Sharjah Real Estate most stable in the region

Having recently opened up its real estate market to foreign investors who can now own properties in the emirate for up to 100 years, Sharjah real estate is set to witness an unprecedented boom. The Tilal City project, which was welcomed by investors and marked the beginning of a new era in Sharjah real estate has seen immense progress and demand. Launched in November 2014 as a joint venture between Sharjah Asset Management and Eskan Real Estate Development, the flagship Sharjah property project covers an area of 25 million square feet along Emirates Road. It is the first model community of its kind in the city. In addition, it is also the first development available on a 100-year leasehold basis for all nationalities.

Soon, Tilal Properties will also unveil the Tilal Mall project. This development is expected to add to the retail appeal of the emirate and cater to the shopping needs of residents in Tilal City and neighbouring areas.

More importantly, as a burgeoning real estate destination, Sharjah was least hit by the economic downturn of 2008. Demand, supply and prices of Sharjah properties continue to remain stable and affordable, thereby gaining the confidence of investors and representing a safety valve for the UAE real estate market. Moreover, the market is also being well regulated to guarantee the rights of all the parties involved, including developers and investors. For instance, the Sharjah Real Estate Registration Department, recently announced its plans to launch a new service that allows customers to enter the data of initial contracts for real estate deals via smartphones. This will make the data available in the circuit systems and make it easier for dealers to complete the final procedures when they go to the Department.

Aside from Tilal City, Sharjah real estate is set to welcome a series of new real estate projects, including industrial, commercial and residential ones, such as the Sharjah Expo Hotel, which when launched, is expected to become an architectural and iconic masterpiece and a transformative hotel stay experience for business and leisure travellers. Given its strategic location, the hotel will be ideal for corporate executives visiting the various exhibitions held at Expo Centre Sharjah.

Sharjah Holding is another landmark initiative and the result of a strategic partnership between the Government of Sharjah and Majid Al Futtaim Properties. Matajer, a neighbourhood retail concept anchored by a leading supermarket chain and featuring a range of premium retail, food and beverage brands and Al Zahia, an integrated residential community featuring a range of villas, apartments and commercial units have been launched as part of this initiative with ongoing expansion plans slated for the year. Explore the latest Sharjah properties on bhomes.com. Click here to get started.

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UAE Real Estate Events in 2016

One of the key UAE real estate events this year was the passing of the long-awaited legislation to better regulate the Abu Dhabi property market. The new law (Law No. 3 of 2015) is a positive step towards standardising practices in the capital’s real estate environment and in turn, increase real estate/property investment in the emirate and across the UAE. The law also looks to tackle the myriad of concerns raised by investors and developers while drawing on the investment experience and landscape of Dubai. Hence, this regulation is considered an important step forward as a source of legal protection for stakeholders.

A key trend that we think will define this year’s UAE real estate market is tightening liquidity. With oil prices remaining low, we think that a general tightening of liquidity will impact real estate/property investment in 2016. Thus, conventional project financing such as bank lending may become difficult, driving developers to seek alternative funding mechanisms such as joint ventures, refinancing, etc. Functionality is likely to emerge as an important factor for occupiers in search of new office spaces. While overall levels of demand are expected to be lower than last year, buildings that offer efficient working environments and other services such as sufficient parking with access to public transport will remain in demand.

 The hospitality industry is all set to evolve and change as overall demand softens this year. As Dubai’s core luxury UAE real estate market transforms into a more broad based hospitality offering, how to operate and gain profitability in 2016 remains to be seen. Another trend that can be expected to emerge this year is a renewed focus on adding value to existing buildings rather than developing new ones. This change is resulting in an increase in demand for fit-out within retail, office and hospitality projects. Occupiers are re-examining their fit-outs as a more cost effective option than moving to a brand new space. Conversely, there seems to be less demand for iconic or less functional buildings.

Moreover, this year, we expect to see a modest rate of growth as the overall economy adjusts to a sustained period of lower oil prices. While new real estate/property investments are in the pipeline, most of this supply is being phased over many years, not in 2016. As people realise that double-digit quarterly or annual price growth are not here to stay, market sentiment and confidence will increase, leading to more transaction activity and healthy and sustainable price appreciation in the UAE real estate market.

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