Dubai: Dubai retained its status as the most “transparent” regional property market for global investors, but the biggest improvement has been for Qatar, according to the ‘Global Real Estate Transparency Index’ for 2014 released by the consultancy JLL.
Dubai was ranked 49th in the JLL findings with a composite score of 3.11, while Abu Dhabi was 53rd with 3.20. These scores placed in the list of countries rated as being ‘semi-transparent’, while the UK, the US and Australia were the top three ranked countries and with ‘high transparency’. (The composite score is made up of five sub-indices such as ‘performance measurement’, ‘market fundamentals’, ‘governance of listed vehicles’, ‘regulatory and legal’, and transaction process.)
The transparency parameter determines how an investor with substantial funds at his disposal assesses the ease of an entry into – and exit from - a particular market. Since 2008, Dubai has sustained its efforts to create a real estate regulatory environment that would stand up to scrutiny, which is when it topped the Middle East standings.
Last year, it upgraded the status of the property rental dispute redress regime under the Dubai Land Department. According to market observers, more than anything else it has created a more even playing field for investors and tenants alike.
But, according to JLL, Qatar’s regulatory regime too has seen a marked openness – ironic given the ongoing global whiplash over how the Gulf state may have won the rights for the 2022 World Cup. “In the region, promising signs of reform leading up to the global financial crisis have not been maintained at the same pace, with the notable exception of Qatar,” said Craig Plumb, head of research for the Mena region at JLL. “The glare of the international spotlight has shone brightly on Qatar’s successful bid for the FIFA World Cup in recent months, contributing to the move towards greater transparency and openness.
“Qatar has been the biggest improver over the past two years with the launch of an ‘open data’ policy under which the Government has provided increased public access to non-personal’ data.”
As for Dubai, further improvements are in the offing on the regulatory side – “Dubai is likely to further consolidate its regional leadership over the next two years,” said Plumb.
If that progress comes through, it would be the catalyst for specialist real estate investment vehicles such as international eit to emerge on the local scene. (There is a Reit already active in the marketplace, but Emirates Reit is of local origin.)
Investors are also looking beyond the residential and office spaces – “We believe the areas of social infrastructure – for example schools and healthcare facilities – as well as logistics and community retail are particularly attractive because these sectors benefit from strong fundamentals, provide stable and attractive income, and hold potential for growth in capital value,” said Talal Al Zain, CEO of PineBridge Investments, which recently raised $100 million plus for a specialist property fund.
