Mashreq Property Wealth Gauge

Volume 20 | April 2015

Economic Overview

UAE’s economy has registered a positive growth in 2014. In spite of the dip in Global Oil prices the GDP forecast for 2015 looks positive and is expected to grow at 3.5%. With a stable political background, a word-class infrastructure and with a strong economic outlook UAE’s economy still offers abundant investment opportunities. With hosting the Expo 2020 the economic benefits would trickle down and will be spread over the long run.

The Overall Consumer Price Index (CPI) for the month of Feb’15 has reached 123.60 (as against an index of 100 set for 2007). The overall CPI has increased by 0.09% as compared to previous month. The average increases in prices recorded were at 3.61% as compared to same time last year i.e. Feb’14. (Source: National Bureau of Statistics)

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Mashreq

Property

Wealth Gauge.

Real Estate Sector Highlights

• Real estate sector continues to witness new project launches. The Affordable development is also catching investor attention. Nakheel has announced a planned expansion of 6.5 Million sq ft of residential, retail and hotel expansion for Dragon mart. A twin - tower residential project is also planned within the complex with 1,120 one & two bedroom apartments along with a hotel with 250 rooms. The will witness an expansion of 4.7 Million sq ft, which will include a new mall, cinema complex, and a 4 - star hotel with 370 rooms. Nakheel has also announced to build Mall, Towers and Boulevard, a 16 – tower community with 2,400 apartments and town houses spread over four clusters. The island will also consists of an extensive parkland with a 4.9 million sq. ft. of mall space.

• Emaar has announced a new residential tower development in Downtown. The tower will have a direct access to . The tower “Downtown Views” will be a 55 storey tower built atop of a podium. The tower will comprise of 418 one, two & three bed room apartments. The apartments will have panoramic views of & . The tower will be well connected via the Dubai Mall metro station

• Al Barari has announced a new residential development “The Nest”, a Villa community comprising of 99 four-bedroom villas. The project offers a new size within Al Barari with units starting from AED 7.7 Million. The Villas once ready will offer luxury finishes with private pools located near the spacious landscapes.

• Nshama has unveiled new residential apartments in the affordable category. Zahra Apartments would be the first residential project in Town Square nicely priced at AED 350K. Investors will have an option to choose from different layouts, some offering generous outdoor terraces & some with direct access to the podium.

• Dubai Government’s new initiative on proposed implementation of the International Property Measurement Standard (IPMS) is a step in the right direction. Currently the measurement of assets varies dramatically from country to country. For example it is an established practice to include common spaces for lift shafts, communal hallways, etc in floor area mesurements. With so many different methods of measurement it becomes very difficult for property users, investors, occupiers and developers to accuratley compare space globally. The International Property Measurement Standards Coalition (IPMSC) which is a non-for-profit organisations’ of international professionals, are actively working very closely to develop and embed a single property measurement. Once developed this will ensure that property assets are measured in a consistent way creating transparency, strong investor confidence and increase is stability in the Real Estate market.

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Mashreq Property Wealth Gauge.

Mashreq Property Pricing Index

At Mashreq we have been tracking the property prices by indexing them community wise on a scale of 100. Basis the Mashreq Property Price Indexing, the percentage change over a period of time has been indicated both for Villas & Apartments for major communities.

Change in Last Change in Change in Last 12 Mashreq Property Price Index Month Last 3 Months Months % change Per 14- 14- 14- 14- 14- 14- 14- 14- 14- 15- 15- 15- % % from Mar- Sq. Ft Location Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Change change Change change Change 14 (Aed)    1,265 85.1 84.8 84.2 82.7 82.1 81.5 81.2 81 80.7 80.4 79.4 77.9 -1.9% -3.5% -8.8%    3,616 Burj Khalifa Tower 53.4 53.3 53.3 53.1 52.8 52.6 52.6 52.4 51.7 51.7 51.7 50.9 -1.4% -1.4% -3.6%    2,828 Burj Dubai Downtown 104.4 104.6 105.2 105.2 105.2 104.7 104.6 104.4 104.4 104.4 104.4 103.8 -0.6% -0.6% -0.5%    1,319 74.3 74.9 74.5 74.7 75.1 74.3 74 72.4 72.2 72 71.8 71.3 -0.7% -1.2% -3.2%    1,775 DIFC 55.2 55.2 55.8 55.8 55.8 55.7 55.7 55.6 55.2 54.5 53.7 53.0 -1.4% -4.1% -3.6%    937 Dubai Land 76.6 77.4 77.5 76.4 76.7 76 75.9 76.4 75.1 74.1 74.2 73.3 -1.2% -2.4% -4.5%    1,759 83.4 83.4 82.9 82.9 83.2 83 84.8 84.8 83.9 83.9 84 83.8 -0.3% -0.1% 0.3%    1,298 Greens 73.4 74 74.2 72.4 71.7 70.7 70.1 71.2 70.2 70.2 69 68.3 -1.0% -2.7% -6.9%    659 International City 75.7 75.7 76.4 75.7 76 74.7 74.3 75 74 74.2 73.9 73.2 -0.9% -1.0% -2.4% Jumeirah Beach 79.4 79.1 82 82 81.6 81.3 81.3 82.6 81 80.1 78.2 78.0  -0.2%  -3.7%  -1.4% 1,541 Residences    1,021 61.9 61.9 62.3 62.1 61.4 62.1 61.4 62.1 61.5 61.3 61.3 60.9 -0.5% -0.9% -0.4%    1,763 98.5 98.6 98.6 98.1 98.1 97.9 97.9 98.1 98 97.8 96.1 95.3 -0.9% -2.7% -3.2%    1,131 Jumeirah Park 81.2 80.7 79.4 78.9 77.9 76.4 76.4 77.2 75.2 74.1 74.1 71.2 -3.9% -5.3% -13.2%    913 Jumeirah Village 113.8 114.1 114 113 111.2 110.1 106 105.3 102.8 100.6 101.2 101.5 0.3% -1.3% -11.1%    2,047 Old Town Burj Dubai 76.8 76.8 76.8 76.8 76.8 76.6 76.6 77 75.9 72.8 72.8 71.8 -1.4% -5.3% -6.4%    2,800 126.3 126.3 127.4 125.6 126.3 126.4 126.4 126.8 131.6 130.4 130.4 125.8 -3.5% -4.3% 0.1%    1,299 Springs/ Meadows 84.5 84 83.5 81.8 81.1 79.2 78.9 79.1 77.1 76.4 74.8 74.3 -0.7% -3.7% -12.5%

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Mashreq Property Wealth Gauge. Villa and Apartments: The property prices for the month of March’15 have corrected by 0.1% on an average, across all major locations as compared to the previous months. A similar trend has been observed over the last six months. The cumulative percentage change since March 2013 is at 23.2%. The numbers indicate a stabilizing trend in property prices across all major locations.

Over a period of last 12 months (i.e. since April’ 14) Prominent Villa Community such as Jumeirah Park have witnessed a decrease in property prices by 13.2%, followed by Springs & Meadows which has witnessed a decrease by 12.5%.

Over a period of last 12 months (i.e., since April’ 14) Apartments in Burj Khalifa have witnessed a decrease in property prices by 3.6%, followed by Jumeirah Beach Residences which has witnessed a decrease of 1.4%

Property Price Watch Villa Price Trend

Change in Change in Last Last 3 Change in Last 12 Mashreq Property Price Index Month Months Months

% % change Per Sq. Location 14-Apr 14-May 14-Jun 14-Jul 14-Aug 14-Sep 14-Oct 14-Nov 14-Dec 15-Jan 15-Feb 15-Mar Change % change Change change Change from Mar-14 Ft (Aed)

Arabian Ranches 85.1 84.8 84.2 82.7 82.1 81.5 81.2 81 80.7 80.4 79.4 77.9  -1.9%  -3.5%  -8.8% 1,265

Jumeirah Islands 98.5 98.6 98.6 98.1 98.1 97.9 97.9 98.1 98 97.8 96.1 95.3  -0.9%  -2.7%  -3.2% 1,763

Jumeirah Park 81.2 80.7 79.4 78.9 77.9 76.4 76.4 77.2 75.2 74.1 74.1 71.2  -3.9%  -5.3%  -13.2% 1,131

Jumeirah Village 113.8 114.1 114 113 111.2 110.1 106 105.3 102.8 100.6 101.2 101.5  0.3%  -1.3%  -11.1% 913

Springs/ Meadows 84.5 84 83.5 81.8 81.1 79.2 78.9 79.1 77.1 76.4 74.8 74.3  -0.7%  -3.7%  -12.5% 1,299 4

Mashreq Property Wealth Gauge.

Apartment Price Trend

Change in Change in Last Last 3 Change in Last 12 Mashreq Property Price Index Month Months Months

14- % % change from Per Sq. Location 14-Apr 14-May 14-Jun 14-Jul 14-Aug 14-Sep 14-Oct Nov 14-Dec 15-Jan 15-Feb Mar-15 Change % change Change change Change Mar-14 Ft (Aed)

Burj Khalifa Tower 53.4 53.3 53.3 53.1 52.8 52.6 52.6 52.4 51.7 51.7 51.7 77.9  -1.9%  -3.5%  -8.8% 1,265

Burj Dubai Downtown 104.4 104.6 105.2 105.2 105.2 104.7 104.6 104.4 104.4 104.4 104.4 95.3  -0.9%  -2.7%  -3.2% 1,763

Dubai Marina 83.4 83.4 82.9 82.9 83.2 83 84.8 84.8 83.9 83.9 84 71.2  -3.9%  -5.3%  -13.2% 1,131 Jumeirah Beach Residences 79.4 79.1 82 82 81.6 81.3 81.3 82.6 81 80.1 78.2 101.5  0.3%  -1.3%  -11.1% 913

Jumeirah Lake Towers 61.9 61.9 62.3 62.1 61.4 62.1 61.4 62.1 61.5 61.3 61.3 74.3  -0.7%  -3.7%  -12.5% 1,299

Outlook

• We expect developers to continue launching new project in the affordable category with attractive backloaded payment plans. • The transaction activity is expected to remain subdued on account of cautious approach from purchasers and sellers alike. • The Property Prices for Completed Villa & Apartment projects is expected to remain stable, the prices on the off – plan projects is expected to remain competitive.

• The Property Market is expected to remain stable for Q2.

Disclaimer: Please note that this communication constitutes information of general market information and based on studies and research, it should not be solely relied on without an opinion from you investment advisor. Mashreqbank psc shall not be liable for a liability arising out of any financial advice provided in connection with this communication.

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