Business | Property
End-users keep Marina West right on track
Gated beachfront community successfully wards off recession fallout, attracting steady investor interest from Bahrain and Saudi Arabia
- by Daniel Thomas, Page Editor, Property Monthly
- Published: 00:00 January 1, 2010
- Image Credit: Supplied
- Construction progresses on the Marina West development. Investors have bought about 60 per cent of the units released for sale in seven of the eleven high-rises in the community
Pitching principally to an end-user clientele has well served Marina West, one of Bahrain's larger gated beachfront community developments. The steady investor interest has also played its part in keeping the project, launched in March 2007, on track to meet its completion schedule.
"The financial crisis has no doubt affected Bahrain's property market, however there are no sharp declines that have been reported, mainly because real estate in the country has been largely backed by Islamic banks, which have not suffered for the most part from the credit crunch," insists Mahmoud Janahi, CEO of Marina West. "It has been noticed that buyers are mostly end-users, first-time homeowners."
The latest numbers reveal that nearly 60 per cent of the units released for sale, spread across seven high-rises, have been bought. Three additional towers are yet to hit the market, but will do so only on project completion. Besides these, one tower has been acquired by an independent investor. "Ever since we started, there were plenty of potential buyers, especially from the Saudi market," says Janahi.
For sure, location advantage does play a large part in keeping sales high. Marina West is in close proximity to the King Fahd Causeway, a fact that the developer is not shy to let investors know. "We could attract potential buyers who would love to live in Bahrain and work in Saudi Arabia."
Marina West's show apartment is getting a lot of attention, with at least 20 visitors a day, quite impressive as this has come in the last quarter of 2009 and at a time when the wider market conditions were none too conducive for property buys.
Janahi rules out a slowdown in non-Bahraini buyer interest as a result of the current market situation. "We are still getting Bahraini families who are interested in Marina West. Bahraini nationals make up 30 per cent of the potential clients, while another 30 per cent constitute Saudi nationals. Up to 40 per cent belong to other nationalities — expatriates from both Bahrain and Saudi Arabia."
But mortgage availability has become tighter in the region and lenders are putting in place significantly higher loan provisions than a year or two ago. On this score, the developer does not foresee any need for undue alarm.
"We currently have a number of banks offering property financing solutions for our customers, whether they are employees or self-employed individuals, Bahraini nationals or expatriates," says Janahi. He cites Islamic as well as conventional deals being offered by entities such as Bahrain Islamic Bank, Ahli United Bank, BMI Bank and Reef Real Estate Finance Co. to prove this is indeed the case.
Early investors gain
For investors who managed to get on-board early enough, units were made available at fairly competitive rates. "Before the project was officially launched, we offered apartments at the first stage at considerably low rates. For instance, an apartment that costs 90,000 Bahraini dinars right now was sold for 45,000 dinars three years ago."
A residential visa for the buyer forms part of the sales agreement. Once an apartment is registered and delivered, the purchase is entitled to a residential visa until the property is re-sold to someone else.
While much confusion exists over the strata management process across the various developments in the region, Marina West has put in place an agreement with BCS Bahrain, a joint venture with Prudential Investment Company of Australia.
"The strata management is known as ‘body corporate management' in Australia, and here as ‘owners association management'. This looks after the day-to-day running of the administrative, financial and secretarial aspects of the owners association, in addition to arranging the maintenance and upkeep of the common areas and facilities owned by the association," Janahi adds.
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