09/05/12

Dubai commercial property market regains Investor Interest

Investors have started to draw their attention to segments of the United Arab Emirates’ property market, and in particular the Dubai commercial property market as a source of stable returns just 3 years after a price crash, that may speculators anticipated to linger for a far longer period of time.

The National Bank of Abu Dhabi, alongside Kuwait-based Gulf Investment Corp, launched a UAE-focused real estate investment trust this week. A barely tested product in the region, the fund will gauge the appetite of international investors to return to Dubai property.

Whilst the Dubai property market made the headlines throughout the last few years, believed to have been one of the worst hit with the economic downturn, confidence is now growing in the Emirate.

There has been a stream of new buildings, keeping the market over supplied, however healthy returns can be made by targeting top-quality Dubai commercial property.

Despite the stream of new buildings that are keeping the market oversupplied, management of the fund say stable, healthy returns can be made by targeting top-quality commercial property.

Russell Reed, chief investment officer of Gulf Investment Corporation, said at the launch of the Reit on Sunday: “Crashes create opportunities.” The fund will look at Dubai’s commercial and industrial areas, where business remains brisk

Source: Financial Times