MIDEAST MONEY-Tenants become investors as Abu Dhabi engineers property rebound ABU DHABI, Feb 19 (Reuters) - For years, Abu Dhabis real estate market has paled next to its more dynamic, glamorous rival in neighbouring Dubai. But that may be changing as Abu Dhabi engineers a market recovery that could attract billions of dollars of fresh foreign investment. Real estate prices in Dubai jumped over 20 percent last year, analysts estimate, as the emirate rebounded from a crash in 2008-2010 which slashed prices by more than 50 percent from their peaks. Equally dramatic, though less well publicised, was last years rebound in Abu Dhabis property market, which suffered similar damage during the global financial crisis. Prime residential sale prices in Abu Dhabi jumped 25 percent and rentals climbed 17 percent in 2013, real estate advisory firm Jones Lang LaSalle estimated. Real estate services firm Asteco said apartment sales prices rose 29 percent in the fourth quarter of last year over the same period of 2012. Much of Dubais recovery has been due to an influx of foreign money as the emirates trade and tourism industries boom. By contrast, Abu Dhabis rebound appears to have been triggered by clever government intervention in the market. By altering the dynamics of its property market, the emirates government may succeed in making Abu Dhabi real estate more competitive with Dubai and lure some of the money pouring into the United Arab Emirates from the Gulf, India, China and elsewhere. A cross section of investors are focused on Abu Dhabi - people from Dubai with cash are coming here because yields are stronger, Gurjit Singh, chief development officer at Aldar Properties , Abu Dhabis largest real estate developer, said last week. POPULATION Abu Dhabi and Dubai have similar populations of just over 2 million, but Dubai has traditionally had a much more active and open real estate market. This is partly because Abu Dhabi developers have focused on villas for rich locals, limiting supply of high-end apartments favoured by foreign investors. The shortage may explain why, according to Jones Lang LaSalle, average apartment prices are 1,190 dirhams ($325) per square foot in Abu Dhabi, only marginally below 1,220 dirhams in Dubai.
Posted on: Mon, 03 Mar 2014 18:39:40 +0000
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