Mideast buyers look to new build homes in Manchester

Mideast buyers look to new build homes in Manchester
The Salford Quays area of Manchester (Shutterstock)
Updated 23 January 2018

Mideast buyers look to new build homes in Manchester

Mideast buyers look to new build homes in Manchester

LONDON: Bored of London? Manchester could be the next big thing for Middle East investors looking for decent returns on their high-end UK property investments.
Property prices are on the up, with the northern city’s residential market outperforming most other parts of the UK including London, according to a new report by Cluttons.
Values rose by 6.4 percent in the 12 months to November 2017, compared to just 2 or 3 percent for prime central London in the same time period.
The city is becoming a much more appealing place to live and invest in, the report said, aided in part by the decision to grant Manchester devolved powers allowing it to govern itself in a similar way to London.
The city’s mayor, Andy Burnham, has spearheaded efforts to create a media and tech hub that aims to rival London. Jobs are being created and new residential “London-style” residential developments are popping up in the city center, the report said.
All these factors combined are drawing the attention of the Middle East buyer, said Faisal Durrani, partner, head of research at Cluttons.
“The status of Manchester has certainly grown in the minds of Middle East investors over the last three years, with commercial property investment originating from the Middle East rising by almost 61 percent to £45 million at the end of 2016,” he said.
“The UK government continues to endeavor to raise the profile of Manchester and Birmingham as a ‘Northern Powerhouses’, and possible investment opportunities, however the family offices from the Gulf, however, need more convincing if these locations are to become more than peripheral targets,” he added.
The appeal of residential property is also growing, due partly to it being far cheaper than London. Average residential values stand around £150,000 ($209,00) or six times annual incomes. In contrast, the figure for prime central London is just under £3 million, or 70 times annual incomes. Residential rental yields in Manchester are close to six percent, while average monthly rents stand at £1,044.
“For Middle East high net worth individuals however, Manchester offers a viable alternative to London, or indeed an opportunity to broaden their UK property investment portfolios,” Durrani said.
He added that the city also had “world class” universities, good transport links to London and 56 direct flights a week between Manchester and the Gulf.
The report noted Middle East buyers were particularly interested in the city’s new-build schemes, saying these developments offered amenities such as concierge services, parking and gyms, that they may be used to in their home markets.
New-build property in Manchester has seen a 40 percent rise in transacted values over the last 18 months, which are now close to £240,000. This increase compares to the smaller rise of 13 percent for secondary market property transacted values.
Chinese investors have also shown increased interest in the city in recent years, spurred by the 2015 visit of China’s President Xi Jinping.
The Chinese government has also partnered with the UK to deliver the £800 million Manchester Airport city project, which intends to create 11,500 jobs once completed in the next 10 to 15 years.
For now, Manchester still lags behind London in terms of overall overseas investment, recording £1.4 billion worth of commercial property investment in 2017, compared to £25.2 billion in London.


Weekly energy recap: March 5, 2021

Weekly energy recap: March 5, 2021
Updated 10 min 46 sec ago

Weekly energy recap: March 5, 2021

Weekly energy recap: March 5, 2021
  • Many market participants were expecting that OPEC+ would restore as much as 1.5 million barrels a day of output in April
  • Many analysts had not taken into account the fact that global oil inventories remain well above the five-year average

Oil prices have escalated to the highest levels since October 2018. The Brent crude price is shyly approaching the vital $70 per barrel mark and closed the week at $69.36 per barrel. WTI closed the week at $66.09 per barrel.

Though global oil markets had anticipated an output increase from OPEC+, claiming the market can absorb one to two million additional barrels per day (bpd), OPEC+ took the market by surprise when it decided to roll over its quota, given the still-fragile global oil demand recovery.

The move is not about OPEC+ protecting the current price levels that have exceeded the pre-pandemic levels, it is not about refusing to bring more oil production online, it is not about dismissing any concerns about inflation and market overheating. The current oil price levels are not at astronomical high levels to add inflationary pressure to the global economy as it emerges from the pandemic.

Many market participants were expecting that OPEC+ would restore as much as 1.5 million barrels a day of output in April. However, they were only looking at the tip of the iceberg, focusing on high fuel demand in India, depleting global inventories, the rollout of vaccine programs and the financial stimulus packages that helped to improve market sentiment.

Many analysts had not taken into account the fact that global oil inventories remain well above the five-year average. Or, most importantly, the upcoming spring refineries maintenance season in Asia during the second quarter will further dampen crude oil supply.

On top of that, there has been a massive drop in the US refinery utilization rate, which has seen oil inventories jump by 21.6 million barrels, the biggest weekly rise since records began in 1982.

All these bearish developments make oil demand recovery uncertain in the short-term. Despite the fact that oil prices have rallied by about 30 percent since the start of 2021, OPEC+ producers are working tirelessly to drain the glut that built up during the pandemic last year, one of the worst periods in the history of the industry.


Saudi entertainment shares jump on easing of restrictions

Saudi entertainment shares jump on easing of restrictions
Updated 37 min 41 sec ago

Saudi entertainment shares jump on easing of restrictions

Saudi entertainment shares jump on easing of restrictions
  • The stock gained 5 percent in early trade

DUBAI: Saudi entertainment and retail shares gained on Sunday after the government said it would end most coronavirus-related restrictions, including resuming indoor dining and reopening cinemas, entertainment activities and events.

The sector has been one of the worst affected by a year of restrictions which has forced restaurants, cinemas and other venues to close their doors.
Entertainment giant Abdul Mohsen Al Hokair Group for Tourism and Development said all of its entertainment venues and cinema joint ventures would re-open on Sunday.
However, it said that the suspension of party and meeting halls as well as some other hotel facilities would continue until notified otherwise by the government.
The stock gained 5 percent in early trade.
Saudis will also be allowed to exercise in gyms following the relaxation of restrictions. Leejam Sports Company said it would re-open all of its facilities from Sunday.
Its stock rose 3.5 percent.


Saudi Ground Services slashes costs after year of worldwide flight disruption

Saudi Ground Services slashes costs after year of worldwide flight disruption
Updated 28 min 31 sec ago

Saudi Ground Services slashes costs after year of worldwide flight disruption

Saudi Ground Services slashes costs after year of worldwide flight disruption
  • The company services 28 airports across the Kingdom and processed more than 690,000 flights a year before the pandemic

DUBAI: Saudi Ground Services said it had slashed operating costs as it posted a loss caused by the collapse in global air travel.

The company which services 28 airports across the Kingdom and processed more than 690,000 flights a year before the pandemic, reported a total comprehensive loss of SR446.7 million ($118.9 million) for last year, it said in a Tadawul stock exchange filing.

“Despite the challenges faced by the company in light of the pandemic, Saudi Ground Services has executed several initiatives aimed at increasing the efficiency of operation and thus reducing the impact of the pandemic on the company’s profitability,” it said in the statement.

Companies that specialize in baggage handling, cargo and other airport services have been among the hardest hit over the last year as global air travel collapsed. Swissport, the world’s largest provider of ground and cargo handling services in the aviation industry, has axed thousands of jobs in response to the crisis in aviation. Smaller operators such as Hong Kong-based Jardine Aviation have also cut jobs.

Despite the challenges faced by Saudi Ground Services over the last year, it said that it had executed several strategies aimed at boosting efficiency which limited what would otherwise have been a much bigger hit to its business.

As a result, it reduced operating costs by some SR581 million in the current year, it said.
“In addition to cost reduction initiatives, the company has taken certain initiatives such as the opportunity to increase sales by providing disinfection services for aircraft in addition to other services which also contributed to reducing the impact of the pandemic on the company’s profitability.” it said.


UAE’s first independent digital banking platform launches

UAE’s first independent digital banking platform launches
Updated 07 March 2021

UAE’s first independent digital banking platform launches

UAE’s first independent digital banking platform launches
  • Global leaders in digital banking, such as Revolut, one of the world’s fastest-growing apps, do not have a UAE presence

DUBAI: The first independent digital banking platform in the United Arab Emirates launched on Sunday, a neobank hoping to become a leader in the Middle East, Africa and South Asia.

Dubai-based YAP does not have a banking licence itself but has partnered with RAK Bank which provides international bank account numbers for YAP users and secures their funds under its own banking licence.

YAP, like other neobanks which do not have physical branches, does not offer traditional banking services like loans and mortgages, but offers spending and budgeting analytics, peer-to-peer payments and remittances services and bill payments.

YAP is in the process of partnering with banks in other countries, head of product Katral-Nada Hassan said, including a bank in Saudi, in Pakistan and in Ghana.

Global leaders in digital banking, such as Revolut, one of the world’s fastest-growing apps, do not have a UAE presence.

Some UAE banks have in recent years launched their own digital banking offerings targeted at digitally-savvy and younger users, such as LIV by Emirates NBD and Mashreq Neo by Mashreq Bank.

Abu Dhabi state-owned holding company ADQ last year said it plans to set up an as-yet unnamed neobank using a banking licence of the country’s biggest lender, First Abu Dhabi Bank (FAB).

“The fintech revolution has become very popular in other parts of the world and we saw a gap and unique need for this service in the Middle East,” said YAP CEO and founder Marwan Hachem

Hassan said there are challenges for fintechs looking to expand to the UAE.

“There are a lot of fintechs right now looking at partnering with banks, but that requires a lot of discussion, relationship building ... It is not an easy thing to do,” she said, adding YAP’s founders had an existing relationship with RAK Bank.

YAP is at seed funding stage, funded by founders, a private equity firm and private investors, Hassan said, adding that more than 20,000 customers have pre-registered and accounts will gradually go live in coming weeks.


Escalating violence ups pressure for Myanmar sanctions

Escalating violence ups pressure for Myanmar sanctions
Updated 07 March 2021

Escalating violence ups pressure for Myanmar sanctions

Escalating violence ups pressure for Myanmar sanctions
  • The UN special envoy urged the Security Council to act to quell junta violence that this week killed about 50 demonstrators
BANGKOK: The escalation of violence in Myanmar as authorities crack down on protests against the Feb. 1 coup is raising pressure for more sanctions against the junta, even as countries struggle over how to best sway military leaders inured to global condemnation.
The challenge is made doubly difficult by fears of harming ordinary citizens who were already suffering from an economic slump worsened by the pandemic but are braving risks of arrest and injury to voice outrage over the military takeover. Still, activists and experts say there are ways to ramp up pressure on the regime, especially by cutting off sources of funding and access to the tools of repression.
The UN special envoy on Friday urged the Security Council to act to quell junta violence that this week killed about 50 demonstrators and injured scores more.
“There is an urgency for collective action,” Christine Schraner Burgener told the meeting. “How much more can we allow the Myanmar military to get away with?“
Coordinated UN action is difficult, however, since permanent Security Council members China and Russia would almost certainly veto it. Myanmar’s neighbors, its biggest trading partners and sources of investment, are likewise reluctant to resort to sanctions.
Some piecemeal actions have already been taken. The US, Britain and Canada have tightened various restrictions on Myanmar’s army, their family members and other top leaders of the junta. The US blocked an attempt by the military to access more than $1 billion in Myanmar central bank funds being held in the US, the State Department confirmed Friday.
But most economic interests of the military remain “largely unchallenged,” Thomas Andrews, the UN special rapporteur on the rights situation in Myanmar, said in a report issued last week. Some governments have halted aid and the World Bank said it suspended funding and was reviewing its programs.
Its unclear whether the sanctions imposed so far, although symbolically important, will have much ímpact. Schraner Burgener told UN correspondents that the army shrugged off a warning of possible “huge strong measures” against the coup with the reply that, “‘We are used to sanctions and we survived those sanctions in the past.’”
Andrews and other experts and human rights activists are calling for a ban on dealings with the many Myanmar companies associated with the military and an embargo on arms and technology, products and services that can be used by the authorities for surveillance and violence.
The activist group Justice for Myanmar issued a list of dozens of foreign companies that it says have supplied such potential tools of repression to the government, which is now entirely under military control.
It cited budget documents for the Ministry of Home Affairs and Ministry of Transport and Communications that show purchases of forensic data, tracking, password recovery, drones and other equipment from the US, Israel, EU, Japan and other countries. Such technologies can have benign or even beneficial uses, such as fighting human trafficking. But they also are being used to track down protesters, both online and offline.
Restricting dealings with military-dominated conglomerates including Myanmar Economic Corp., Myanmar Economic Holdings Ltd. and Myanmar Oil and Gas Enterprise might also pack more punch, with a minimal impact on small, private companies and individuals.
One idea gaining support is to prevent the junta from accessing vital oil and gas revenues paid into and held in banks outside the country, Chris Sidoti, a former member of the UN Independent International Fact-Finding Mission on Myanmar, said in a news conference on Thursday.
Oil and gas are Myanmar’s biggest exports and a crucial source of foreign exchange needed to pay for imports. The country’s $1.4 billion oil and gas and mining industries account for more than a third of exports and a large share of tax revenue.
“The money supply has to be cut off. That’s the most urgent priority and the most direct step that can be taken,” said Sidoti, one of the founding members of a newly established international group called the Special Advisory Council for Myanmar.
Unfortunately, such measures can take commitment and time, and “time is not on the side of the people of Myanmar at a time when these atrocities are being committed,” he said.
Myanmar’s economy languished in isolation after a coup in 1962. Many of the sanctions imposed by Western governments in the decades that followed were lifted after the country began its troubled transition toward democracy in 2011. Some of those restrictions were restored after the army’s brutal operations in 2017 against the Rohingya Muslim minority in Myanmar’s northwest Rakhine state.
The European Union has said it is reviewing its policies and stands ready to adopt restrictive measures against those directly responsible for the coup. Japan, likewise, has said it is considering what to do.
The Association of Southeast Asian Nations, or ASEAN, convened a virtual meeting on March 2 to discuss Myanmar. Its chairman later issued a statement calling for an end to violence and for talks to try to reach a peaceful settlement.
But ASEAN admitted Myanmar as a member in 1997, long before the military, known as the Tatmadaw, initiated reforms that helped elect a quasi-civilian government led by Aung San Suu Kyi. Most ASEAN governments have authoritarian leaders or one-party rule. By tradition, they are committed to consensus and non interference in each others’ internal affairs.
While they lack an appetite for sanctions, some ASEAN governments have vehemently condemned the coup and the ensuing arrests and killings.
Marzuki Darusman, an Indonesian lawyer and former chair of the Fact-Finding Mission that Sidoti joined, said he believes the spiraling, brutal violence against protesters has shaken ASEAN’s stance that the crisis is purely an internal matter.
“ASEAN considers it imperative that it play a role in resolving the crisis in Myanmar,” Darusman said.
Thailand, with a 2,400 kilometer (1,500-mile)-long border with Myanmar and more than 2 million Myanmar migrant workers, does not want more to flee into its territory, especially at a time when it is still battling the pandemic.
Kavi Chongkittavorn, a senior fellow at Chulalongkorn University’s Institute of Security and International Studies, also believes ASEAN wants to see a return to a civilian government in Myanmar and would be best off adopting a “carrot and stick” approach.
But the greatest hope, he said, is with the protesters.
On Saturday, some protesters expressed their disdain by pouring Myanmar Beer, a local brand made by a military-linked company whose Japanese partner Kirin Holdings is withdrawing from, on people’s feet — considered a grave insult in some parts of Asia.
“The Myanmar people are very brave. This is the No. 1 pressure on the country,” Chongkittavorn said in a seminar held by the East-West Center in Hawaii. “It’s very clear the junta also knows what they need to do to move ahead, otherwise sanctions will be much more severe.”