DOHA: Rents of properties, especially for residential units and commercial spaces, are expected to come down further this year. The correction in the rents will be largely driven by additional supplies as nearly 9,000 housing units and several malls are expected to be ready during this year.
The supply projections for 2018 have been adjusted upwards to 8,800 units, due to delayed deliveries from 2017.
The rents for residential units and office space in the fourth quarter of last year (Q4, 2017) witnessed an estimated decline of 4 percent and 2 percent, respectively.
“Rents in Doha are expected to witness further corrections due to increasing number of project handovers,” noted a ‘2018 Outlook’ released yesterday by ValuStrat, a leading advisory firm.
On rents for office spaces the firm said that the influx of supply in Lusail City will continue to depress rental rates, unless there is an uptick in demand or a large number of users in secondary locations move to occupy offices in Lusail.
In the retail sector, several upcoming malls such as Place Vendome, Boulevard Mall, Doha Mall and Katara Plaza, will add more space to the existing supply in the market. Currently, the overall organised retail space stands at approximately 1.3 million square metres.
Regarding the hotel sector, several new hotels are expected to be completed this year, which include Salwa Resort (next to Aqua Park), Grand Mercure Hotel, Zulal Wellness Resort, Ezdan Palace, M Gallary Boutique Hotel, Panaroma Residences and Suitesand Dusit Hotel and Suites.
Minor Hotels Group is developing two properties in Doha and one in Al Wakrah, to add 350 new keys in 2018. Luxury waterpark and four star hotel launched in Qetaifan Island. Lusail by Katara Hospitality, to be completed by 2020.
Total number of hotel keys has already reached 25,600 across 141 establishments. Manateq, the state-backed Economic Zones Company, Qatar, last year announced QR488.5m investment for a number of hotles and other hospitality projects in Ras Bufontas Economic Zone.
Citing data from International Monetary Fund (IMF), ValueStart noted that the Qatar economy projected to witnessed a real GDP grow of 3.1 percent. Inflation rate is estimated to remain modest and current account deficit is expected to reduce on the back of increased hydrocarbon revenues. Oil prices are expected to increase to an average $56 per barrel.
This robust economic growth is based on the steady rise in the country’s population, which according to the World Bank, is projected to reach 2.69 million in 2018.
Commenting on the 2018 state budget, it said that the government has earmarked projects related to 2022 World Cup and sectors such as food security, infrastructure, small and mid-sized enterprises (SMEs), tourism sector and economic and free zones. Based on anticipated oil price recovery and government support the downward trend experienced in real estate sector is projected to stabilise.
