLISHMENT PERFORMANCE HISTORICAL TRADING PERFORMANCE 2010-2016

Occupancy

RevPAR

Source: TCA Abu Dhabi and MPM Properties Research

Number of rooms

ABU DHABI HOTEL ROOM SUPPLY (2009 - 2017+) 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0

3,357 2,599 2,805 2,653

1,835

2,312

2,646 5,374

8,278

8,278

Pre 2009

2009

2,397

13,652

16,049

18,695

2010

2011

2012

Running Total

21,348

2013

23,660

2014

New Supply Completed

Source: MPM Properties Research

22

213

26,465

2015

28,300

2016 Q1

28,513

31,112

2016 2017+ Q2-Q4

Scheduled New Supply

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

| HOSPITALITY SECTOR – TRADING PERFORMANCE

Q1 2016 – HOTEL APARTMENT SCHEDULED COMPLETIONS S.NO.

ESTABLISHMENT NAME

EXPECTED CLASS

OPENING

ROOMS

1

Al Seef Resort & Spa by Andalus

Deluxe

Q1 - 2016

210

TOTAL

210

GUEST ARRIVALS Q1 2016 YTD

United Arab Emirates

37%

Other GCC Countries

8%

Other Arab Countries

10%

Asia (Except Arab)

21%

Australia & Pacific

1%

Africa (Except Arab)

1%

Europe North & South America

17% 5%

GUEST ARRIVALS – TOP 5 RANK

NATIONALITY

2016 YTD

2015 YTD

GROWTH RATE %

1

United Arab Emirates

226,883

205,036

11%

2

India

47,064

37,116

27%

3

China

45,555

46,464

-2%

4

United Kingdon

36,613

36,008

2%

5

USA

25,638

27,081

-5%

Source: TCA Abu Dhabi and MPM Properties Research

23

Q1 2016

| DEFINITIONS & METHODOLOGY

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

DEFINITIONS & METHODOLOGY RESEARCH STUDY AREA The geographic extent of the study area covers the key districts in Dubai.

the parties. The rents quoted are also exclusive of service charges.

RESIDENTIAL

RETAIL

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.

New retail developments are classified as delivered and thus entered into the new supply category when the first units are open and trading.

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

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

24

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.

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

Q1 2016

A collaborative team providing our integrated services PAUL MAISFIELD BSC (HONS) MRICS CEO T: +971 (0)2 610 0545 M: +971 (0)50 660 9437 [email protected]

YOUSEF AL ZAROONI Regional Head – Al Ain T: +971 (0)3 708 8636 M: +971 (0)50 600 1002 [email protected]

ABDULLAH SAID AL KUWEITI Business Development Director T: +971 (0)2 610 1554 M: +971 (0)50 623 5854 [email protected]

ALI ABDULLAH ABDUL RAHMAN Acting Regional Head – Northern Emirates T: 971 (0)6 597 2514 M: +971 (0)50 656 2486 [email protected]

VAIBHAV SHARMA MCOM; MDBA Director of Strategic Advisory and Research T: +971 (0)2 412 8914 M: +971 (0)50 660 9295 [email protected]

SAMUEL MORRIS BSC (HONS) FRICS Director of Valuation & Regional Head - Dubai T: +971 (0)4 371 9466 M: +971 (0)50 107 1704 [email protected]

FRANK O’DWYER MBA (Hons); BEng. COO T: +971 (0)2 610 0402 M: +971 (0)50 812 1070 [email protected]

DOMINIC BARLOW Head of Retail, Hospitality & Leisure T: +971 (0)2 510 0655 M: +971 (0)56 288 1458 [email protected]

KHALED CHAHAL Director of Agency – Abu Dhabi T: +971 (0)2 412 8402 M: +971 (0)50 110 2929 [email protected]

PRADEEP FERNANDES MRICS Advisory & Valuation Manager T: +971 (0)2 510 0663 M: +971 (0)55 961 3626 [email protected]

WAHIDA KARAMA Head of Property Operations T: +971 (02) 610 0435 M: +971 (0)50 765 7679 [email protected]

JUBRAN AL HASHMI Head of Property Services T: +971 (0)2 610 0232 M: +971 (0)50 122 0041 [email protected]

JASON FIELDEN BSC (HONS) MRICS Valuation Manager - Abu Dhabi T: +971 (0)2 510 0653 M: +971 (0)56 244 7696 [email protected]

MOHAMED AL ZOUBI Head of Development Advisory BSc Civil Engineering T: +971 (0)2 610 0564 M: +971 (0)50 310 3570 [email protected]

25

Q1 2016

| SUPPLY - PHOTO GALLERY

REAL ESTATE SERVICES

| ABU DHABI REAL ESTATE MARKET OVERVIEW

SUPPLY - PHOTO GALLERY NON INVESTMENT AREA - UPCOMING SUPPLY 29

BLOOM CENTRAL AIRPORT ROAD

28

FOUNDATION PROPERTIES AIRPORT ROAD

32

REGENT EMIRATES PEARL HOTEL

OMEGA TOWER REEM ISLAND

38

FAIRMONT HOTEL

ANSAM YAS ISLAND

43

BLOOM GARDENS - PHASE 3 (147 VILLAS)

30

ABU DHABI MARINA

31

THE BILTMORE HOTEL

SAMPLE OF NEW & UPCOMING SUPPLY NEW SUPPLY (Q1 2016) 1

AL SEEF VILLAGE RESORT AND SPA

2

BLOOM GARDENS PHASE 2 (55 VILLAS)

3

4

UNB TOWER C39 DANET

5

C41 ALI & SONS RAWDHAT

THE WAVE REEM ISLAND

6

RESIDENTIAL BUILDING MUROOR 33

BAB AL QASR HOTEL BY MILLENNIUM

34

LINK INTERNATIONAL PROPERTIES, CORNICHE

35 AL JAZEERA TOWER CORNICHE

36

AWQAF BUILDING KHALIDIYAH

37

MARINA SUNSET BAY

INVESTMENT AREA - UPCOMING SUPPLY 7

FOUR SEASONS HOTEL, AL MARYAH

12

SHEIKH OMAR TOWER REEM ISLAND

17

ENI SHAMS TOWER REEM ISLAND

23

M TOWER REEM ISLAND

8

LAMAR RESIDENCES RAHA BEACH

13

18

24

9

RDK TOWERS NAJMAT

YASMINA RESIDENCE REEM ISLAND

LEAF TOWER REEM ISLAND

SHK FAISAL, RAHA BEACH

14

19

25

10

UNB TOWERS, REEM ISLAND

PARK VIEW TOWER REEM ISLAND

SKY GARDENS REEM ISLAND

20

SEA FACE TOWER

26

HORIZON TOWERS REEM ISLAND

15 WAFRA COMMERCIAL TOWER

21 THE KITE RESIDENCES

NALAYA VILLAS, NAJMAT REEM ISLAND

11

16

39

22

AL QURM VIEW REEM ISLAND

46

C104/C105 RESIDENTIAL BUILDINGS RAWDHAT

27

AL HADEEL AL RAHA BEACH

51

C35 AL SARAYA RESIDENTIAL TOWER

52

FIVE STAR HOTEL NAVY GATE

41

THE VIEW C38 DANET

44 C74/C75/C76 RESIDENTIAL DEVELOPMENT RAWDHAT

47 C83 COMMERCIAL BUILDING, RAWDHAT

AL JOWHARA TOWER SARAYA

40 ADTC PHASE 3

53

45

48 C70 EMIRATES LAND GROUP RAWDHAT

HARD ROCK HOTEL SARAYA

42

54

C60 COMMERCIAL BUILDING RAWDHAT

49 THE VIEWS 1 & 2 SARAYA

MINA TOWER SARAYA

55

AL QUDRA COMMERCIAL BUILDING IN DANET C55

50 C34 AL NAHDHA SARAYA

HILTON HOTEL AL FORSAN

REAL ESTATE SERVICES

Hydra Village

Q2 2014 NEW SUPPLY

40 39

Th

6

E

Hotels

16

26

Al Reef

F

31

t

G

1

St

A

25 th

lS

d aa

Airpo

43 2

rt Rd 41

Salam 42

3

Al

Stree

t

H Abu 4

Khal

eej A

44 46 47 4845

l Ara

Salam

iDhab

27

E 10

i Rd

Duba

Masdar City

I

Stree

t

bi St

reet E 20

COMMON TREND (Q1 2016) (ANNUAL % RENTAL INCREASE)

9

ch

Bea Raha 8

e tre

aS

ADIB RENTAL INDEX ZONE

Hotels

eet Str

d tR

30

Non-investment

lam

29

Z

32

Retail

Yas Island

Sa

St

or

ed ay

st

ir eF

rp Ai

33

B

Retail

28

c

Ele

Investment

13 14 12 15 5

D

St tra36

Offices

55

E 20

Q-Q CHANGE OVERALL AVERAGE Q1 2016

Q4 2015

Q3 2015

Q2 2015

Q1 2015

Q4 2014

Q3 2014

Q2 2014

Q1 2014

3.52%

3.06%

3.05%

4.58%

3.71%

8.05%

5.01%

2.37%

4.05%

Zone B

0 to + 4.99%

3.38%

4.33%

2.60%

5.08%

6.94%

7.75%

10.56%

3.86%

6.33%

Zone C

0 to + 4.99%

6.05%

5.94%

5.63%

7.46%

9.25%

9.79%

12.34%

10.26%

5.06%

Zone D

0 to + 4.99%

7.01%

7.05%

6.48%

7.06%

8.51%

10.31%

10.26%

9.07%

6.18%

Zone E

0 to + 4.99%

9.34%

7.35%

3.76%

4.02%

7.54%

5.09%

10.20%

5.32%

4.49%

Zone F

0 to + 4.99%

3.33%

5.62%

4.77%

3.17%

4.01%

6.58%

7.63%

3.25%

2.41%

Zone G

0 to + 4.99%

0.46%

1.91%

4.42%

2.34%

2.20%

2.59%

2.69%

2.42%

2.92%

Zone H

0 to + 4.99%

2.77%

3.85%

3.68%

5.58%

3.46%

1.46%

3.42%

5.31%

2.44%

Zone I

0 to + 4.99%

2.22%

2.36%

3.08%

3.41%

1.86%

5.48%

1.14%

1.33%

1.21%

Zone J

0 to + 4.99%

4.12%

1.87%

3.32%

5.78%

0.96%

4.04%

3.06%

1.55%

1.64%

Zone K

0 to + 4.99%

4.05%

6.10%

5.30%

5.89%

2.88%

4.31%

4.18%

3.51%

3.65%

2

0 to + 4.99%

E2

Zone A

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Al Maryah Island 10 11 24 Al Reem 25 Island

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UNDER CONSTRUCTION Q1 NEW & UPCOMING SUPPLY

Ab uD ha bi -

E12

| ABU DHABI REAL ESTATE MARKET OVERVIEW

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E 11

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Q1 2016

INTEGRATED SERVICES COVERING THE FULL PROPERTY LIFECYCLE Property Management

Valuation

Enhancing value for individual & institutional property owners:

Project Management and ESCROW

Valuation reports for: „„

Mortgage & Loan Security

Complete Project Management services at planning & construction stage:

„„

Prompt leasing & debt collection

„„

Securing Project Funding

„„

Engineering Review & Scheduling

„„

Effectively market & lease vacant units

„„

Internal Accounting

„„

Cost Estimate & Procurement

„„

„„

Physical & technical maintenance of asset

Mergers & Acquisitions

Project Monitoring

„„

„„

Investment appraisal

„„

Cost Control & Accounting

„„

Litigation

„„

Assist with Permits & Licensing

„„

Inheritance

„„

Ensure appropriate fund movement for Escrow based on Project Assessment

„„

Maintain tenant satisfaction

„„

Timely lease renewals

„„

Manage risk, insurance & litigation

„„

Protect your interests and enhance value

We cover all asset classes. Our reports are in compliance with the International Valuation Standards (IVS) and the RICS Professional Valuation Standards.

Agency (Sales & Leasing)

Research & Strategic Advisory

We work with developers, commercial tenants, retailers and individuals, offering:

Bankable studies for your real estate and business needs:

Investment Advisory

Aiding developers and investors to maximize value:

„„

Highest & Best Use

„„

Investment Advisory & Due Diligence Investment Management

„„

Launch Strategy

„„

Market & Financial Feasibility

„„

„„

Project Launch Handling

„„

Development Strategy

„„

Disposal Strategy

„„

Project Marketing Events

„„

Market Research

„„

Portfolio Review & Optimization

„„

Acquisitions

„„

Corporate Real Estate Strategy

„„

Deal Structuring & Capital Sourcing

„„

Leasing

„„

Master-plan and design review

„„

Investment Sale

„„

Sales

We cover all sectors, including residential, commercial, industrial, retail, and land.

PAUL MAISFIELD BSC (HONS) MRICS CEO T: +971 (0)2 610 0545 M: +971 (0)50 660 9437 [email protected]

VAIBHAV SHARMA MCOM; MDBA Director of Strategic Advisory and Research T: +971 (0)2 412 8914 M: +971 (0)50 660 9295 [email protected]

ABU DHABI HEAD OFFICE

DUBAI OFFICE

AL AIN OFFICE

SHARJAH OFFICE

6th Floor, Al Wahda Tower P.O Box 114686 Abu Dhabi

Office 004 - Level 100 Arenco Tower, Dubai Internet City Dubai

201-204 ADIB Ladies Branch Building Oud Touba Street Al Ain

AL Ikhlas Tower AL Khan Shajrah

Tel. +971 2 610 0252 Fax. +971 2 610 0514

Tel. +971 (0)4 371 9462

Tel. +971 (0)3 703 9521

Tel. +971 (0)6 597 2555

www.mpmproperties.ae