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Abu Dhabi realty market remains stable in Q1

Abu Dhabi - JLL reported that Abu Dhabi's real estate markets have generally been stable during the quarter

Real estate investment and advisory firm JLL on Tuesday released its first-quarter Abu Dhabi Real Estate Overview report, which assesses the latest trends in the office, residential, retail and hospitality sectors.
JLL reported that Abu Dhabi's real estate markets have generally been stable during the quarter, in spite of the continued impact of lower oil prices and a reduction in domestic government spending. While demand has reduced, supply completions have also reduced compared to previous years, leading to relatively stable market conditions.
David Dudley, international Director and head of the Abu Dhabi office at JLL Mena, said: "The general trend this quarter and indeed last year has been relative stability - characterised by low vacancy rates in high quality stock and prime rents generally remaining stable across each asset class."
"The good news is that, while we are going through a period of weaker demand, supply completions are at a 10 year low - due to developers remaining cautious, tightened liquidity and more extensive regulation - leading to smaller-scale releases and developments being phased over time."
any of the large-scale development releases during the 2007 to 2008 upswing were oversized and took a long time to be absorbed during the subsequent downturn. So having smaller digestible phases aligned to demand is a good thing, signifying a maturing and more sustainable real estate market."
Total office stock reached approximately 3.4 million sqm of gross leasable area, or GLA, during the first quarter of 2016, with the only delivery being Al Maryah Tower on Al Maryah Island adding approximately 43,700 sqm of office GLA. An additional 286,000 sqm of GLA is expected to be delivered by the end of 2016. Demand for office space has reduced due to the decline in oil prices directly impacting the oil-related sector and indirectly impacting other sectors due to a slowdown in government spending. Large-scale requirements continue to be driven by the government sector and state-owned enterprises with the bulk of private sector demand focused on smaller office suites.
In the residential segment, a total of 719 units were delivered in Abu Dhabi during the first quarter, bringing the total residential stock to approximately 246,000 units. Deliveries include Amwaj 2 in Al Raha Beach, Al Falahi Tower in Danet Abu Dhabi and The Wave Tower on Reem Island. Approximately 4,000 units are expected to enter the market by the end of 2016 mainly within Danet Abu Dhabi, Reem Island and Saadiyat Island.
In retail, no major completions took place during the first quarter of 2016, keeping the stock at approximately 2.6 million sqm of GLA. Approximately 63,000 sqm of retail GLA is expected to be delivered by the end of 2016 primarily within mixed-use developments.
In hotels, there were no major hotel openings, with the principal opening being 213 serviced apartment units within Andalus Al Seef resort and spa in the Grand Mosque Area. An additional 3,300 hotel rooms are expected to enter the market by the end of 2016 with the opening of the Grand Millennium Bab Al Qasr, Gloria Downtown, Marriott, Fairmont Marina and Grand Hyatt hotels. Most of these properties will be positioned in the four- and five-star categories, further skewing the market towards the upscale to luxury segment. - business@khaleejtimes.com