Turkish lira plunge sees Gulf property investors flock to Istanbul

Turkish lira plunge sees Gulf property investors flock to Istanbul
Foreigners bought 5,367 properties in Turkey during the first quarter of 2018, compared to 4,316 last year. (AP)
Updated 25 August 2018

Turkish lira plunge sees Gulf property investors flock to Istanbul

Turkish lira plunge sees Gulf property investors flock to Istanbul

LONDON: The plunge in the value of the Turkish lira has fueled a foreign investor buying spree for Istanbul apartments, with the most interest coming from Gulf countries, according to market observers interviewed by Arab News.
Investors from the region are seeking to exploit the near 40 percent depreciation of the local currency against the dollar since January as a political spat with the US and market concern about the fragile Turkish economy has stoked a massive sell-off of the lira.
In an interview with Arab News, Cameron Deggin, founder of PropertyTurkey.com said: “In the last few weeks, unique visitor traffic to our site has more than doubled to over 5,000 a day. We can see from the data that most of the interest is from GCC countries, with Saudi Arabia — as the most populous GCC state — in the lead by a significant margin.”
Some of the Saudi interest, but not all, was from people who originally came from other Middle East states such as Jordan, Iraq and Tunisia, but who have had residency rights in KSA for many years, and in some cases are the children of families who arrived one two generations ago.
Over the past five years, Deggin said that Gulf investors had flocked to Istanbul, buying up apartments as second homes. This was more because they felt an affinity with Turkey as a Muslim country with a cultural vibe that they found appealing, rather than because they saw real estate as a canny investment, although the weakening lira has helped. That trend has accelerated this year as the currency crisis has intensified.
“You ask why GCC nationals are buying apartments that may fall further in value, and have already dropped about 35 percent? Well, my answer is that it’s because GCC investors are buying from the heart,” Deggin said. “At each training session, I tell my guys that GCC buyers might be saying they want an investment, but for 90 percent of them, the real motive is lifestyle. They just want a place in Istanbul. Investment is a secondary motive.
“Turkey is a stable country socially, culturally and demographically.”
Deggin predicted that when the lira stabilizes, the buying surge from outside the country will double as some investors with deep pockets were waiting on the sidelines as they were more risk averse.
Up to 2017, he said “if you had dollars in your pocket your investment was going up in value because the price increase was on average higher than the depreciation of lira.”
The big question now is what happens if the crisis worsens with a further cranking up of tensions between the US and Ankara.
Kate Everett-Allen, of global property consultancy Knight Frank, told Arab News: “Turkey has faced a number of political, economic and financial crises in recent years and yet, despite this, foreign interest has proved largely stable.”
Between January and March 2017, there were 4,316 sales to foreign buyers, in the same three-month period in 2018 this figure increased to 5,367 according to data from the Turkish Statistics Office, Turkstat.
For foreign investors, a 10 million-lira villa that would have cost roughly $1.9 million a few weeks ago, would now set them back only $1.57 million, a hypothetical saving of more than $300,000, according to Julian Walker, director of Spot Blue International Property, a London-based Turkish real estate portal, cited in a report by Mansion Global.
Walker said that tourism fuels the property market and this year had already been exceptional in spite of the state’s woes. Turkey logged a record 11.5 million foreign tourists in the first five months of 2018, a 30 percent jump over the same period last year, according to the Culture and Tourism Ministry.
Turkey saw a 22 percent spike in home sales to foreign buyers in 2017, according to a year-end report from the Turkish Statistical Institute.
However, not everyone is relaxed about the Turkish property market. The Guardian warned in a report on Aug. 23 that Turkey’s construction boom was built on cheap foreign loans and that with many construction materials sold in dollars, a crash could be round the corner with developers going bust.
Citing Kajin Bulut, who has worked in senior positions in forecasting and sales for a number of Turkish construction firms, told the Guardian: “The construction sector is like the head of a train — if it goes, the whole country goes.”


Saudi builder Binladin appoints turnaround specialists to senior team

Saudi builder Binladin appoints turnaround specialists to senior team
Updated 11 April 2021

Saudi builder Binladin appoints turnaround specialists to senior team

Saudi builder Binladin appoints turnaround specialists to senior team
  • The regional construction sector has been hit hard by the weakening of oil prices since 2014

RIYADH: Binladin International Holding Group (BIHG), the parent company of Saudi Arabia’s biggest builder, has hired two senior executives with a background in corporate turnarounds.
Balaji Prasad has been named group chief financial officer and Roberto Liuzza has been hired as group chief organization excellence officer.
Prasad has a background in debt restructuring, corporate turnaround, business transformation and complex fundraising. He was previously CFO of Abu Dhabi-listed developer Manazel.
Liuzza has also worked on a number of complex turnarounds across various industries, the company said in a statement on Sunday.
The regional construction sector has been hit hard by the weakening of oil prices since 2014 and the associated decline in the real estate sector which has plunged some of the industry’s biggest names into financial distress.
BIHG made a number of other senior appointments over the last year, including Ahmed Al-Sanie as group managing director; Abdulrahman Bajunaid as CEO of real estate; and Samer Khawashki as CEO of investments over the past year.
Established in March 2019, BIHG oversees and manages the affairs of units across its portfolio, including SBG – Saudi Arabia’s largest construction company and one of the world’s largest contractors.

 


Gulf hotels target staycationers with Ramadan price cuts as prices tumble

Gulf hotels target staycationers with Ramadan price cuts as prices tumble
Updated 11 April 2021

Gulf hotels target staycationers with Ramadan price cuts as prices tumble

Gulf hotels target staycationers with Ramadan price cuts as prices tumble
  • Ramadan deals are likely to push prices down further for many in the coming weeks

DUBAI: After one of the toughest years for the hotel industry in living memory, Gulf hoteliers are eyeing Ramadan as a springboard for recovery.
With international travel still severely limited, hotels are looking to attract so-called staycationers with deep discounts and deals during the holy month.

Prices are already historically low in many Gulf cities. The average daily room rate (ADR) at Dubai hotels was $145.90 in the first two months of 2021, down 13 percent from a year earlier, according to data provider STR. In Riyadh they were 11 percent lower at $151.40. Muscat experienced the biggest drop with a 52.5 percent slump to $75.10.

Ramadan deals are likely to push prices down further for many in the coming weeks. The holy month offers a further opportunity for Gulf hotels as families look to take some time off following a challenging year.
Hoteliers, including Raffles and Jumeirah in Dubai, W Abu Dhabi at Yas Island and Hilton Doha the Pearl in Qatar are all offering Ramadan staycation deals, especially for residents.
Wyndham is offering guests 15 to 25 percent off the best available rate when they stay three or more nights and book direct for stays between April 01 and Sept. 30.Accor is also offering discounts of up to 30 percent for stays through May 11.
Other traditional sources of Ramadan revenue will not be available to hotels. Only pilgrims who have been vaccinated or have already recovered from COVID-19 will be allowed to visit Makkah during Ramadan this year, while large gatherings for iftar meals will be limited throughout the region.
“The staycation market is a very useful means of filling demand when borders are closed and has been used with success right around the world,” Simon Allison, CEO of HOFTEL and organizer of this year’s GIOHIS summit in November, told Arab News. “In the end, as the domestic market is relatively limited it is almost inevitable that it will need to be offered discounts.”
However, with room rates already very low, hotels are looking at ways of attracting guests without pushing their margins into the red, such as resort credits.
For instance, Jebel Ali Beach Hotel Dubai is offering between 200 dirhams ($54.46) and 400 dirhams of credit redeemable toward food and beverages for guests booking more expensive rooms, and is only valid for UAE residents. IHG Hotels & Resorts has a staycation deal with free breakfast and dinner at its InterContinental, voco, Crowne Plaza and Holiday Inn properties in Saudi Arabia through Sept. 30.
“There’s no doubt that resort hotels and markets are performing much better than business ones,” said Kostas Nikolaidis, an executive at STR. “There’s also a significant difference between a domestic and an international stay. The length of stay, booking window as well as ancillary spending (F&B etc.) is different between an international and a domestic traveler.Hotels have tried to adjust in order to maximize their revenues in various ways.”Discounts are likely to extend way beyond Ramadan into the summer. The Saudi government announced in November 2020 that it would reopen domestic tourism this summer after 80 percent of citizens surveyed said they would rather holiday at home this year.
“Hotels focused on cost-cutting last year, which was inevitable,” said Allison. “Now they are working on staffing up again and getting the best people from a large available labor pool; focusing on sales and marketing strategies and means to differentiate their offering as travel gradually returns.”


Dubai’s non-oil trade tops $321.8 billion in 2020

Dubai’s non-oil trade tops $321.8 billion in 2020
Updated 11 April 2021

Dubai’s non-oil trade tops $321.8 billion in 2020

Dubai’s non-oil trade tops $321.8 billion in 2020
  • Total trade volume went down to 100 million tons, from 109 million tons in 2019
  • Exports rose eight percent to $45.47 billion while imports reached $186.8 billion

DUBAI: Dubai’s non-oil foreign trade reached $321.8 billion (1.185 trillion dirhams) in 2020, 13.5 percent lower than the previous year as the coronavirus pandemic weighed on activity.
Total trade volume dropped to 100 million tons, from 109 million tons in 2019, although shipments received a 6 percent boost in the second half of the year, the Dubai Media Office reported.
Exports rose eight percent to $45.47 billion while imports reached $186.8 billion, and re-exports totaled $89.58 billion.
“The exceptional growth performance of Dubai’s external trade sector reflects the emirate’s impressive resilience and its ability to recover and grow amidst international crises,” Sheikh Hamdan bin Mohammed bin Rashid Al-Maktoum, crown prince of Dubai and chairman of Dubai Executive Council, said in a statement.
“We were able to quickly renew our momentum of growth and reestablish our global leadership in various sectors.”
He added that the city has set an example for the world in dealing with both the economic and health repercussions of the COVID-19 pandemic. He further said that Dubai was quickly able to re-establish its global leadership in multiple sectors.
Sultan Ahmed Bin Sulayem, chairman and CEO of Dubai Ports World, meanwhile said: “With the gradual opening of borders, Dubai’s trade volumes started recovering and growing quickly in the second half of 2020.”
“This rebound is now spurring greater growth in 2021. The resumption of trade with Qatar, the start of trade engagement with Israel, the positive spin-offs from hosting EXPO 2020 and the launch of the Dubai 2040 Urban Master Plan will all contribute to accelerating the emirate’s growth momentum.”
China maintained its position as Dubai’s largest trading partner in 2020 with $38.66 billion worth of transactions, followed by India with $24.2 billion and the US with $16.6 billion.


PIF’s Noon signs partnerships with Abu Dhabi’s Man City FC

PIF’s Noon signs partnerships with Abu Dhabi’s Man City FC
Updated 11 April 2021

PIF’s Noon signs partnerships with Abu Dhabi’s Man City FC

PIF’s Noon signs partnerships with Abu Dhabi’s Man City FC
  • It will see Noon become the official online sales partner for Manchester City in the Middle East

DUBAI: Noon, an online platform backed by Saudi Arabia’s Public Investment Fund (PIF) and Dubai businessman Mohamed Alabbar, said it had signed a partnership with Manchester City, the English football club owned by Abu Dhabi.
It will see Noon become the official online sales partner for Manchester City in the Middle East.
Stephan Cieplik, a senior vice president at the club said: “The team has impressed us with their ambition, innovation, and passion for the local communities and businesses they serve in the Middle East.”
Noon was launched in the UAE and Saudi Arabia in December 2017 and in Egypt in February 2019. With an initial investment of $1 billion and working from headquarters in Riyadh, Noon said in 2016 that it aims to expand online sales in the region from 2 percent of the total retail market ($3 billion), to 15 percent ($70 billion) within a decade.
Manchester City is an English Premier League club initially founded in 1880. The club was bought by Abu Dhabi United Group (ABUG) in 2008 for a reported £210 million ($287 million) and is now owned by the City Football Group, which is majority owned by ABUG.


Masdar-led consortium starts construction of solar project in Jeddah

Masdar-led consortium starts construction of solar project in Jeddah
Updated 11 April 2021

Masdar-led consortium starts construction of solar project in Jeddah

Masdar-led consortium starts construction of solar project in Jeddah
  • The plant is locared in Third Jeddah Industrial City, 50 kilometers southeast of Jeddah

DUBAI: A consortium led by Abu Dhabi’s Masdar has started construction of a solar power plant in Jeddah, after reaching financial close on the project.

The consortium, which includes France’s EDF Renewables and Saudi Arabia-based Nesma Company, announced it will start construction of the 300-megawatt utility-scale plant that will begin operation next year.

The plant is locared in Third Jeddah Industrial City, 50 kilometers southeast of Jeddah.

“Saudi Arabia is fast developing into a global renewable energy player, and Masdar will continue to work closely with the Saudi government and our partners here to help the Kingdom achieve its clean energy transition,” Masdar chief Mohamed Jameel Al-Ramahi said in a statement.

The Kingdom’s Renewable Energy Project Development Office awarded the consortium the project after it had submitted the most competitive bid of SR60.9 ($16.2) per megawatt hour, the companies said.

The new plant forms part of Saudi Arabia’s clean energy strategy, where it wants to diversify its power mix and aims to generate 50 per cent of its electricity from renewable sources by 2030.

Crown Prince Mohammed bin Salman earlier signed seven power purchase agreements for new solar plants in Saudi Arabia following the inauguration of the Sakaka plant.