Abu Dhabi Report H2 2012

“2012 was a pivotal year for the Abu Dhabi real estate market with the delivery of significant new developments which have raised the quality of living and working standards in the capital. The residential sub-sectors are now becoming more clearly defined by qualitative factors with tenants seeking value for money. In 2013 we expect to see a widening segregation in rental rates between the popular new developments, which, with occupancy levels rising, will be able to sustain rental levels and in some cases achieve growth, and the less popular older stock, that will continue to see rents come under downward pressure as landlords compete to maintain occupancy.“ Paul Maisfield, Associate Director & General Manager Abu Dhabi, Asteco Property Management Abu Dhabi Supply Estimates

2012 New Supply 2013 Scheduled New Supply Average Apartment Rental Rates (AED’000/pa) Apartments (in units) 9,000 12,000 Studio 1 BR 2 BR 3 BR Villas (in units) 6,000 5,000 From To From To From To From To Offices (in m2) 312,000 290,000 Marasy -- 87 110 135 170 185 237 Marina Square 55 65 75 85 110 130 140 180 Nation Towers - - 95 100 145 170 165 300 Reef Downtown - - 55 65 70 75 85 95 Residential Market Overview Rihan Heights -- 95 122 130 150 155 190 ƒƒ We estimate that approximately 15,000 new homes have been delivered to the Abu Dhabi market Saadiyat Beach Apartments -- 81 128 130 163 165 206 over the course of 2012, with a further 17,000 scheduled for completion in 2013. Shining Towers - - - - 120 140 175 230 ƒƒThe distribution of the new supply is presented in the table below. St. Regis Residences 75 90 110 145 180 190 240 260

Investment Areas Non Investment Areas Sun & Sky Towers -- 90 100 120 140 155 180 Total Mainland Reem Saadiyat Abu Dhabi Island Mainland ƒƒ In 2013 we expect to see a widening segregation in rental rates between the popular new 2012 3,500 3,300 400 2,300 5,500 15,000 developments, which, with occupancy levels rising, will be able to sustain rental levels and in some cases achieve growth over the next 12 months, and the older less popular stock, that will continue 2013 3,000 5,900 500 3,000 4,600 17,000 to see rents come under downward pressure as landlords compete to maintain occupancy. Total 6,500 9,200 900 5,300 10,100 32,000 ƒƒThe performance of the Abu Dhabi residential leasing market in 2013 will be strongly influenced by ƒƒThe introduction of this new supply has resulted in average rental levels declining across the market the impact the two recent Government announcements will have on demand: on average by 12% over the last 12 months. 1. Government employees required to reside in Abu Dhabi to qualify for housing allowances; ƒ ƒAs expected, when the new Investment Area developments initially entered the market during 2. All leases to be registered in the Tawtheeq system thus precluding the sharing of accommodation. the first half of the year, rental rates declined given the volume of availability. However, these developments have generated good levels of demand, driven by residents upgrading to better quality accommodation, which consequently resulted in more stable rents, particularly over the last Office Market Overview three months. In some cases, the rental declines seen in the first half of the year have been reversed as take up levels increased. ƒƒWe estimate that approximately 312,000 m2 (NLA) of office space has entered the market in 2012, 2 ƒƒCurrent asking rents for selected new developments in the city are presented in the following table. with a further 290,000 m (NLA) scheduled for completion in 2013. ƒƒThe major new additions in 2012 included IPIC Headquarters, Nation Towers, Liwa Tower and Average Apartment Rental Rates (AED’000/pa) Shining Towers. Upcoming projects for 2013 include Al Bustan Complex, the ADIC Headquarters, Studio 1 BR 2 BR 3 BR World Trade Centre and Landmark Tower. From To From To From To From To ƒƒThe delivery of superior quality offices combined with attractive lease terms has resulted in growth Al Bandar 75 80 110 115 130 150 200 230 in transaction activity throughout 2012. Take-up has been dominated by the government sector Al Muneera - - 80 90 110 130 150 190 with entities including Abu Dhabi Tourism Authority, Ministry of Economy, Ministry of Labour, Department of Transport and Etihad Rail taking a substantial amount of office space. Private sector Al Zeina - - 80 90 115 130 140 165 demand has also increased, although requirements are relatively small (less than 500 m2). Capital Plaza - - 100 120 125 155 175 250 ƒƒAverage Grade A office rents are now AED 1,600 per m2 (net effective), representing a decline of Etihad Towers - - 100 149 139 177 195 324 close to 16% over the last 12 months.

02 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com Summary H2 2012 and Outlook H1 2013 Residential Leasing – Apartments and Villas

H2 2012 H1 2013

Transaction Activity ƒƒ Transaction activity has been strong as a result of new quality supply being delivered to the market combined ƒƒ We anticipate that transaction activity will remain strong in 2013, as more supply enters the market. with more attractive rental rates, driving internal movement. ƒƒ In addition, the recent announcement requiring Government employees to live in Abu Dhabi to qualify for a ƒƒ In addition, the new Tawtheeq lease registration requirements and the government’s efforts to stamp out illegal housing allowance is likely to lead to increased demand at the high end of the market given the value of housing sub-division of villas has led to an increase in demand at the lower affordable end of the market. allowances offered.

Popular ƒƒ Prime developments offering a high-end lifestyle as part of a mixed use community (i.e. high quality, good ƒƒ The prime “life-style” developments will continue to prove popular and rising occupancy levels are likely to Developments and finishes/specifications and access to an array of high quality facilities/amenities) satisfied pent up demand at facilitate some rental growth in 2013 as there are currently few competing developments within this high-end Unit Types the top end of the market (i.e. St Regis, Etihad Towers and Eastern Mangroves). segment. There is a waiting list for apartments at the popular St Regis Residences on Saadiyat Island. ƒƒ The major Investment Area developments on Reem Island and Raha Beach have also proven popular with ƒƒ Saadiyat Island is anticipated to become increasingly attractive to residents as a premier living destination with improved quality, parking and access to facilities/amenities available at affordable rents, attracting demand the Cranleigh School due to open in 2014 along with the New York University. from existing residents seeking to upgrade and obtain better value for money accommodation. ƒƒ With its prime position on the Corniche and lifestyle offering, Nation Towers is expected to become one of the ƒƒ Older lower quality buildings have seen their vacancy levels reduce over the last three months where pricing had most sought after addresses in the city after having secured a high level of pre-leasing activity. been adjusted appropriately to tap into this segment of the market. ƒƒ Developments such as Al Muneera and Al Zeina are likely to remain popular as the communities are becoming ƒƒ Villa developments offering good community facilities (i.e. Golf Gardens and Mangrove Village) remained established with supporting retail and F&B outlets due to open during the year. popular and achieved premiums compared to standalone villas. ƒƒ There is currently a lack of good quality villa communities in Abu Dhabi and hence the existing villa developments will continue to prove popular.

Leasing Terms and ƒƒ The market standard for rent payment terms was two cheques without additional costs, while some landlords ƒƒ Similar lease terms are expected to be the norm in 2013, with landlords of the most desirable developments / Incentives accepted more instalments but at a premium (usually around AED5,000 per extra cheque). units less willing to negotiate compared to those likely to accept more instalments to secure tenants. ƒƒ Some landlords of prime buildings in the city did not offer any incentives due to sufficient demand. ƒƒ Expatriate landlords with mortgage commitments are also more likely to offer better leasing terms and / or incentives in order to cover their mortgage repayments.

Supply and Demand ƒƒ Close to 9,000 units were handed over on the mainland in 2012 most notably in the form of Al Reef Villas and ƒƒ A large percentage of the upcoming new supply for 2013 will be located on Reem Island with the expected Al Reef Downtown, Rayyana by Sorouh next to the Abu Dhabi Golf Course, Al Muneera and the last phases of completion of approximately 5,900 units, comprising the Gate District and a number of standalone towers on Al Zeina at Al Raha Beach. Shams Abu Dhabi. ƒƒ Close to 2,800 units were handed over in Marina Square on Reem Island this year, excluding Tala Tower which ƒƒ Good quality apartments will be delivered on the main Abu Dhabi Island in the Bateen Area in the form of is anticipated for handover in 2013. Marasy by ICT, as well as on Saadiyat Island, by TDIC. ƒƒ On the main island, the major new developments included Rihan Heights next to the Grand Mosque with over ƒƒ In terms of affordable supply, several buildings located within the Reef Downtown development will provide 860 residential units. additional apartments, whereas the Hydra Village development close to Shahama will deliver townhouses. ƒƒ Most of these new developments are part of the “new Abu Dhabi” and as such have benefited from good demand levels as tenants were keen to upgrade to better quality accommodation.

03 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com Residential Leasing Apartments

Average Apartment Rental Rates (AED ‘000s/pa) % Change Map Studio 1 BR 2 BR 3 BR % Change Location (Q4 2011- Key (Q3- Q4 2012) Q3 Q4 Q3 Q4 Q3 Q4 Q3 Q4 Q4 2012) From To From To From To From To From To From To From To From To PRIME BUILDINGS 1 Corniche n/a n/a n/a n/a 75 95 75 90 100 155 100 145 160 220 150 210 -4% -17 % 2 Khalidiya / Bateen n/a n/a 45 60 75 95 75 90 100 140 110 135 145 175 140 170 -1% -12% 3 Mushrif / Karama / Manaseer n/a n/a n/a n/a 60 70 60 70 95 115 90 110 115 135 110 130 -3% -16% 4 Central Abu Dhabi 45 50 45 50 65 75 60 70 95 120 95 120 120 140 120 140 -1% -15% 5 / 18 Tourist Club Area / Mina n/a n/a n/a n/a 65 70 60 70 95 115 90 115 115 140 115 140 -2% -17% 6 Al Nahyan Camp / Muroor 50 55 50 55 65 75 65 75 95 120 90 110 120 155 95 140 -7% -18% 9 / 8 MBZ / Mussafah 30 40 30 40 35 45 35 45 55 65 55 65 75 85 75 85 0% -17% 13 / 28 Khalifa A & B 30 40 30 40 35 45 35 45 55 65 55 65 75 85 75 85 0% -6% 7 Shams Abu Dhabi n/a n/a n/a n/a 90 100 90 100 120 130 125 135 145 160 150 165 3% -1% 7 Marina Square 55 65 55 65 65 85 75 85 95 110 95 120 130 150 130 150 3% n/a 14 Al Raha Beach 75 80 75 80 90 115 80 115 105 150 115 160 135 210 150 220 3% -10% LOWER QUALITY BUILDINGS 1 Corniche n/a n/a n/a n/a 65 75 55 70 75 90 75 90 100 125 100 125 -3% -19% 2 Khalidiya / Bateen n/a n/a n/a n/a 55 65 55 65 65 75 65 75 90 100 85 100 -1% -16% 3 Mushrif / Karama / Manaseer 30 40 30 40 45 55 45 55 55 65 55 65 70 80 75 80 1% -14% 4 Central Abu Dhabi 30 40 30 40 40 55 40 55 55 65 55 65 75 85 75 85 0% -16% 5 / 18 Tourist Club Area / Mina n/a n/a n/a n/a 45 55 45 55 65 75 65 75 75 85 75 85 0% -10% 6 Al Nahyan Camp / Muroor n/a n/a n/a n/a 50 60 50 60 65 75 65 75 75 85 75 85 0% -5% 9 / 8 MBZ / Mussafah 22 30 22 30 30 40 30 40 35 40 35 40 55 65 55 65 0% -7% 13 / 28 Khalifa A & B 22 30 22 30 30 40 30 40 35 40 35 40 55 65 55 65 0% -7%

04 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com Residential Leasing Villas

Average Villa Rental Rates (AED ‘000s/pa) % Change Map 2 BR 3 BR 4 BR 5 BR % Change Location (Q4 2011- Key (Q3- Q4 2012) Q3 Q4 Q3 Q4 Q3 Q4 Q3 Q4 Q4 2012) From To From To From To From To From To From To From To From To 2 Khalidiya / Bateen n/a n/a n/a n/a 160 220 160 220 180 285 180 280 250 300 220 290 -3% 5% 6 Al Nahyan Camp / Muroor n/a n/a n/a n/a 150 200 150 200 170 250 170 250 230 300 230 300 0% -3% 3 Mushrif / Karama / Manaseer n/a n/a n/a n/a 150 190 150 190 160 255 160 255 180 300 180 300 0% -7% 9/8 MBZ / Mussafah n/a n/a n/a n/a 80 110 80 105 110 145 110 145 115 165 115 165 -1% -9% 13/28 Khalifa A & B n/a n/a n/a n/a 90 105 90 105 110 155 110 155 125 215 125 215 0% -11% 10 Sas Al Nakhl n/a n/a n/a n/a 155 165 150 160 175 185 170 180 240 275 235 270 -3% -17% 12 Al Raha Gardens n/a n/a n/a n/a 140 165 150 180 150 230 180 220 260 290 255 280 2% -3% 11 Golf Gardens n/a n/a n/a n/a 170 210 165 210 230 300 225 295 300 330 300 380 2% -8% 15 Al Reef 80 90 80 90 95 110 95 110 125 130 120 130 145 155 145 155 -1% -17% 20 Saadiyat Beach n/a n/a n/a n/a 270 275 270 275 290 315 290 315 500 800 500 800 0% 0% 14 Al Raha Beach n/a n/a n/a n/a 195 250 190 250 290 310 280 310 n/a n/a 300 350 -1% -1% 25 Hills Abu Dhabi n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a 280 310 280 310 0% -5%

05 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com Summary H2 2012 and Outlook H1 2013 Residential Sales – Apartments and Villas

H2 2012 H1 2013

Transaction Activity ƒƒ Transaction activity has improved during 2012 in comparison with 2011, driven by the delivery of Investment ƒƒ The level of transaction activity will be influenced by the outcome of the discussions between the UAE Central Area stock, with Raha Beach, Reem Island and Saadiyat Island all seeing improvements in sales volumes of Bank and Emirates Bank Association on mortgage caps. completed properties. ƒƒ Al Reef recorded the highest number of transactions for villas and apartments, given the affordable price points, attractive rental yields and lack of competition in this segment of the market.

Popular ƒƒ Al Reef Villas and Downtown were the most popular developments among expatriate buyers due to affordability. ƒƒ There are a number of Investment Area developments due for delivery in 2013, with major additions including Developments and ƒƒ Villa communities including Raha Gardens and Golf Gardens have also remained popular among UAE National The Gate District at Shams Abu Dhabi, Mangrove Place, Al Wifaq Tower, Marina Bay and Tala Tower. This will Unit Types buyers due to attractive rental yields. increase the choice of ready to move in properties for prospective owner-occupiers and investors. ƒƒ At the high end of the market, the Saadiyat Beach Villas have attracted good levels of demand with transaction volumes increasing post handover. Demand has been further boosted by the recent announcement of the Louvre Museum’s main contract being awarded.

Buyer Profile and ƒƒ Due to low interest rates on deposits many UAE Nationals and expatriates used their savings and bonuses ƒƒ The buyer profile and reasons for buying are likely to remain similar to 2012, although an increasing amount Reasons for Buying to purchase income generating assets. This led to an increase in the number of investors compared to owner of owner-occupiers may enter the market as Investment Area developments become more self sufficient and occupiers, with investors representing about 70% of buyers. attractive communities to live in. ƒƒ The majority of investment buyers were UAE Nationals.

Trends ƒƒ Low interest rates by banks have resulted in a rise in property investments. ƒƒ We anticipate gradual improvements in sales transactions during 2013 driven by Investment Area developments ƒƒ The continued delivery of real estate in 2012 had a positive effect on market confidence. becoming more self sufficient and livable communities, for example with the opening of Paragon Mall at Marina Square and the Repton School on Shams , which is likely to improve demand from owner-occupiers and investors.

06 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com 25,000 25,000 23,236 23,236

21,007 21,007

20,000 20,000 18,778 18,778

15,200 15,200 15,000 15,000 2 2 AED/m AED/m 10,452 10,452 10,000 10,000 City of Lights City 27%of Lights (4,50627% Units) (4,506 Units) Shams Abu Dhabi Shams Abu Dhabi 49% 4,605 (8,03749% Units) 5,000 4,605 Najmat (8,037 Units) 5,000 3% Najmat(521 Units) 3% (521 Units)

Marina Square 1,399 Marina21% Square 1,399 (3,48521% Units) (3,485 Units) 0 0 2011 2012 2013 2014 2015 2016 2017 2011 2012 2013 2014 2015 2016 2017 Shams Abu Dhabi Marina Square Najmat City of Lights Potential Supply Total Shams Abu Dhabi Marina Square Najmat City of Lights Potential Supply Total

Residential Sales Apartments Average Apartment Sales Price and Percentage Change (Q3-Q4 2012 and Q4 2011-Q4 2012) 14,000 Average Apartment Sales Price and Percentage Change (Q3-Q4 2012 and Q4 2011-Q4 2012) 14,000 4.3% +1% +0.9% +3.9% +3.3% 0% -3.7%4.3% -7.7%+1% -10%+0.9% -9%+3.9% -9%+3.3% -4.5%0% 12,000 -3.7% -7.7% -10% -9% -9% -4.5% 12,000

10,000 10,000

2 8,000

2 8,000

AED/m 6,000 AED/m 6,000

4,000 4,000

2,000 2,000 9,949 10,380 11,186 11,294 11,724 11,832 9,573 9,949 9,681 10,003 5,916 5,916 9,949 10,380 11,186 11,294 11,724 11,832 9,573 9,949 9,681 10,003 5,916 5,916 0 0 Marina Square Shams Abu Dhabi Al Raha Beach / Al Bandar Al Raha Beach / Al Zeina Al Raha Beach / Al Muneera Al Reef Downtown Marina Square Shams Abu Dhabi Al Raha Beach / Al Bandar Al Raha Beach / Al Zeina Al Raha Beach / Al Muneera Al Reef Downtown Q3 2012 Q4 2012 Percentage Change (Q3-Q4 2012) Percentage Change (Q4 2011-Q4 2012) Q3 2012 Q4 2012 Percentage Change (Q3-Q4 2012) Percentage Change (Q4 2011-Q4 2012)

Villas

Average Villa Sales Price and Percentage Change (Q3-Q4 2012 and Q4 2011-Q4 2012) Average Villa Sales Price and Percentage Change (Q3-Q4 2012 and Q4 2011-Q4 2012) 5 5 -5% 0% -2% -6%-5% -4%0% 4.2 +2%-2% -6% -4% 4.2 +2% 4 4 3.3 3.2 3.3 3.2 3 3 2.4 2.3 2.4 2.3 2.0 1.8 2 2.0 1.8 1.6 2 1.6 1.3 1.0 1.3 Average Price Point in AED Million Average 1.0 Average Price Point in AED Million Average 1 1

0 0 Al Raha Gardens Golf Gardens Al Reef Villas Al Raha Gardens Golf Gardens Al Reef Villas 2 BR 3 BR 4 BR 5 BR Percentage Change (Q3-Q4 2012) Percentage Change (Q4 2011-Q4 2012) 2 BR 3 BR 4 BR 5 BR Percentage Change (Q3-Q4 2012) Percentage Change (Q4 2011-Q4 2012)

07 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com Summary H2 2012 and Outlook H1 2013 Commercial Leasing - Offices

H2 2012 H1 2013

Transaction Activity ƒƒ Transaction activity in the office leasing market was dominated by the government sector, with several entities ƒƒ Large space requirements will continue to come from government entities and state owned enterprises, including Abu Dhabi Tourism Authority, Ministry of Economy and the Department of Transport taking up a although some of this demand is earmarked for purpose built HQ developments (i.e. Abu Dhabi Investment substantial amount of office space. Council, Al Hilal Bank and Abu Dhabi Islamic Bank). ƒƒ Private sector demand has also increased, although requirements are generally small (less than 500 m2). ƒƒ Transaction activity will continue to improve in the private sector on the back of improving economic conditions ƒƒ The Mawaqif parking system has led to many SMEs relocating from lower quality buildings without parking to driven by the government’s economic diversification initiatives and infrastructure spending, which will drive better quality buildings, offering allocated basement parking. employment growth. ƒƒ Businesses previously adopting a wait-and-see attitude relocated to new better quality offices as lease rates ƒƒ SMEs will continue to have a preference for smaller, fully-fitted offices with parking. became more affordable.

Popular Developments ƒƒ The offices at Nation Towers, which were offered to the market at competitive rents, were close to being 100% ƒƒ The Landmark Tower, which is expected to be handed over in 2013 and occupies a prime position on the pre-let due to the prime location and link to the St Regis Hotel and the Nation Galleria (retail). Corniche is likely to prove a popular development for government entities. ƒƒ Similarly, IPIC Headquarters on Muroor Road were fully leased to a variety of government, semi-government ƒƒ Similarly, the Al Bustan Complex, located on Airport Road, is expected to comprise Grade A quality fitted offices and private entities. as well as a good parking ratio and is likely to generate good demand.

Leasing Terms and ƒƒ Grade A developments continued to hold headline rental levels, although rent free periods have increased to ƒƒ The additional supply due to enter the market will outstrip demand, leading to further downward pressure on Incentives attract/retain tenants. occupancy and rental rates, while tenants will continue to enjoy strong negotiating power. ƒƒ Landlors of lower grade properties were generally more flexible in regards to the rental rate and accepted multiple payments (up to four instalments) with increased rent free periods.

Average Office Rental Rates and Percentage Change (AED/m2/pa)

% Change Q3 Q4 % Change (Q3-Q4 2012) (Q4 2011-Q4 2012) Grade B Grade A Grade B Grade A Grade B Grade A Grade B Grade A

Recent Fitted 900 1,800 800 1,600 -11% -11% -20% -16% Build Shell & core 750 1,250 700 1,200 -7% -4% -22% -11%

From To From To From To From To

Good Quality 700 1,100 700 1,050 0% -5% -22% -13% Building Mature Typical Building 650 750 650 750 0% 0% 0% 0% Stock Low Quality 550 600 550 600 0% 0% 0% -8% Building

08 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com Reem Island Overview

ƒƒ Reem Island, located close to the eastern shores of the Abu Dhabi Island, is one of the Emirate’s largest Investment Areas. ƒƒThe island is located to the East of the Tourist Club Area and Al Maryah Island, the new financial district of Abu Dhabi formerly known as Sowwah Island. ƒƒWhen initially launched in 2005, Reem Island was divided among three master developers, Tamouh (60%), Sorouh (20%) and Reem Investors (20%). ƒƒWhilst certain developments such as Marina Square and the Gate District have been / are being fully developed by the master developer, the majority of the island was sub-divided into plots that were sold to sub-developers.

Investment Area Status (courtesy of Al Tamimi) ƒƒ The Investment Area status allows non-UAE Nationals (natural or legal persons) to own apartments units or entire floors in buildings for a period of 99 years. The right of ownership does not include any right to share in the ownership of the underlying land. ƒƒIn Investment Areas, non-UAE nationals may also acquire: � a right of usufruct (the right to use and exploit property belonging to another person) for a period of up to 99 years; and � a right of musataha (the right to build and develop on land belonging to another person) for a period of up to 50 years ƒƒGCC Nationals (and legal entities wholly owned by them) are granted the right to own freehold land within Investment Areas. ƒƒUAE Nationals have the right to freehold ownership to property anywhere in the Emirate of Abu Dhabi. ƒƒOther areas identified as Investment Zones in Abu Dhabi include Saadiyat Island; Lulu Island; Al Raha Beach; Al Reef; Al Reem Island; Al Maryah Island; Yas Island; Seih Al Suderah; Masdar City.

09 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com Reem Island Overview Infrastructure & Supporting Facilities ƒƒ Significant infrastructure works have been completed by the master developers over the last few Retail years, including bridges, road networks, canals, beaches, power networks and substations, sewage ƒƒ The Boutik Mall at Sun & Sky Towers, which extends to 13,400 m2 of net leasable space, opened in pumping stations, irrigation networks, storm and potable water networks, street lighting, etc. 2012 and includes a Waitrose supermarket. ƒƒParagon mall is anticipated to open at Marina Square during the course of 2013 and will feature Roads and Bridges around 120 retail outlets and a cinema. Marina Square also benefits from a Géant supermarket as ƒƒ To date, there are two bridges connecting Reem Island to the main Abu Dhabi Island, one accessible well as a number of small convenience stores. via 11th Street, the other, recently opened, connecting Al Falah Street (9th Street) to Reem Island via Al Maryah Island. Hotel ƒƒConnecting Marina Square, Shams and Najmat has been completed but with limited or no ƒƒ A hotel was under development at Marina Square but construction has stopped and a delivery date infrastructure development so far in Abu Dhabi Downtown and Reem South Island. is unclear. ƒƒThe closest hotels include the Rotana Hotel, the upcoming Rosewood Hotel on Al Maryah Island Schools and the Meridien Hotel. ƒƒ Sorbonne Abu Dhabi University opened in December 2009, is situated within the Reem Central area and accommodates around 600 students. Offices ƒƒSorouh recently announced the opening of Repton’s first campus on Shams Abu Dhabi in September ƒƒ Two office buildings have already been handed over, the Tamouh Tower (previously known as 2013. “Infinity Tower”) at Marina Square and 40 floors of offices at Sky Tower at Shams Abu Dhabi. ƒƒOther office towers are also anticipated at City of Lights including Addax Tower and Omega Tower.

MARINA SQUARE SHAMS ABU DHABI CITY OF LIGHTS

010 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com Reem Island Supply

ƒƒ There are currently 4,605 completed units on Reem Island. Reem Island Upcoming Supply* 25,000 25,000 ƒƒAn additional 5,847 units are scheduled for completion in 2013. The majority of this new supply will be delivered at Shams Abu Dhabi including the Gate District, Sea View Tower, Mangrove Place, Al 23,23623,236 Wifaq Tower, Beach Towers, Oceanscape and Reem Diamond. ƒƒThere is some uncertainty on the delivery timescales of City of Lights. As at the end of 2012, 11 towers, which will provide approximately 4,500 residential units and an office tower, were at a 21,00721,007 relatively advanced construction stage. However, the development has seen limited activity over the

last 18 months. For the purposes of our forecast we have assumed handover will commence at the 20,000 20,000 end of 2014. 18,77818,778 ƒƒOther projects previously announced but currently on hold have been accounted for as potential supply. ƒƒIf all projects were delivered, Reem Island would have over 23,000 residential units by 2017, representing over 10% of the total residential supply in Abu Dhabi. 15,20015,200

15,000 2015 Projected Supply Distribution* 15,000 (based on projects currently under construction) 2 2 AED/m AED/m 10,45210,452

10,000 10,000

CityCity ofof LightsLights 27%27% (4,506(4,506 Units)Units)

ShamsShams AbuAbu DhabiDhabi 49%49% 4,6054,605 (8,037(8,037 Units)Units) 5,000 5,000 NajmatNajmat 3%3% (521(521 Units)Units)

MarinaMarina SquareSquare 1,3991,399 21%21% (3,485(3,485 Units)Units)

00 20112011 20122012 20132013 20142014 20152015 20162016 20172017

ShamsShams Abu Abu Dhabi DhabiMarina Marina Square SquareNajmat NajmatCity City of of Lights LightsPotential Potential Supply SupplyTotal Total *Supply figures do not include any new / previously unannounced projects that could come to the market during these timescales.

011 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com

AverageAverage Apartment Apartment Sales Sales Price Price and and Percentage Percentage Change Change (Q3-Q4 (Q3-Q4 20122012 andand Q4Q4 2011-Q42011-Q4 2012)2012) 14,00014,000 4.3%4.3% +1%+1% +0.9%+0.9% +3.9%+3.9% +3.3%+3.3% 0%0% -3.7%-3.7% -7.7%-7.7% -10%-10% -9%-9% -9%-9% -4.5%-4.5% 12,00012,000

10,00010,000 2 2 8,0008,000 AED/m AED/m 6,0006,000

4,0004,000

2,0002,000 9,949 10,380 11,186 11,294 11,724 11,832 9,573 9,949 9,681 10,003 5,916 5,916 9,949 10,380 11,186 11,294 11,724 11,832 9,573 9,949 9,681 10,003 5,916 5,916

00 MarinaMarina Square Square ShamsShams Abu Abu Dhabi Dhabi AlAl Raha Raha Beach Beach / /Al Al Bandar Bandar AlAl Raha Raha Beach Beach / /Al Al Zeina Zeina AlAl Raha Raha Beach Beach / /Al Al Muneera Muneera AlAl Reef Reef Downtown Downtown

Q3Q3 2012 2012 Q4 Q4 2012 2012 Percentage Percentage Change Change (Q3-Q4 (Q3-Q4 2012) 2012) PercentagePercentage ChangeChange (Q4(Q4 2011-Q42011-Q4 2012)2012)

AverageAverage Villa Villa Sales Sales Price Price and and Percentage Percentage Change Change (Q3-Q4 (Q3-Q4 20122012 andand Q4Q4 2011-Q42011-Q4 2012)2012)

55 -5%-5% 0%0% -2%-2% -6%-6% -4%-4% 4.24.2 +2%+2%

44 3.33.3 3.23.2

33 2.42.4 2.32.3 2.02.0 1.81.8 22 1.61.6 1.31.3 1.01.0 Average Price Point in AED Million Average Average Price Point in AED Million Average 11

00 AlAl Raha Raha Gardens Gardens GolfGolf Gardens Gardens AlAl Reef Reef Villas Villas

22 BR BR 33 BR BR 44 BR BR 55 BR BR PercentagePercentage Change Change (Q3-Q4 (Q3-Q4 2012) 2012) PercentagePercentage ChangeChange (Q4(Q4 2011-Q42011-Q4 2012)2012) Reem Island – Development Activity

SUN & SKY TOWERS THE GATE TOWERS AMAYA TOWERS SEA VIEW TOWER MANGROVE PLACE BEACH TOWERS 2011 2013 2012 2012 2013 2013 SHAMS SHAMS SHAMS SHAMS SHAMS SHAMS

AL WIFAQ TOWER REEM DIAMOND OCEANSCAPE MARINA BAY MARINA SQUARE – 14 TOWERS 2013 2013 2013 2013 2011-2013 SHAMS SHAMS SHAMS SHAMS MARINA SQUARE

012 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com Property Focus

Marasy - Al Bateen Wharf

Location ƒƒ The development is located on 34th St. (Baynunah St.) behind the Central Bank of UAE, near Marina Sports Club ƒƒ Situated less than two kilometres from the Corniche within the affluent Al Bateen district of Abu Dhabi, it occupies a prime position overlooking the Al Bateen Wharf and Marina ƒƒ Easy access to local amenities (Marina Mall 5 minutes drive) ƒƒ Proximity to prime hotels (Intercontinental and Jumeirah) with high end F&B outlets

Developer International Capital Trading (ICT)

Number of Units 369 luxury apartments spread across eight low rise glazed buildings with a mix of loft style and simplex units (Studios, 1, 2, 3 & 4 bedroom apartments)

Facilities and ƒƒ An exclusive and unique water fronting residential development set to become one of the Amenities premier residential addresses in Abu Dhabi ƒƒ Attractive modern contemporary finishes with fitted kitchen appliances ƒƒ Balconies offering water views ƒƒ Self contained community with supporting retail and F&B facilities ƒƒ High quality community leisure facilities, including large swimming pool, children’s pool and gymnasium ƒƒ Private boat mooring for 52 Berth ƒƒ Attractive environment with landscaped gardens and waterfront promenade ƒƒ Basement parking ƒƒ Community retail ƒƒ 24 hours security system

Completion ƒƒ Building 8 has been leased and is now occupied ƒƒ Remaining buildings are due to be released in phases starting Q1 2013

Rental Sizes & Unit Type Unit Size (m2) Rental Rate (AED/pa) Prices 1 BR 96 – 104 From 87,000 2 BR 147 – 208 From 135,500 3 BR Simplex 205 – 246 From 185,500

013 For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com Law Update - Al Tamimi & Co.

Ministerial Resolution No. 418 of 2012 on Amending Some Provisions of the Executive Regulation of the Entry and Residency Law for Foreigners: ƒƒWhere the person is the owner of a property in the United Arab Emirates, the General Directorate of Residence and Foreigners Affairs and the consular entities that represent the United Arab Emirates abroad shall grant a visa, when necessary, for entry to the United Arab Emirates for a foreigner wishing to enter the United Arab Emirates. ƒƒThe permit or visa may include the spouse and the children of the property owner. ƒƒThe property owner may enter the United Arab Emirates multiple times over the six months following the date of issuing the visa and he may stay as long as the visa is valid.

Ras Al Khaimah Law 9 of 2012 Regulating Acquisition of Properties of Public Benefit His Highness Shaikh Saud Bin Saqr Al Qasimi, Supreme Council Member and Ruler of Ras Al Khaimah, issued Law no. 9 of 2012 regulating acquisition of properties for projects of public benefit (“the Law”). RAK is the first Emirate in the UAE to issue an acquisition law. The Civil Code contains two provisions concerning acquisitions of property; therefore more rules and details were required to govern acquisitions of property. The Law provides that no property may be acquired unless it is for a project whose aim is to fulfill a public benefit and suitable compensation is decided and given by the Compensation Committee. The Law defines an acquisition as “the expropriation of a property or the right of disposal or usufruct from theowner thereof or the right of support pursuant to the provisions of this Law”. A Compensation Committee shall be established pursuant to a Decree to be issued by the Ruler in order to evaluate property and estimate the appropriate compensation resulting from the acquisition of the property. Pursuant to Article 5 of the Law, “the Ruler shall resolve upon recommendation of the Government, RAK Municipality or the concerned department as the case shall be either the absolute acquisition of the property or the acquisition of the right of disposal or usufruct thereof for the use of the property for a limited period or the imposition of any of the rights of support thereof or any restriction on the practice of any of the rights originated from the ownership of the property. The Resolution shall contain a description of the acquired property. And the names of the owners thereof or the manager or possessor thereof and the owners of rights therein within 30 days of the date following the date of the issuance of the Acquisition Resolution.” The Law defines the basis for estimating the compensation of any property which has been acquired pursuant to this Law.

The above legal information is supplied courtesy of Al Tamimi & Company. (For more information go to www.tamimi.com.)

014 For additional information call +971 600 54 7773 or email [email protected] 35 Abu Dhabi Property Map 11

34

33

20 18

Arabian Gulf 5 19 17

32 7 4

16 1

2 6 15

31 3 14 11 12 22 30

23 11 13 33 24

21 25 10 33

29

28

22 8 9 11

1 Corniche 11 Golf Gardens 21 Hodariyat Island 31 Al Falah Community Development Project 26 2 Khalidiya / Bateen 12 Al Raha Gardens 22 Danet Abu Dhabi 32 Yas Island*

3 Mushrif / Karama / Manaseer 13 Khalifa City A 23 Embassy Area 33 Al Shahama

4 Central Abu Dhabi 14 Al Raha Beach* 24 Zayed Sports City 34 Al Bahia

5 Tourist Club Area 15 Al Reef* 25 Bain Jisrain 35 Al Rahba

6 Al Nahyan Camp / Muroor 16 The Marina 26 Al Mafraq 27 7 Reem Island* 17 Lulu Island* 27 Baniyas City 11 Sheikh Zayed Road

8 18 Al Mina 28 Khalifa City B 22 Abu Dhabi - Al Ain Road

9 Mohammed Bin Zayed (MBZ) City 19 Al Sowwah Island* 29 Al Shamkha 33 Sweihan Road

10 Sas Al Nakheel 20 Saadiyat Island* 30 Masdar Future City * Investment Areas

22 Asteco Property Management LLC

With over 25 years’ experience in the Middle East, Asteco’s Professional Services team brings together instructions where we can quickly apply resources to meet the client’s requirements. a group of the Gulf’s leading real estate experts. Our breadth of experience across all the main property sectors is underpinned by our sales, leasing Asteco’s network of offices in Abu Dhabi, Al Ain, Dubai, Northern Emirates, Qatar, Bahrain and Jordan and property management teams transacting in the market, and a wealth of research that supports not only provides a deep understanding of local markets but also enables us to undertake large our decision making.

Research Ras Al Khaimah Asteco’s Research Department provides investors and developers with essential real estate knowledge to Regional Offices and Operations Ajman ensure clients understand their competitors, target markets and their long-term strategies. Sharjah JORDAN Dubai Consultancy

UNITED ARAB Asteco’s Consultancy Department provides comprehensive advice on market trends and solid solutions, Abu Dhabi BAHRAIN EMIRATES from project concept to completion. Asteco’s consultancy reports stimulate initial investment to financial QATAR KINGDOM OF SAUDI ARABIA institutions and other private equity providers. Al Ain

Valuations UNITED ARAB EMIRATES The team is fully independent in its approach and adheres to the Royal Institution of Chartered Surveyors’ (RICS) valuation standards.

Sales John Allen Paul Maisfield Muath A. Jalil Julia Knibbs Asteco’s internationally qualified team has enjoyed over two decades of experience within the highly BSc MRICS BSc (Hons) MRICS dynamic Middle East property market. Director - Research, Consultancy GM & Head of Professional Head of Property Services, Senior Analyst, Abu Dhabi and Valuations Services, Abu Dhabi Abu Dhabi Leasing +971 4 403 7777 +971 2 626 2660 +971 2 626 2660 +971 2 626 2660 [email protected] [email protected] [email protected] [email protected] Asteco is the leading leasing agent in the UAE and is the sole agent for a number of key developments in the region. Jenny Weidling John Stevens Soby Joseph Vineet Kumar BSc MRICS Property Management Senior Research Analyst, Dubai Managing Director Head of Corporate Services Associate Director - Agency Asteco has provided management to over 4,500 buildings throughout the UAE, which include corporate +971 4 403 7777 +971 4 424 9444 +971 4 403 7777 +971 4 403 7777 portfolios and local and international funds. [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 Dubai market. 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 Licence No. 218551. Paid-up Capital AED4,000,000.

For additional information call +971 600 54 7773 or email [email protected] www.astecoreports.com