Post-oil era for Abu Dhabi: Focus on real estate?
A new property law will benefit real estate growth in the capital of Abu Dhabi, industry experts said, calling for a measured response over the impact of a potential oil output freeze deal.
“Increased clarity and transparency alongside centralisation of property and mortgage registration, the management of escrow accounts, and the creation of a mortgage law effectively reduces the risks involved in real estate transactions for all parties,” Chris Taylor, CEO of Abu Dhabi Finance said.
“Expat residents will be more likely to invest long-term in the market and non-resident customers will take great comfort from these new laws. The Property Law will lessen the impact of potential cyclical economic factors such as oil price movements on real estate prices creating a less volatile environment which should encourage continuous investment and growth of the sector,” Taylor added.
Regulation of Real Estate Sector in Abu Dhabi, the recently implements law, is set to be one of the core topics discussed at the upcoming Abu Dhabi Market Overview, set to take place on the first day of Cityscape Abu Dhabi, which runs from April 12 – 14 at the Abu Dhabi National Exhibition Centre (ADNEC).
The forum will also highlight Abu Dhabi’s residential market capacity and the impact a potential oil output freeze could have on the real estate sector.
David Dudley, international director and head of the Abu Dhabi Office at JLL MENA, also believes the current status of real estate market in the context of the Property Law will bring many opportunities and higher financial security for investors.
“New regulations affecting escrow accounts, land and property registration, strata law, the licencing of real estate activity and new fees will help support a better regulated market as they will improve transparency and help protect consumers as well as investors,” Dudley said.
“The new laws place greater responsibility and regulation on developers, which will inevitably suppress supply growth. This will help reduce the risk of over-supply in the current period of weaker demand; however the key will be to allow sufficient supply to come through to maintain a healthy balance between supply and demand to keep rents and prices at a competitive level,” Dudley added.
The Abu Dhabi Market Overview will also see experts debating the potential impact of recent oil output freeze on the capital’s economy. While oil price and production volumes have always been a key driver of Abu Dhabi’s economy and real estate markets in generating a significant proportion of GDP, FDI, employment and consumer spending, Dudley points to positive aspects of the current slowdown.
“The good news is that demand growth continues from major capital projects that started when oil revenues were strong. Projects such as the airport expansion, the growth of Etihad Airline and other major tourism attractions, including The Louvre Abu Dhabi have an economic multiplier effect, ensuring continued GDP growth,” he said.
Other prominent speakers at the conference include Cyrill Lincoln, Head of Real Estate at ADCB, and Fergal Harris, Global Head at Real Estate & Family Conglomerate at NBAD.
Cityscape Abu Dhabi has established itself as the UAE capital’s largest and most influential property investment and development event over the past 10 years. With hundreds of developments from Abu Dhabi and overseas showcased, the event brings together investors, developers, government officials and real estate professionals.