Property Review Real Estate Report Q3 2019 BUILDING The building consultancy team at Asteco have a wealth of experience and an in-depth knowledge CONSULTANCY of construction technology, building pathology and effective project management methods With you throughout all stages of your which enable us to provide our Clients with a comprehensive building consultancy service. built asset lifecycle

Technical Due Snagging Area Diligence Inspections Verification

Life Cycle Schedules of Schedules of Costing Dilapidations Condition

Project RERA Technical Building Monitoring and Reports Condition Audits Surveys

Defect Project Insurance Analysis Management Reinstatement For more details, please contact Valuation Nick Constantine, BSc (Hons) MRICS, Head of Building Consultancy [email protected] ABU DHABI MARKET OVERVIEW

SUPPLY RENTAL RATES SALES PRICES Approximately 1,000 residential units were delivered in Q3 2019 Whilst average residential rental rate declines were marginal over Whilst apartment sales prices declined by 2% since Q2 2019, across various areas including, but not limited to, Beach, the last three months, a number of projects/areas that Asteco recorded annual drops of 9% on average with some , and Abu Dhabi City. experienced significant reductions in 2018 recorded no change in projects located on Al Raha Beach and Al Reem Island registering Q3 2019. decreases between 10% and 20%. Following the success of a number of projects on a plot-sale-basis, Aldar launched Saadiyat Reserve, a 422,370 sq.m. residential Annual declines were more pronounced with 7% for apartments The reduction in villa sales prices was modest, with quarterly and community featuring 306 serviced villa plots. The plots range from and 2% villas, particularly within the low and mid quality bracket. annual declines of 2% and 4%, respectively. 600 sq.m. to 1,400 sq.m., with planning approval for 4 to 6 In fact, some projects recorded declines of more than 15%. bedroom villas and are available between AED 1.8 million and AED A limited offer by including discounts, fee waivers 2.5 million. Similarly, average office rental rates only softened marginally since and extended payment plans on 10 of their residential Q2 2019. However, it should be noted that several office buildings developments generated good levels of demand. Another launch included Wahat Yas by Wahat Al Zaweya Real offered discounts of more than 5% in addition to incentives such Estate Development, a mixed-use development spread over 1.85 as rent-free fit-out periods and service charge exemptions. Transaction volumes for completed properties remained limited million sq.m., and located between the Al Bahia area and Al Raha despite recent regulatory changes concerning title deeds (allowing Beach, next to Yas Island water canal. It comprises villa and Annual drops varied significantly and ranged from 0% to -14%. expatriates to own properties on freehold basis in designated building land plots (available for sale to UAE nationals only), with Generally, Landlords accepted lower rents in order to maintain Investment Zones - freehold ownership was previously limited to the former measuring from 400 sq.m. to 600 sq.m. and starting high occupancy levels. UAE and GCC nationals, whilst expatriates were restricted to from around AED 1.1 million. 99-year leasehold rights). Interest in serviced offices, which is increasingly curtailing demand In addition to the above, Asteco noted: for traditional office space, was driven by a combination of factors including flexibility, as well as a global shift in corporate culture • The opening of the Galleria expansion, adding and use of space. 270 shops and 70 restaurants with entertainment areas; and Overall, the continuous stream of new supply resulted in a rise in • The launch of Al Maryah Vista (by Webridge Properties in vacancy rates across all asset classes, but particularly within older partnership with Mubadala Investment Company), located on Al properties. Maryah Island and featuring 772 high-end apartments.

3 Abu Dhabi Real Estate Report - Q3 2019 ABU DHABI SUPPLY

COMPLETED IN COMPLETED IN EXPECTED IN H1 2019 Q3 2019 Q4 2019

3,200 900 3,800 APARTMENTS NO. OF UNITS

950 100 300 VILLAS NO. OF UNITS

45 - 40 OFFICES THOUSAND SQ.M.

4 Abu Dhabi Real Estate Report - Q3 2019 ABU DHABI APARTMENT RENTAL RATES

(All figures in AED 000’s p.a.)

STUDIO 1 BEDROOM 2 BEDROOMS 3 BEDROOMS % CHANGE Q2 2019 - Q3 2018 - FROM TO FROM TO FROM TO FROM TO Q3 2019 Q3 2019 PRIME PROPERTIES ABU DHABI ISLAND - - 75 130 110 165 160 245 0% -2% INVESTMENT AREA 65 105 95 155 130 210 180 290 0% -3% HIGH END PROPERTIES Central Abu Dhabi - 80 132 ABU DHABI ISLAND Corniche 90 120 125 160 -5% Khalidya / Bateen 65 75 85 135 170 -1% -7% Al Raha Beach 60 70 95 105 140 195 Marina Square 47 55 60 80 75 130 120 150 -4% INVESTMENT AREA 52 60 62 80 90 120 125 155 -1% Saadiyat Beach - 75 105 130 145 155 170 -3% -10% MID END PROPERTIES ABU DHABI ISLAND 42 50 83 70 125 100 155 -2% Shams Abu Dhabi - 65 70 100 110 135 -6% INVESTMENT AREA Najmat & Tamouh 42 50 55 63 70 100 98 140 OFF ISLAND Khalifa & MBZ City 35 45 50 65 120 135 -3% LOW END PROPERTIES Central Abu Dhabi 35 40 45 50 50 100 ABU DHABI ISLAND Corniche 40 45 55 60 65 75 90 -1% -9% Khalidiya / Bateen 38 40 45 55 70 95 -7% INVESTMENT AREA Al Reef 40 45 50 60 65 75 -10% OFF ISLAND Khalifa & MBZ City 30 35 60 85

Q-o-Q Y-o-Y Since peak Since market low % Change Since Q2 2019 Since Q3 2018 Q4 2015 Q2 2012 -1% -7% -25% -5%

5 Abu Dhabi Real Estate Report - Q3 2019 ABU DHABI APARTMENT SALES PRICES

Q-o-Q % Change Y-o-Y % Change AED per sq.ft. 0 500 1,000 1,500 2,000 (Q2 2019 - Q3 2019) (Q3 2018 - Q3 2019)

AL BANDAR 1,150 1,500 0% -15%

AL MUNEERA 1,000 1,250 -6% -10%

AL ZEINA 800 1,100 -7% -21%

CITY OF LIGHTS - HYDRA 750 850 0%

MARINA SQUARE 850 1,050 -5%

REEF DOWNTOWN 650 850 -6% -6%

SAADIYAT BEACH RESIDENCES 1,250 1,400 -7%

SUN & SKY TOWERS 950 1,050 -15%

THE GATE 950 1,050 -2%

YAS ISLAND 1,100 1,300 0% -14%

13%

Q-o-Q Y-o-Y Since peak Since market low % Change Since Q2 2019 Since Q3 2018 Q4 2015 Q3 2012 -2% -9% -28%

6 Abu Dhabi Real Estate Report - Q3 2019 ABU DHABI VILLA RENTAL RATES

(All figures in AED 000’s p.a.)

2 BEDROOMS 3 BEDROOMS 4 BEDROOMS 5 BEDROOMS % CHANGE

FROM Q2 2019 - Q3 2018 - TO FROM TO FROM TO FROM TO Q3 2019 Q3 2019

Khalidiya / Bateen - - 160 165 178 170 220 -1% 0% ABU DHABI ISLAND Mushrif / Karama / Manaseer - 150 165 180 160 210 0% -2% Nahyan Camp / Muroor - 125 145 170 190 -3% Al Raha Beach 185 190 260 250 265 -2% Al Reef 78 87 98 110 140 135 155 0% -8% INVESTMENT AREA Hydra Village 60 70 72 82 - -4% -11% Saadiyat Beach Villas 280 310 350 365 690 Hidd Al Saadiyat 290 330 750 -1% -5% Al Raha Gardens 155 215 -9% Golf Gardens - 200 220 270 -3% OFF ISLAND 115 130 Mohamed Bin Zayed 100 105 110 145 -4%

7%

Q-o-Q Y-o-Y Since peak Since market low % Change Since Q2 2019 Since Q3 2018 Q4 2015 Q4 2012 0% -2% -15%

7 Abu Dhabi Real Estate Report - Q3 2019 ABU DHABI VILLA SALES PRICES

Q-o-Q % Change Y-o-Y % Change AED Million 0 2 4 6 8 10 12 (Q2 2019 - Q3 2019) (Q3 2018 - Q3 2019)

2 BR 1.25 3 BR 1.50 AL REEF VILLAS -6% -12% 4 BR 1.90 5 BR 2.20

3 BR 3.10 GOLF GARDENS 0% 0% 4 BR 3.90 5 BR 4.88

HIDD AL SAADIYAT 0% 4 BR 6.35 5 BR 8.00

2 BR 0.92 3 BR 1.20 HYDRA VILLAGE

3 BR 2.33 RAHA GARDENS -1% -3% 4 BR 2.60 5 BR 3.80

3 BR 5.50 -6% SAADIYAT BEACH VILLAS 4 BR 6.55 5 BR 9.25

22%*

Q-o-Q Y-o-Y Since peak Since market low % Change Since Q2 2019 Since Q3 2018 Q4 2015 Q4 2012 -1% -4% -9%

* Includes Raha Gardens, Golf Gardens & Al Reef Villas only. Later averages are reflective of an increase in new developments of higher quality. 8 Abu Dhabi Real Estate Report - Q3 2019 ABU DHABI OFFICE RENTAL RATES

(All figures in AED per sq.m. p.a.)

AVERAGE RENTAL RATES % CHANGE

FROM TO Q2 2019 - Q3 2019 Q3 2018 - Q3 2019

PRIME STOCK FITTED* 1,500 2,500 0% QUALITY STOCK FITTED 770 1,200 -1% -4% SHELL AND CORE 650 950 -2% -8% OLDER STOCK GOOD 600 800 -4% TYPICAL BUILDING 500 700 -7% LOW QUALITY BUILDING 470 580 -3% -5%

* Includes developments such as Al Maryah Island, Aldar HQ, International Tower, Nation Towers, Ittihad Towers, etc. Q-o-Q Y-o-Y Since peak Since market low ** The average percentage change calculation excludes Prime Stock % Change** Since Q2 2019 Since Q3 2018 Q4 2015 Q4 2012 -1% -6% -20% -17%

9 Abu Dhabi Real Estate Report - Q3 2019 ABU DHABI PROPERTY MAP

1 – Raha Beach 2 Al Bateen Wharf 11 3 Al Gurm 4 Al Maqtaa 5 Al Muneera – Al Raha Beach 37 6 Al Nahyan Camp 21 7 Al Raha Gardens 8 Al Rayanna 9 Al Reef 10 Al Zeina – Al Raha Beach 27 33 YAS 11 Baniyas 25 34 35 ISLAND 12 Bateen Airport Area 16 31

13 Bateen Area 32 17 14 Bawabat Al Sharq 22 6 15 Capital District (ADNEC) 10 1 16 CBD / Tourist Club Area 2 9 13 17 Corniche 19 5 28 18 Danet Abu Dhabi 18 7 19 Eastern Mangroves 12 15 3 20 20 Golf Gardens 30 23 33 21 Hydra Village 36 8 4 22 Khalidia / Al Hosn / Al Manhal 38 23 Khalifa City A 29 24 Khalifa City B 25 Maryah Island 26 MBZ City 24 11 27 Mina 26 22 28 Mushrif / Karama / Manaseer / Muroor 29 Officer’s City 30 Rawdhat Abu Dhabi 31 Reem Island - Marina Square 32 Reem Island – Najmat Abu Dhabi 14 33 Reem Island – rest of Shams Abu Dhabi 11 34 Reem Island – City of Lights 35 Reem Island – The Gate District 36 Rihan Heights 37 Saadiyat Beach District 38 The Hills

10 Abu Dhabi Real Estate Report - Q3 2019 About Asteco

The Middle East’s largest full service Real VALUATION & ADVISORY SALES BUILDING CONSULTANCY Estate Services Company, Asteco was formed Our professional advisory services are Asteco has established a large regional The Building Consultancy Team at Asteco have in Dubai in 1985. Over the years, Asteco has conducted by suitably qualified personnel property Sales division with representatives a wealth of experience supporting their Clients gained enormous respect for consistently all of whom have had extensive Real Estate based in the UAE, Qatar and Jordan. Our throughout all stages of the built asset lifecycle. delivering high quality, professional, value- experience within the Middle East and Sales teams have extensive experience in the Each of the team’s highly trained surveyors added services in a transparent manner. It is internationally. negotiation and sale of a variety of assets. have an in-depth knowledge of construction also widely recognised for its involvement with technology, building pathology and effective Our valuations are carried out in accordance many of the projects that have defined the LEASING project management methods which enable landscape and physical infrastructure of the with the Royal Institution of Chartered Asteco has been instrumental in the Leasing us to provide our clients with a comprehensive Emirates. Surveyors (RICS) and International Valuation of many high-profile developments across the building consultancy service. Standards (IVS) and are undertaken by GCC. Asteco has an essential combination of local appropriately qualified valuers with extensive FRANCHISE knowledge and international expertise. local experience. ASSET MANAGEMENT Our brand, network, system and procedures A deeply established brand, renowned for Asteco provides comprehensive Asset are now available in territories across the its application of the latest technological The Professional Services Asteco conducts Management services to all property Owners, MENA region. Our Licensing services currently advances, its commitment to transparency, throughout the region include: whether a single unit (IPM) or a regional include Real Estate Brokerage Franchising and winning strategies and human expertise. mixed-use portfolio. Our focus is on maximising associated support services with many of the • Consultancy & Advisory services Undisputed Real Estate experts, Asteco value for our Clients. key elements designed specifically around represents a significant number of the • Market research the Franchisee, making it a truly unique and region’s top property Owners, Developers and • Valuation services OWNERS ASSOCIATION bespoke franchise opportunity. Investors. Asteco has the experience, systems, procedures and manuals in place to provide streamlined comprehensive Association Management and Consultancy services to residential, commercial and mixed-use communities throughout the GCC Region.

Elaine Jones John Stevens John Allen James Joughin Jenny Weidling Ghada Amhaz Tamer Ibrahim Chaaban FRICS MSc, BSc (Hons), MRICS BSc, MRICS BSc (Hons), MRICS BA (Hons) MSc BE Executive Chairman and Managing Director/ Executive Director - Senior Associate Manager - Research and Manager - Research and Associate Director / Founder / Director - Director - Asset Management Valuation & Advisory Director - Head of Valuations Advisory, Dubai Advisory, Abu Dhabi General Manager - Transactional Services +971 4 403 7777 +971 4 403 7777 +971 4 403 7777 +971 4 403 7777 +971 2 626 2660 +971 3 766 6097 +971 4 403 7777 [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected]

DISCLAIMER: The information contained in this report has been obtained from and is based upon sources that Asteco Property Management believes to be reliable; however, no warranty or representation, expressed or implied, is made to the accuracy or completeness of the information contained herein, and same is submitted subject to errors, omissions, change of price, rental or other conditions, withdrawal without notice, and to any special listing conditions imposed by our principals. Asteco Property Management will not be held responsible for any third-party contributions. All opinions and estimates included in this report constitute Asteco Property Management’s judgment, as of the date of this report and are subject to change without notice. Figures contained in this report are derived from a basket of locations highlighted in this report and therefore represent a snapshot of the UAE market. Averages, however, represent a wider range of areas. Particularly exclusive or unique projects have been excluded from the data to avoid distorting averages. Due care and attention has been used in the preparation of forecast information. However, actual results may vary from forecasts and any variation may be materially positive or negative. Forecasts, by their very nature, involve risk and uncertainty because they relate to future events and circumstances which are beyond Asteco Property Management’s control. For a full in-depth study of the market, please contact Asteco Property Management’s Research team. Asteco Property Management LLC. Commercial License No. 218551. Paid-up Capital AED 4,000,000. | ORN 180

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