Qatar Real Estate Q1, 2020

www.alasmakhrealestate.com Indicators Q1 2020

Micro Economics – Current Standings Steady increase in population partially supports the demand for housing.

Delay in delivery of under Total Population* GDP at Current Price* construction projects is expected due to outbreak of pandemic in the region. 2,795,484 QAR 163.45 Billion Office supply in new CBD

areas mounts pressure on * Mar 2020 * Q2 2019 price correction in old town business districts.

Operation of metro in the vicinity of prime malls Industrial adds on to increased footfall. Producer Price Index* Production Index*

Government supports hospitality sector by 61.4 points 109.6 points converting hotels to quarantine centers. Ref: QSA * Sep 2019 * Aug 2019 Overall land rates are stabilizing across . No of Properties Sold Municipalities 923 Value of Properties Sold

Al Shamal QAR 6.06 Billion

Al Khor Ref: MDPS For the period December 2019. January 2020 and February 2020

Al Daayen Real Estate Price Index (QoQ) Umm Slal

Doha 300 8.0% 250 6.0% 4.0% 200 2.0% 150 0.0% -2.0% Al Wakra 100 -4.0% 50 -6.0% 0 -8.0% Jul-17 Jul-18 Jul-19 Jan-17 Jan-18 Jan-19 Sep-17 Sep-18 Sep-19 Mar-17 Nov-17 Mar-18 Nov-18 Mar-19 Nov-19 May-17 May-18 May-19

Ref: QCB 2 Residential Q1 2020

YTD Snapshot

Supply in Pipeline Expected Delivery Overall Available Units

360,000 90,000 units 2020

Q1 2020 Villa Occupancy

72%* Median Selling Price Median Rental Rate

Apartment Occupancy QAR 10,500 PSF QAR 6,500 (2BR)

60%*

Ref: AREDC Research

Current Annual Yield Key Demand Drivers 4.9%*

* Average 25% 13% Government Companies Residential Concentration Government and companies are taking residential units for their employees under HRA.

Residential Supply (Units) – YoY Comparison

500,000 450,000 400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000 - 2015 2016 2017 2018 2019 2020

Ref: AREDC Research 3 Residential Q1 2020

Residential Market Gauge Apartment Snapshot

Rental Rate* Sale Price* Q4 19 Q1 20 Micro markets (QAR/Month)** (QAR/PSM) Unit Sales The Pearl 11,000 11,000 Rental Trend 10,000 8,500 Occupancy Lusail 7,500 11,000 Overall Market C&D Ring Road 5,500 12,500

Downtown 5,000 12,500

Al Wakra 4,000 --

Al Khor 4,500 --

Ref: AREDC Research * Average ** For standard 2BR unit Market Outlook Apartment Rental Rates in Prime Areas The residential segment in Qatar 16,000 witnesses surge in inventory from 14,000 newly developed micro markets 12,000 10,000 towards northern peripheries of 8,000 Doha. Additionally well connected 6,000 4,000 roadway corridors to the vicinity to 2,000 0 the central districts of Doha has The Pea rl West Bay Lusail Bin Omran Al Old Al Mansoora Airport Muntazah worked wonders. Due to affordable Studio 1 Bedroom 2 Bedroom 3 Bedroom inventory available in the newly Ref: AREDC Research developed locations, pressure to sustain rentals and occupancy Rental Rates of Villas in Residential Compounds in Prime Areas mounts on the existing 35,000 neighborhoods. Average rentals 30,000 dips around 3% across all asset 25,000 classes in the residential segment 20,000 15,000 as compared to the previous 10,000 quarter Q4 2019. However 5,000 residential communities that are 0 West Bay Ain Khalid professionally maintained are able Lagoon to hold up the sustenance. 3 Bedroom 4 Bedroom 5 Bedroom Ref: AREDC Research 4 Office Q1 2020

YTD Snapshot

Supply in Pipeline Expected Delivery Total Leasable Area

4,800,000 sq.m 400,000 sq. m 2021-22

Q1 2020 Estimated Leasable Area

5,200,000 sq.m Median Rental Rate Common Grading

Occupancy QAR 100 PSM Class B

65%*

Ref: AREDC Research

Current Annual Yield Key Demand Drivers 6.2%*

* Average Affordable Better Rental Leasing Terms Office Concentration Class A office spaces are now affordable due to easy rental terms and lucrative rental rates.

Office Supply (sq.m) – YoY Comparison

6,000,000

5,000,000

4,000,000

3,000,000

2,000,000

1,000,000

- 2015 2016 2017 2018 2019 2020 2021 2022

Ref: AREDC Research 5 Office Q1 2020

Office Market Gauge Office Snapshot

Monthly Rental Q4 19 Q1 20 Occupancy Micro markets Rate (%)* Rental Trend (QAR/sq.m)*

Occupancy West Bay 120 67%

Sentiments C Ring Road 80 70%

Overall D Ring Road 70 65% Market Al Sadd 90 73%

Salwa Road 70 58%

Airport Road 90 65%

Old Slata 80 60%

Ref: AREDC Research * Average Market Outlook Office Sizes (sq.m) in Prime Areas The office segment yet to stabilize 700 occupancies and monthly rentals. 600 Surplus Office supply in Lusail City 500 and Musheireb Downtown shifts 400 300 the momentum towards price 200 correction in the existing Business 100 District.. The occupancies in West 0 West Bay C Ring D Ring Al Sadd Salwa Road Airport Old Slata Bay offices towers is in the range Road Road Road of 55% to 65% while asking Ref: AREDC Research monthly average rental ranges from QAR 100 to QAR 140 per sq. Average Occupancies (%) – By Grade m. The Suburban Business District (SBD) as in Doha downtown, C & D 80% 70% Ring road, Al Sadd, Salwa Road 60% 50% and Airport Road are commanding 40% monthly rentals ranges between 30% 20% QAR 70 to QAR 90 per sq. m while 10% the average occupancies in SBD is 0% West Bay C Ring D Ring Al Sadd Salwa Airport Old Salata around 65% Road Road Road Road Grade A Grade B Ref: AREDC Research 6 Retail Q1 2020

YTD Snapshot

Supply in Pipeline Expected Delivery Total Net Leasable Area

2,100,000 sq.m* 700,000 sq. m 2021

Q1 2020 Operating Malls

25 Upcoming Mall Median Rental Rate

Overall Occupancy 06 QAR 225 PSM

78%**

Ref: AREDC Research Median Mall Size Key Demand Drivers 55,000 sq.m* (NLA)

* * *Average Including upcoming malls Stabilized Brand Occupancy Retention Retail Concentration Most operational malls have higher and stabilized occupancy that support the mall’s rental income and its stability.

Net Leasable Area Distribution

14.0%

12.0%

10.0%

8.0%

6.0%

4.0%

2.0%

0.0% Villaggio Th e Mall Gulf Mall Th e Gat e Doha Mall Doha Landmark No rth gate Mu sh ei r eb … Th e Cent re Ezdan Mall Tawar Mall Hyatt Plaza Royal Plaza Royal Centrepoint Mi r qab Mal l Ma ri na Mal l Al Sadd Mall Sadd Al Dragon Dragon Mall Ma ll of Qat ar Lagoona Mall Lagoona Festival… Doha B Square Mall Square B Vendome Mall Vendome Barwa Al Doha Al Barwa Al Wakrah Mall Wakrah Al Med ina Centr al e Doha MallOutletDoha City Center Doha City Dar Al Salam Mall Salam Al Dar

Ref: AREDC Research 7 Retail Q1 2020

Retail Market Gauge Retail Snapshot

Showrooms Q4 19 Q1 20 Year Shopping Mall* (Street Shopping)* Rental Trend 2014 240 160 Occupancy 2015 250 140 Sentiments 2016 270 145 Overall Market 2017 260 140

2018 250 145

2019 240 140

Q1 2020 240 120

Ref: AREDC Research *Average Monthly Rental Rates (QAR/sq.m) Market Outlook Average Monthly Rentals in Prime Malls (QAR/sq. m) The highest concentration of the 350 malls is on Al Shamal Road where 8 300 250 malls are located with net leasable 200 area of 721,250 sq.m that is closed 150 to 33% of total net leasable area. 100 50 The monthly rental rates in the well 0 established malls are in the range of Qatar Mall Mall of Mall Villagio Doha Lagoon a Doha The Gate The Gulf MallGulf Land mark

QAR 200 to QAR 250 per sq.m. The City Cen ter Tawar Mall Tawar Festival City Festival Mirqab Mall Mirqab recent launch of Ref: AREDC Research connects many premium and region malls that offers higher Leasable Area in Operating and Upcoming Malls sq.m footfalls to the malls and easy access to the visitors. In upcoming 2 years, the expected supply of about 634,000 sq.m that is 42% of the current NLA is expected from 5 under construction mall.

Ref: AREDC Research 8 Hospitality Q1 2020

YTD Snapshot

ADR RevPAR Present Keys

28,903 QAR 306* QAR 211*

Q1 2020 Under-construction

3,280* Keys Occupancy Arriving Visitors

Planned 72%* 498,528**

4,780* Keys * Quarterly average of 5, 4 & 3 star categories Ref: MDPS ** Year till February 29th Current Annual Yield Key Demand Drivers 7.5%**

* Independent data. Regularly updated based on our research. ** Average Qatar Government Tourism Initiative Hotel Concentration Government initiatives to support healthcare by temporarily setting up COVID 19 quarantine facilities in 5 & 4 star hotels and visa-on- arrival from 80 countries uphold the hospitality sector in Qatar.

Distribution of Arriving Visitors by Region

10% 9%

7% 2% American European Asian & Oceania Other African 42% Other Arabs 31% GCC

Ref: MDPS 9 Hospitality Q1 2020

Hospitality Market Gauge Hotel Snapshot

Q4 19 Q1 20 Category No. of Hotels No. of Keys ADR Luxury Class 21 5,757 RevPAR Upper Upscale Class 24 6,345 Occupancy Upscale Class 11 2,168 Overall Market Upper Midscale Class 23 4,610

Midscale Class 26 3,526

Economy Class 38 6,497

Total 143 28,903

Ref: AREDC Research Market Outlook ADR Tracker QAR The previous two quarters 600 witnessed the launch of around 10 500 hotels and hotel apartments. Now 400 Qatar has 143 operational hotels 300 and hotel apartments with around 200 100 28,900 keys across all star 0 categories. More than 75% of room Jul-19 keys are still with 4-star or 5-star Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Aug-19 Sep-19 Oct-19 Nov-1 9 Dec-19 Jan-20 Feb-20 Mar-20 5 Star 4 Star 3 Star and 70% of keys are confined in Ref: AREDC Research West Bay alone. According to MDPS statistics, the average hotel Occupancy Tracker occupancy in 5 star hotel for 1st 100% quarter 2020 was around 65% while 80% Average Daily Rates (ADRs) and 60% Revenue per Available Room 40% (RevPAR’s) were QAR 511 and QAR 20% 330 respectively. 0%

Jul-19 Jan-19 Feb-19Mar-19 Apr-19May-19 Jun-19 Aug-19 Sep-19 Oct-19Nov-19Dec-19 Jan-20 Feb-20Mar-20

5 Star 4 Star 3 Star Ref: AREDC Research 10 Land Q1 2020

Land Market Gauge Key Transactions in Q1 2020

Q4 19 Q1 20 Location Municipality Amount (QAR) Land Price Al Wakra 623,670,521 Land Sale Al Wukair Al Wakra 433,406,482 Sentiments Al Wukair Al Wakra 199,149,285 Overall Market Al Wajibah Al Rayyan 110,000,000

Al Thumama Doha 68,360,150

Lusail Doha 42,624,000

Abu Hamour Al Rayyan 28,000,000

Market Outlook Ref: MoJ Average Residential Land Prices for Buildings (QAR/sq.ft) In Q1 2020, the land rates have 2,500 reduced marginally as compared to previous two quarters. Transactions 2,000 in villa segment recorded in Old 1,500 Airport and in Doha 1,000 municipality were in the range QAR 500 300 to QAR 350 per sq.ft. In Al Bu Hamour, of Al Rayyan - West Bay C Ring Ro ad A & B Ring Al Sadd Airport Road Old Salata Ro ad municipality were in the range QAR Ref: AREDC Research 300 to QAR 325 per sq.ft. In Al Wukair, Wakra municipality the land Average Commercial Land Prices for Buildings (QAR/sq.ft) transaction witnessed were in the 3,000 range QAR 200 to QAR 250 per sq.ft. 2,500 Various locations in other 2,000 neighboring municipalities of Doha, 1,500 the land parcels were transacted in 1,000 the range QAR 140 to QAR 300 per 500 sq.ft. The land for tower has not 0 recorded in 2019. West Bay C Ring Ro ad D Ring Road Al Sadd Salwa Road Airport Old Salata Ro ad Ref: AREDC Research 11 Qatar Real Estate Q1 2020

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§ IMF: International Monetary Fund. § Market Gauge § QSA: Qatar Statistics Authority - Bettering as compare to previous quarter § QCB: Qatar Central Bank - Remained stable as of previous quarter § MOJ: Ministry of Justice - Reducing as compare to previous quarter § IIF: The Institute of International Finance

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