GCC Real Estate Sale Transactions Reaches $143.1 Bn

The Gulf real estate sector witnessed a growth in the value of deals until October of this year, equivalent to the total sales in 2021 (SPA)
The Gulf real estate sector witnessed a growth in the value of deals until October of this year, equivalent to the total sales in 2021 (SPA)
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GCC Real Estate Sale Transactions Reaches $143.1 Bn

The Gulf real estate sector witnessed a growth in the value of deals until October of this year, equivalent to the total sales in 2021 (SPA)
The Gulf real estate sector witnessed a growth in the value of deals until October of this year, equivalent to the total sales in 2021 (SPA)

Real estate sale transactions in the GCC over Jan-Oct 2022 reached $143.1 billion, eclipsing the full-year figure of 2021, which was $136.9 billion.

According to Kuwait-based KAMCO Investment Company, the total value of the region was nearly 21 percent higher year-on-year compared to the corresponding period from January to October 2021.

The higher transaction activity was driven by value transacted in Dubai that increased almost 81 percent year-on-year over the period, supported by solid demand and price gains witnessed by luxury residential properties and healthy revenues in the affordable segment.

The report, of which Asharq Al-Awsat obtained a copy, stated that the number of transactions in the GCC declined by six percent over Jan-Oct 2022 to 511,239 deals despite a jump of over 61 percent witnessed in Dubai, as other markets such as Saudi Arabia, Qatar, and Kuwait saw the lower activity as compared to the same period in 2021.

The average value per transaction achieved for markets such as Saudi Arabia (+35.5 percent) and Dubai (+12.2 percent) was significantly higher, pointing toward end-user solid demand and investment appetite.

"We reiterate that 2022 will be the new base year for the office real estate demand for both new and existing stock of office spaces. Separately, temperature-controlled spaces, chilled centers, and bonded warehouses continue to command premiums of at least 25 percent -30 percent at the top end of the industrial warehouse market," KAMCO says.

All real estate sub-segments in the GCC have performed better in 2022 than in 2021, with residential and quality industrial warehouses witnessing reasonable price and rental increases.

Office supply tailored towards newer sources of demand such as robotics, IT, and healthcare will continue to see faster take-up of such spaces.

The strong NOI (net operating income) performance across sub-segments combined with the twin risks of further interest rate hikes and a prolonged period of high rates could have pushed real estate assets in specific geographies into a late-stage expansion phase, says the report.

"Nevertheless, developers remain cautious of these trends and are expected to announce project launches likely to cater to a more normalized demand environment going forward."

Investor sentiment gained momentum in 2022 and resulted in opportunistic buying in select GCC markets and residential product types, similar to trends in 2021. As a result, prices rose across markets such as Dubai (+9 percent) and Jeddah (+20 percent) at the end of Q3-2022, as per JLL.

Developers continue to provide more flexible payment plans with lower down payments and post-completion plans to attract off-plan and first-time buyers, while catalysts and product demand differ across various GCC markets.

According to the report, Saudi residential sector demand would continue to be driven by Vision 2030's target of increasing home ownership to 70 percent by the end of the decade, and as of mid-2022, the Saudi Real Estate Refinance Company estimates home ownership to have reached above 60 percent.

However, rising interest rates resulted in lower offtake of mortgages, as the number of mortgages over Jan-Oct 2022 declined almost 17 percent.



Saudi's flynas Strikes Deal for Additional Airbus A320neos, 15 A330s

Saudi's flynas strikes deal for additional Airbus A320neos, 15 A330s (flynas)
Saudi's flynas strikes deal for additional Airbus A320neos, 15 A330s (flynas)
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Saudi's flynas Strikes Deal for Additional Airbus A320neos, 15 A330s

Saudi's flynas strikes deal for additional Airbus A320neos, 15 A330s (flynas)
Saudi's flynas strikes deal for additional Airbus A320neos, 15 A330s (flynas)

flynas, Saudi Arabia’s leading low-cost carrier, has signed a Memorandum of Understanding (MoU) with Airbus for 75 A320neo family aircraft and 15 A330-900. This strategic agreement will expand the airline's capacity, range and enhance its overall fleet capabilities.
Signed during Farnborough International Airshow in the presence of President of the General Authority of Civil Aviation (GACA) of Saudi Arabia, Abdulaziz bin Abdullah Al-Duailej, Chairman of the Board of NAS Holding Ayed Al Jeaid, flynas Chief Executive Officer & Managing Director Bandar Almohanna, and Airbus Chief Executive Officer, Commercial Aircraft, Christian Scherer, Airbus said on its website.
The new aircraft will join the carrier’s all Airbus fleet serving international, domestic and regional routes. The new A330-900 aircraft will boast a two-class configuration, accommodating up to 400 passengers.
"We are excited to further strengthen our long-standing partnership with Airbus," said Bander Almohanna, CEO and Managing Director of flynas. "The A320neo Family provides exceptional operational performance and environmental benefits, allowing us to offer unique, low-cost travel experiences. Additionally, the A330neowill enhance our long-haul capabilities with its advanced technology and efficiency while supporting our growth plans and Saudi Arabia’s pilgrim program."
Airbus Chief Executive Officer, Commercial Aircraft, Christian Scherer said, "We are delighted to expand our partnership with flynas through this significant milestone for both A320neo and A330-900 aircraft. The A330neo will allow flynas to further grow into widebody markets by building on the A320, benefiting from Airbus’ unique commonality. Both aircraft types offer flynas the perfect versatility and economics to expand into new markets while offering their passengers the latest cabin experience and comfort. We look forward to continuing our successful collaboration with flynas as they embark on this exciting new chapter."
The addition of the A330-900 aircraft will support flynas' ambitious growth plans. The airline anticipates significant operational efficiency gains by combining the new widebody aircraft with its existing A320neo fleet. The A330-900 offers increased capacity and range at unrivaled seat costs, ensuring flynas can compete effectively in the growing regional market, a key focus area for the airline.
The A330neo delivers unbeatable operating economics, powered by the latest-generation Rolls-Royce Trent 7000 engines, featuring new wings and a range of aerodynamic innovations resulting in a 25 percent reduction in fuel consumption and CO₂ emissions compared to previous generation competitor aircraft. The A330neo is capable of flying 8,150 nm / 15,094 km non-stop, providing ultimate comfort with more passenger space, a new lighting system, latest in-flight entertainment systems and full connectivity throughout the cabin.
As with all Airbus aircraft, the A330 family is already able to operate with up to 50% Sustainable Aviation Fuel (SAF). The manufacturer is targeting to have its aircraft up to 100% SAF capable by 2030.