What are the top 5 cities that have attracted MENA investor interest in 2021?
Deep diving into the region, the main cities we see investors prioritising today are Dubai, Abu Dhabi, Cairo, Riyadh, and Muscat.
It’s no coincidence that the UAE features so strongly in this list as it was one of the first countries worldwide to successfully mitigate the effects of the pandemic and find a pathway to growth. Several factors have increased the demand for property in the UAE, such as high lending rates, improved business conditions, flexible residency rules, easing administrative procedures, and advancements in security and technology.
The KSA has recently taken a bold step towards economic openness and has made progress in encouraging foreign investment into the Kingdom. The plans to open 480 international companies’ headquarters in Riyadh over the next 10 years will continue to increase the demand for real estate, notably office and industrial space in the region. Furthermore, the Saudi government’s aim to increase the percentage of Saudi families owning homes to 70% by 2030 will help drive the residential sector in the foreseeable future.
The governments in Egypt and Oman are equally putting in place initiatives to boost the real estate industry in both countries, such as the Administrative Capital project in Cairo and the Investor Residence program in Oman which have already attracted investor attention.
What offerings do these cities provide to MENA investors?
Despite the many superficial differences, these cities all offer advanced infrastructure, safety and a certain degree of luxury and sustainability throughout their respective markets. Each propose long visa residence systems and 100% business ownership for foreign investors and offer strong governmental support for the sustainable and profitable growth of various investment sectors.
Most investors, whether working, vacationing or even retired to these locations, want that ‘15-minute’ lifestyle, if they can get it. They want walkable convenience, amenities and authentic properties that allow them to live fuller lives without necessarily having to get into a car and transition from one segment of their life to another – and they want to be able to get rental income when the property is vacant.
Which asset class are UAE-based investors seeking?
The majority of real estate investors in the UAE are interested particularly in the residential real estate sector, for example villas and luxury apartments, for which we have seen demand increase rapidly over the past few months.
Aside from the residential sector, retail and office space, educational and health properties, hotels, and entertainment and hospitality real estate are all emerging as in-demand sectors amongst investors in the UAE currently.
Due to the foresight of the government, the UAE has led the world in COVID testing and vaccinations, and this fast recovery is building a solid ground for development and growth on a healthy pace in the real estate sector.
What are some of the key drivers of investment into the UAE?
Dubai ranks as the 11th most popular city globally for residence-by-investment programmes, and EXPO 2020 is playing a major role in both attracting attention and driving impressive investment to the UAE.
The growth of the monthly sales transactions and their values leading up to EXPO 2020 has been exceptional, but none as significant as September 2021, which not only had the highest value of real estate sold in a single month since December 2013, but also crossed the AED 117 billion mark with 48,490 sales transactions for the year so far.
A major contributor to this amazing growth is a diverse and strong economy and flexible rules and regulations.