UAE residential market expands at ‘fastest pace since 2015’: Knight Frank

UAE residential market expands at ‘fastest pace since 2015’: Knight Frank
Villas in Dubai led the price surge - up by 5 percent in the same period and nearly 17 percent higher than they were at this time last year. (Shutterstock)
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Updated 29 September 2021

UAE residential market expands at ‘fastest pace since 2015’: Knight Frank

UAE residential market expands at ‘fastest pace since 2015’: Knight Frank
  • Prime locations in Dubai such as Palm Jumeirah and Emirates Hills accounted for nearly 75 percent of the home sales

DUBAI: A record 54 sales of Dubai homes valued more than $10 million and above was made during the third quarter of the year, in a new sign of recovery for the UAE’s real estate market. 

Residential property values in Dubai and Abu Dhabi, according to UK-based consultant Knight Frank, have expanded at their “fastest pace since 2015,” referring to data from the same period. 

“The market is roaring back to life,” Faisal Durrani, the consultancy firm’s head of Middle East research.

He said real estate confidence in the UAE is driven by how the government controlled COVID-19, as well as the excitement around the Dubai Expo that opens in October. 

“The UAE’s decisive, rapid and world leading response to the pandemic has caught the attention of the world’s wealthy who continue to flock to Dubai, snapping up the most expensive homes,” Durrani explained. 

Villas in Dubai led the price surge - up by 5 percent in the same period and nearly 17 percent higher than they were at this time last year. 

The market is roaring back to life.

Faisal Durrani, Knight Frank head of Middle East research

“Indeed, the number of $10 million plus homes sold currently stands at 54, smashing the previous record of 31, set back in 2015 – and there’s still three months left to run this year,” the Knight Frank consultant said. 

Prime locations such as Palm Jumeirah and Emirates Hills accounted for nearly 75 percent of the home sales, but new submarkets are emerging, Duranni said. 

“It was only a matter of time before the ‘halo-effect’ from Downtown Dubai spilled over to surrounding markets, highlighting that not only is Dubai’s super prime market expanding, but it is also maturing,” he explained. 

Residential values in Abu Dhabi are also on the rise - 2 percent higher than they were a year ago, also led by villas at  3.1 percent increase. Apartment prices grew 1.8 percent.

Home buyers were interested to get bigger homes, according to Knight Frank, reflected by rapid off-plan villa sales in the UAE capital. 


Iraq, Saudi ACWA Power close to signing a solar energy agreement

Iraq, Saudi ACWA Power close to signing a solar energy agreement
Updated 13 sec ago

Iraq, Saudi ACWA Power close to signing a solar energy agreement

Iraq, Saudi ACWA Power close to signing a solar energy agreement
  • The ministry said it is close to signing the agreement with the Saudi utility company to generate 1,000 megawatts of solar power in the Najaf Governorate.

CAIRO: Iraq is in advanced discussions to establish a solar energy project with Saudi Arabia’s ACWA Power, the oil ministry announced on its Facebook page. 

The ministry said it is close to signing the agreement with the Saudi utility company to generate 1,000 megawatts of solar power in the Najaf Governorate.


US records second-highest deficit of $2.77tn 

US records second-highest deficit of $2.77tn 
Updated 38 min 14 sec ago

US records second-highest deficit of $2.77tn 

US records second-highest deficit of $2.77tn 
  • In September, the budget deficit hit $62 billion, compared to a $125 billion deficit a year earlier and market expectations of a $60 billion gap

The US budget deficit in the fiscal year 2021 recorded the second-highest deficit ever compared to $ 3.132 trillion recorded in 2020, where the deficit for 2021 reached $ 2.772 trillion.

Revenue jumped 18.3 percent to $ 4.046 trillion amid higher income taxes on individuals and businesses due to the economy's recovery. In contrast, expenses rose by 4.1 percent to $6.818 trillion due to continued spending to counter the devastating effects of the global pandemic.

In September, the budget deficit hit $62 billion, compared to a $125 billion deficit a year earlier and market expectations of a $60 billion gap. 

The smallest budget gap since January 2020, with revenue growing 23.1 percent to $460 billion while expenses only increased 4.7 percent to $521 billion.

Too early to raise US interest rates 

Federal Reserve Chair Jerome Powell said it is early to increase borrowing rates risking slow economic recovery, in spite of a risk that high inflation in the United States could persist. 

"it would be premature to actually tighten policy by raising rates now with the effect and intent of slowing job growth," he said 

Policymakers are forecast to proclaim the slowdown of bond buying at the central bank's policy meeting next month. Still, the benchmark lending rate is forecast to continue at zero to the latest next year at the very least.

SAMA books $1bn net profit 

Saudi Central Bank (SAMA) recorded a net profit of SR3.8 billion ($1 billion ) at the end of the quarter, above the same period last year, by 0.6 billion. More than the average analysts' expectation on Refinitiv Eikon data of SR3.6 billion.

Russia raises interest rate

Russia's central bank increased the key interest rate above what was expected by 75 bps to 7.5 percent, from a forecast of a 50 bps increase, the highest since June 2019. That increased in the rouble and signaled increases as inflation showed little sign of slowing.

Japan’s Inflation up slightly

Japanese inflation rose for the first time in 13 months to 0.2 percent annually in September 2021 from a negative 0.4 percent in August 2021.

Eurozone inflation hit by supply shocks

Significant supply chain problems in factories have caused prices to rise that they did not see in the Eurozone twenty years ago.


US body seeks to explore more ‘green’ opportunities in KSA

US body seeks to explore more ‘green’ opportunities in KSA
Updated 25 October 2021

US body seeks to explore more ‘green’ opportunities in KSA

US body seeks to explore more ‘green’ opportunities in KSA
  • US Green Building Council plans collaboration with Saudi institutions to reduce carbon emissions

JEDDAH: The US Green Building Council plans to support the Saudi Green Initiative in terms of its goals in reduction of carbon emission, global warming, and carbon footprint, and achieving carbon neutrality by 2060. 

The USGBC certifies projects in Saudi Arabia under the LEED operating system (Leadership in Energy and Environmental Design), an internationally recognized certification system that certifies buildings that achieve innovation in sustainability and energy efficiency, water efficiency and better indoor environment quality and better quality of life.

The system also recognizes best-in-class buildings, cities and communities “to reduce carbon emissions through the built environment, which contributes to climate change especially in carbon emissions by almost 40 percent,” Mohammed Al-Surf, regional manager of the USGBC in the Kingdom, told Arab News.

FASTFACTS

• The USGBC certifies projects in Saudi Arabia under the LEED operating system.

• The system also recognizes best-in-class buildings, cities and communities to reduce carbon emissions.

• The council is also looking toward collaborating with different institutions such as financial institutions to establish green bonds.

“Our goal is to collaborate with the SGI through different platforms and different projects like the giga-projects to help minimize their emissions and mitigate climate change,” he added.

He said the council is also looking toward collaborating with different institutions such as financial institutions to establish green bonds and green loans to stimulate the economy as well. “These green projects will have investors investing in these projects to make the environment more sustainable,” he said.

The council’s collaboration with the SGI is on a project scale; individual projects, city projects or community plan phases, as well as in terms of education and awareness and capacity-building, he said.

“We’re going to see reports from different projects on how they have achieved the objectives of the SGI through LEED certification which is the main aim of the collaboration with the USGBC,” he added.

The council has certified over 1,500 projects in the Kingdom, including well-known ones such as King Abdullah University of Science and Technology, Prince Mohammed bin Abdulaziz Airport in Madinah, Princess Noura University campus, King Abdullah Petroleum Studies and Research Center, Ithra museum and the masterplan for the Red Sea Development project.


Saudi Arabia prioritizes tourism sector net zero target

Saudi Arabia prioritizes tourism sector net zero target
Updated 25 October 2021

Saudi Arabia prioritizes tourism sector net zero target

Saudi Arabia prioritizes tourism sector net zero target
  • With the global travel and tourism sector responsible for 8 percent of the global greenhouse gas emissions, Saudi Arabia is giving priority to achieving net-zero emissions in the sector

RIYADH: The Sustainable Tourism Global Center launched by Crown Prince Mohammed bin Salman at the Saudi Green Initiative Forum on Saturday aims to modernize the sector with a focus on preserving nature and fighting climate change.

With the global travel and tourism sector responsible for 8 percent of the global greenhouse gas emissions, Saudi Arabia is giving priority to achieving net-zero emissions in the sector.

Referring to the global emissions at the SGI event, Saudi Tourism Minister Ahmed Al-Khateeb said: “This is expected to grow if we do not act now.”  

“Tourism is also a highly fragmented sector. Eighty percent of the tourism businesses are small and medium-sized enterprises that rely on guidance and support from sector leadership. The sector must be part of the solution,” he said.

Sustainable Tourism Global CenterThe center will support travelers, governments, and the private sector to ensure that tourism enables growth and creates jobs, while playing its part to achieve the climate goals laid out in the Paris Agreement, including contributing to keeping the global temperature rise to under 1.5 degrees Celsius.

The facility aims to be the “north star” for the tourism sector as it recovers from the COVID-19 pandemic and transitions toward a sustainable future.

Globally, tourism supports more than 330 million livelihoods – and pre-pandemic, it was responsible for creating one in four new jobs globally.

Al-Khateeb said: “Saudi Arabia, following the vision of the Crown Prince, is answering this vital call by working with partners to create a multi-country, multi-stakeholder coalition, that will lead, accelerate, and track the tourism industry’s transition to net-zero emissions.”

Details of the center and its functions will be  unveiled at the COP26 in Glasgow.

Gloria Guevara, the chief special adviser to the tourism minister, said: “For years and years, multiple players across the tourism sector have been working on different initiatives to accelerate the race to zero (emissions) — but we have been working in silos. The impact of the global pandemic on the tourism sector highlighted the vital importance of multi-country, multi-stakeholder collaboration. And now, Saudi Arabia is stepping up to bring stakeholders together to make tourism part of the solution to climate change.”


Saudi startup joins in national efforts promote green building

Saudi startup joins in national efforts promote green building
Updated 25 October 2021

Saudi startup joins in national efforts promote green building

Saudi startup joins in national efforts promote green building
  • Large number of people in the Kingdom are moving toward sustainable solutions

LONDON: As global leaders converge at the Middle East Green Initiative Summit on Oct. 25, the focus will be on new ideas and proposals to replace the wasteful and polluting ways in favor of environmentally-friendly methods. 

Meanwhile, there are set to be profound changes at the grass-roots level, in terms of sustainable living environments. A number of “green” startups have emerged in the Kingdom in recent years, offering products and services that aim to reduce carbon emissions while improving the quality of life for ordinary citizens.

One such company is Riyadh-based EIA Energy. Founded in 2020 with support from Monsha’at, the General Authority for Small and Medium Enterprises, EIA Energy is a 12-employee firm with a turnover of SR1.2 million and projected growth up to SR7.5 million by Q4 2022.

“EIA Energy was founded as an energy services company (ESCO) and has developed into a provider of end-to-end energy management services and solutions to reduce energy consumption and increase energy efficiency in client facilities,” CEO Abdullah Al-Othman told Arab News. 

As a certified ESCO, EIA Energy provides three kinds of service: First, energy consulting and energy monitoring in order to reduce costs; second is the obtaining of “green certification” for facility owners and managers; and third is guidance regarding green building techniques in terms of architecture, efficient water use, landscaping and eco-friendly transport solutions. 

EIA Energy describes its energy efficiency strategy as the “SMARRT Approach” – an acronym for Surveying, Monitoring, Analyzing, Reducing, Reviewing and Targeting.  

There will be a growing demand for this kind of consultancy in Saudi Arabia as builders and developers conform to new green regulations while satisfying the demand of modern families for a healthier and better way of life. 

“This is a good time for ESCOs right now,” says Al-Othman, “because we’re catching the beginning of the whole transformation that’s taking place, the cultural shift. There are a lot of government initiatives – Vision 2030, SGI, Green Riyadh — which stimulate the entire market and create a lot of opportunities.”

In the 1960s and 70s Riyadh and other cities in the Kingdom became the so-called “supergrids” of intersecting highways, filled in with buildings and concrete surfacing with only a small allowance for green spaces. Concrete absorbs and radiates heat in the summer months, while preventing ground absorption of rainwater during the winter — causing severe and sometimes fatal flooding. 

“We say no to concrete,” says EIA Energy GM Hamza Khan. “We prefer gravel because there has to be porous ground that allows rainwater to go back into the earth and replenish the groundwater sources.”

Builders, developers and facility operators have no choice but to move from words to action. “We are getting a lot of inquiries from apartment and compound owners, supermarkets, retail outlets and restaurants,” says Khan. “They all want to reduce their costs and their emissions – to offer something more sustainable and to stand apart from the competition.” 

Much of EIA Energy’s efforts are dedicated to enabling LEED (Leadership in Energy and Environmental Design) Certification from the US Green Building Council. This certification promotes a higher quality of life for building occupants in terms of energy and water efficiency and improvement of the living environment. It follows the principle of the triple bottom line of the 3Ps: People, planet and profit. This certification can be applied to any built-up area: residential facilities, office buildings, educational institutions and hospitals.

EIA Energy relies on hardware and software supplied by its UK partner Best Energy. “But it is clear that the technologies we bring to Saudi Arabia should be manufactured or at least assembled here,” says Al-Othman. “And that would solve a major issue that we are facing now with the destruction of the global supply chain due to COVID-19 and other factors.” The company also has ambitions to develop its own proprietary solutions as it grows and expands. 

“Saudi Arabia is going green and is moving towards energy efficiency and reducing its carbon emissions,” says Al-Othman. “Green tech startups and ESCOs have a major part in this. We are benefiting from new government initiatives, and we just want to keep improving and introducing more services — in line with Vision 2030, which says that SMEs should play a key role in the future Saudi economy.”