AQARI - English - Apr 2013

ISSUE 3 | APRIL 2013
3
‫ﺑـــﺮوة ﺗﻘﺪم ﻣﻘﺘﺮﺣـﺎت ﻟﻤﺸـﺎرﻳﻊ ﺳﻴﺎﺣﻴﺔ‬
‫ﻓﺮﻳﺪة ﻣﻦ ﻧﻮﻋﻬـﺎ ﻟﻬﻴﺌﺔ اﻟﺴـﻴﺎﺣﺔ‬
AQARI
ISSUE 3 | APRIL 2013
BARWA PROPOSES EXCLUSIVE DESIGNS FOR
3
QATAR’S LARGEST TOURISM INVESTMENTS
2013
2013
Eng. Saad Ahmad Al-Muhannadi
Chief Executive Officer of Qatar Rail
Do not miss this opportunity to
succeed.
Designed to make your business thrive, Barw a Commercial
Avenue, Qatar’s new est and largest mixed-use destination
s stretching for 8.5 kilometers.
consists of
• 640 retail stores
• 540 residential units
• 1,000,000 m
• 500,000 m
2
2
built-up area
leasable space
• 12,000 parking spaces
• 8.5 km long
• Easy reach to major destinations in Doha
• State-of-the-art infrastructure and facilities
Leasing A gent
800444 4
B-INSIDE
Designing Barwa City 2 and
completing “Ottomari” 3rd
quarter of 2013
Barwa launches its new
corporate identity
Barwa celebrates National
Sports Day
Barwa participates in Qatar
Career Fair 2013
Barwa launches electronic
system to administer AGM for
shareholding companies
4
5
6
7
7
SHAPING QATAR
Barwa Al-Sadd... a new
concept for office solutions
Hamad International Airport…
a Qatari jewel on the Gulf waters
ONE-ON-ONE
Exclusive interview with
Eng. Saad Ahmad Al Muhannadi
Chief Executive Officer
of Qatar Rail
Barwa proposes exclusive
designs of Qatar’s largest
tourism investments
8
AROUND
THE
WORLD
30
EYE ON THE
MARKET
Real estate in Q4: flash
assessment
Recovery of Dubai
real estate market
Sports day … a National
advocacy for an active healthy
community
26
Barwa gears up for FIFA
World Cup 2022
28
Retail market revives
the real estate sector
Real estate price index
Qatar Central Bank
18
20
22
13
15
17
HERE & THERE
THE INBOXER 32
Doing business in Qatar
HAYAKOM
Dear Readers
With the revolutionary urban development and the large investments in infrastructure and construction in Qatar, the human element remains to be most valued among all, and all
development plans must aim to serve and improve living standards of individuals in our community. For this reason, many
initiatives have been adopted by the State of Qatar, such as
the Emiri Decree No. (80) in 2011, issued by H.H. Sheikh Tamim bin Hamad Al-Thani, Heir Apparent, to mark Tuesday in
the second week of February each year as Qatar’s National
Sports Day.
Sports Day aims to spread awareness on the importance of
sports in the lives of individuals and communities alike. This
year, The National Sports Day has seen great participation
from all members of the Qatari community. Citizens and residents from all ages enjoyed a variety of sports activities, as
organizations from both the government and private sectors
raced to cater for this national celebration in all parts of the
country.
The Emiri decision to celebrate the National Sports Day is a
confirmation of the importance of fitness in our daily lives.
Sports have long been associated with health and wellbeing, and not solely as a leisurely pursuit. Accordingly, Qatar
is stepping forward with its achievements, further enhancing
the values of Qatar’s National Vision 2030, which is based on
investing in the human capital to build a generation capable of
creating a brighter future for tomorrow.
Finally, we would like to send tribute to H.H. the Emir of the
State of Qatar and the Qatari Government for their efforts
aimed towards ongoing communal growth and development,
wishing further prosperity for our beloved Qatar… Hayakom
Ahmed Abdullah Al Abdullah
Deputy Group CEO - Barwa Real Estate
Team
Editor in Chief:
Hamad Rashid Al Kuwari
Editorial Team:
Mohamad Baadarani
Neveen Aljajeh
Rana Al Wehaibi
Khalid Almoathen
Mahmoud Saeed
Writers:
Dr. Tarek Coury
Mohammed Siddique
Sameer Sheikh
Chris Santiago
A periodical real estate
magazine published by:
Tel: +974 4408 8888
Fax: +974 4499 8994
www.barwa.com.qa
In collaboration with:
B-INSIDE
2013… a year of success for Barwa
Designing Barwa City 2 and completing “Ottomare”
3rd quarter of 2013
Barwa’s achievements in 2012 emphasize its position as one of
the fast growing economies in the world. The initiative of economy diversification had proven a good return on the real estate
and infrastructure sectors. Barwa Real Estate Group contributed
greatly to the construction and developmental leap in Qatar by
putting its strategic directions and ambitious aspirations into action, thus achieving its vision to be a reliable real estate company
recognized for its strong values, excellence and sustainable returns to its stakeholders.
Since its inception, Barwa strived for growth and excellent performance at every level; it took serious steps in launching a number of projects around Qatar. The group signed leasing agreements with prominent institutions in Barwa Commercial Avenue
which is approaching completion, to achieve 60% occupancy of
available spaces, which will soon be ready to start operations.
The group also launched Barwa City, a widespread residential
project offering high-quality facilities and lifestyle. Comprising
of 6,000 residential units, commercial outlets and schools, the
completed development started welcoming its tenants as the occupancy rates reached 50%, and expected to reach 75% by end
of the year. Commercial outlets and recreational facilities, on the
other hand, achieved 100% occupancy and undergoing preparations for opening. Qatar Petroleum District, one of Barwa’s mega
projects in West Bay, is going on schedule, with an expected delivery date on Q4 2015. The project which was bought by Qatar
4
Petroleum consists of distinct office spaces, a five-star hotel in
addition to a number of commercial outlets.
As for investment deals, Katara Hospitality signed an agreement
with Barwa Real Estate Group to buy Barwa Al Sadd hotel and its
recreational center, along with the Somerset West Bay Serviced
Residencies. Alaqaria, one of Barwa’s subsidiaries, continues to
utilize steady efforts on housing and recreational facilities inside
the industrial area, collectively raising its portfolio of undergoing
construction to QR 980 million, in addition to projects worth QR
1.67 billion under initial design and negotiations. In 2012, Alaqaria finalized a 50% purchase of ASAS Real Estate Company, held
by another group to make it a 100% subsidiary of Alaqaria.
Barwa Real Estate Group is currently studying potential investment opportunities in London/UK, Turkey, Germany, the GCC,
USA and Southeast Asia. The Ottomare project in Turkey is a
unique international investment, comprising 391 upscale residential units. Sales closed at 90% of units; the remaining units
are expected to be sold out soon. The development is scheduled
for completion during the 3rd quarter of 2013. Refurbishment
works are in progress in the London based North Row development offering office spaces in the West End of London. Works
are expected to be completed by 3rd quarter of this year and occupancy of more than 90% is expected to be achieved by 2014.
Similarly Barwa supplies many real estate opportunities to be
evaluated for the best use of the company’s assets in order to
maximize the return for shareholders. Work has commenced on
the master plan and feasibility study for Fox Hills (Lusail) which is
due to become an exciting new growth centre of Doha. Likewise,
Barwa City 2 is planned to be an attractive midmarket community and is looking to build on the success achieved at
Barwa City. Barwa City 2 is in the early
stages of feasibility analysis and concept
design.
Master planning and feasibility analysis
stage has started for Lusail Golf District, which will be a premium residential
community built around golf course with
world class facilities including a luxury
hotel and retail. A construction contract
was awarded for “Barwa Al Baraha”
Phase 2, late in 2012. Located in the industrial area, the project
is expected to develop into a city that will accommodate 53,000
residents. Construction works also started for 50 Villas and 300
Apartments with modern facilities for Qatar Shell in Al Khor.
Baraya development is also progressing. The development is a
mixed-use development offering serviced apartments for middle
class families as well as commercial outlets which are expected
to become an attraction for popular retail brands.
The inspiration behind Barwa’s serious efforts to develop strong
infrastructure for integrated communities is the true aspiration
to create a decent lifestyle for all segments of the Qatari community. Barwa rises above the regular set of architectural plans
to allow boundless inspirations for a more innovative way of life.
Barwa launches its new corporate identity
Barwa’s growing success in Qatar and the region, called for
launching a new corporate identity with a focus on reviving Qatar’s heritage rich in values. This step comes from the profound
appreciation of the deep-rooted legacy of the nation, its history
- both present and future. The communication Department at
Barwa went through an extensive image revamp process for
the brand mark using three-dimensional techniques to highlight
its distinguished elegance.
Barwa’s new brand mark connects with its individual identity
which is derived from the Qatari heritage - a heritage based
on values of trust and credibility. The logo elements emphasizes the values inspired from the surrounding environment; the
main color blue highlights the purity of Barwa’s values and vision, while the slogan “building the future” expresses the young
state’s aspirations to take a role in wide-reaching investments
beyond geography’s visible worlds. The business nature of Barwa Real Estate Group is summarized in its real estate investments and financial services, in addition to public investments.
The group has identified its core values as entrepreneurship,
commitment, reliability, teamwork and integrity.
With its new identity, Barwa commits to the core values ​​that reflect its vision throughout every act of the brand, aligning brand
attributes with core values at all times. Barwa aims to redefine
and consistently improve the customer’s experience, maintain-
ing the essence of core values. The group’s name originates
from an important principle in Qatar’s commercial heritage the concept of a reliable and trustworthy agreement or contract
with values forming the core of Barwa’s corporate personality.
The logo was inspired by the concept of sustainability, expressed by interconnecting sand and water waves under the
shining sun; this image symbolizes the Qatari sophistication in
the modern real estate projects, while large in scale and magnitude, stay true to the vision of a futuristic Qatar 2030. Water
and land mix seamlessly with smooth and engineered precision
to create modern, lasting landscapes.
Barwa’s new corporate identity expresses main attributes like
insight, differentiation, innovation, uniqueness, consistency and
boldness. These attributes demonstrate how Barwa’s promise
to its customers to deliver above and beyond expectations in
every aspect of the brand, can and should be linked with promising growth and prosperity for the BARWA Real Estate Group.
5
Health clubs and sports fields are vital elements of all Barwa’s
residential projects
Barwa celebrates National Sports Day
Barwa Real Estate Group has once again been enjoying Qatar’s
national celebrations as a chance for management and staff to
congregate and socialise. Qatar’s National Sports Day is an opportunity for employees and families to engage in stimulating
activities which promote wellbeing and fitness.
This year saw a turnout of over 1400 Barwa employees along
with its subsidiaries and staff of Qatar Rail. The event was held
at the Diplomatic Club which held host to the day of sports competitions, fitness exercises and games for employees, friends
and family.
“The initiation of the National Sports Day is a wonderful step
from H.H. Sheikh Tamim Bin Hamad Al Thani, as it reflects the
State’s interest in promoting public health in the community”,
Mr. Abdulla Bin Abdul-Aziz Turki Al Subaie, CEO of Barwa Real
Estate Group.
Whilst recalling his participation in the National Squash team, Al
Subaie also mentioned that the sports promoted on Sport’s Day
benefited employee’s productivity by stimulating greater energy
and endurance levels in staff.
Al Subaie stressed on Barwa’s world-class experience and capabilities which qualify the group to organise and execute large
scale sports projects. This was the main trigger behind Barwa’s
recent agreement with the Olympic Committee.
The National Sports Day gave employees and their families
a multitude of fun sports competitions, fitness exercises and
games to encourage participation. The initiative also promoted
regular exercise, explaining the long term benefits in productiv6
ity and longevity.
Barwa Real Estate Group took part in the first National Day celebration last year, along with the Supreme Council of Health,
through organising a marathon on Doha Corniche. The starting signal was announced by H.E. Mr. Abdulla Bin Khalid AlQahtani, the Minister of Public Health and Secretary General
of the Supreme Council of Health, an event highly rated by the
Qatari Community.
Staying true to the pillars of Qatar National Vision 2030, Barwa’s
celebration of National Sports Day aims to improve the quality
of life for families and members of society by developing physically, psychologically and socially strong future generations.
Barwa’s interest in sports extends to integrating sports facilities
within all of its projects, in order to provide lasting access to the
benefits of staying fit, performance and wellbeing.
In its first residential projects in Masaken Mesaimeer and Al
Sailiya, Barwa established a host of sports facilities including
football and basketball pitches and courts for the residents. Barwa Village is equipped with a fully integrated Health Club along
with special cycling tracks to encourage all-round vitality and
wellbeing.
By promoting a culture of active lifestyles and self-improvement,
Barwa has set itself apart from other groups. Barwa strives to
provide its iconic Barwa City project access to a sports facilities, parks, playgrounds, walking and cycling tracks, a gym and
a fitness club which all help to support a new age of physical
education, health lifestyles and wellbeing amongst all residents.
Barwa participates in Qatar Career Fair 2013
54% Qatarization rate and scholarships for 87 students
Since its inception, Barwa Real Estate Group has been keen to
attract young Qatari talents. This comes as part of its commitment towards human development and its pursuit to further
the group’s strategy. The Qatarization levels in the group have
reached more than 54% of the total headcount, proving its support to Qatar National Vision 2030 and prioritizing the best interest of the Qatari community in all aspects of Barwa’s business
operations.
With its grand vision, Barwa is strongly committed to its human
development policy to form a competent team able to imple-
ment the group’s strategic plan. Barwa
works hard on creating the right work environment to develop highly qualified national
caliber in line with the strategic Qatarization
plan to utilize national talent especially in senior management positions.
To be an effective contributor to recruitment
plans, Barwa formed an agreement with the
Ministry of Labor to train Qatari youth and
develop their skills to adapt to the market
requirements in Qatar. Recently the group
announced its scholarship program sponsoring 87 Qatari students to continue their education abroad in different fields in the UK,
USA, other universities in Europe and the Arab region. Along
with Barwa’s annual participation in Qatar Career Fair 2013,
which took place on April 1st, the group seized the chance to
engage with Qatari youth and reveal potential job opportunities.
Nurturing and supporting national talents through training and
professional development is of utmost priority to Barwa Real
Estate Group, as it considers this socio-economic development
to be pivotal in tapping into Qatar’s true natural resources in
Qatari youth, the leaders of tomorrow.
Barwa launches electronic system to administer
Annual General Meetings for shareholding companies
For the first time in the region, Barwa Real Estate Group
brings in the latest technology to administer Annual General
Meetings for shareholding companies, which the group used
to facilitate its Ordinary Annual General
Meeting, held on Tuesday 2nd April in Al
Sonbok Hall, Sharq Hotel – Doha, with a
complete quorum of 62.81%.
H.E. Sheikha Jassem Bin Abdulaziz Al
Thani, Minister of Business & Trade, in collaboration with Barwa Real Estate Group,
launched the electronic system earlier in
March 2013. The system is provided with
a smart chip inserted into a device that includes information of the shareholder and
the number of shares he holds, to allow
him to view the meeting agenda, vote on
different aspects and facilitate their participation in Q&A sessions.
Barwa Real Estate dedicated efforts into
bringing this latest technology to Qatar after converting the
system into Arabic to facilitate shareholders meetings and
conform to regulations set by the State of Qatar.
7
ONE
on
ONE
Eng. Saad Ahmad Al-Muhannadi
Chief Executive Officer of Qatar Rail
8
US$40 billion total cost of the
Qatar Rail
Phase 1: Lusail Light-Rail tunneling is 100% complete
commission date scheduled for Q4 2016
Qatar Rail is implementing a first class project on a national
scale; it is executing a highly advanced countrywide integrated
Metro and Railway network, linking Qatar to Bahrain and Saudi
Arabia, and on later stages the rest of the GCC.
In an exclusive interview for AQARI, Eng. Saad Ahmed
Al-Muhannadi - QRail CEO announced the total cost of the
project reaching $ 40 billion, currently implementing phase 1
of three, executing Lusail light-Rail. This phase is expected to
launch end of 2016, it is composed of a network of 28 km length
and 36 stations to serve Lusail City, and is connected with the
Metro Network. Additionally, Al-Muhannadi stated that the
project tunnelling is 100% complete.
Firstly, we would like to know more about the CEO of Qatar
Rail and his vision to build and develop a large company like
Qatar Rail that is considered to be one of the pillars of the
2030 Qatar National Vision?
Qatar Rail’s vision is ambitious; it envisions the Metro and
Railway networks as the favored mode of transport for all.
Our missions and values are enshrined to this vision, using a
clear set of goals and objectives we can accomplish this vision.
At QRail we are not only involved in developing a ‘Metro and
Rail’ network, we are building a state-of-the-art national infrastructure that will impact our country’s image in the future.
Our compass guides us towards growth consistently, stressing
on the vision to ensure it is the predominant driving force in
all that we do.
Our aim is to introduce a new transport model, a technologically advanced network fully integrated within our existing
transport network. This will lead to a better environment,
greater quality of life, more business opportunities and a
skilled workforce throughout Qatar.
jor cities in the surrounding area. This network consists
of four major lines: red, gold, green, and blue. The design
phase is complete, as has the Enabling Works. The urgent
tenders for tunnel digging and ground stations were offered. The construction phase is scheduled to begin later
this year 2013. We are currently preparing to offer the
tenders of over ground and ground lanes, and also offer
tenders for train carriages and systems. It is expected to
be offered in the second quarter of 2013.
•
Long Distance Project for passengers and cargo: 490
km in length, 9 passenger stations and 6 cargo stations
What are the principal phases of Qatar Rail Project, and what
is the total cost?
The total cost of Qatar Rail Project is estimated at $ 40 billion,
primarily implemented in 3 phases:
•
Lusail Light-Rail
It is composed of a network of 28 km length and 36 stations which serve Lusail City, connected with the Metro
Network. The project is in construction phase and the tunnelling is 100% complete. Commission date is scheduled
for Q4 2016.
•
Doha Metro Project
It consists of a Metro Network of 212 km in length and 89
stations which serve Doha City and connect it with ma9
ONE on ONE
which are connected with exterior cities and are linked
with GCC railway. The tenders have been floated for the
design phase and the construction phase is scheduled to
begin Q1 2015. All this work is to be completed within the
proposed time-frame.
You previously mentioned that although this is a rail project, it
is a national development project for the state, requiring many
laws, legislations and new ways of working. Is there coordination between various organizations and what is the relative
amount of cooperation especially that each sector has different priorities?
All involved parties commit greatly to support the implementation of the rail project, both nationally and internationally.
Lately the legislation of tunnel digging was issued, and the Rail
Law which includes a list of legislation and regulations of the
Qatar railway sector was released to the General Secretary
of Cabinet, it is currently being studied. It is one of the largest
projects in Qatar with an executive and coordinating committee consisting of members representing all concerned sectors
within Qatar.
The rail project will generate a new industry and increase business opportunities for local markets. What are these industries
and opportunities?
Qatar Rail has demonstrated an ideal model by delivering information about the different opportunities with the Metro and
Railway project. There was coordination with Qatar Development Bank and one of the expertise houses to study these
opportunities - there are over 104 identified investment opportunities available to private sector. These vary from construction, operation, maintenance and manufacturing to training and retail, all of which will directly and indirectly support
the Qatar Rail supply chain. There are also clear guidelines
from His Excellency, the Prime Minister and the President of
10
the project steering committee to provide all information about
the project to the Qatari private sector. Qatar Rail encourages
the Qatari private sector to partner with international companies, as local companies have the required expertise via existing regulations and local projects and logistics, however, the
international companies also have expertise in establishing
railways, thus integration between both experiences can be
achieved, offering the executing companies more abilities and
power. We determined terms for the big tenders, stating that
it is crucial to have a partnership between the foreign and local
real estate companies. We have succeeded in this task; most
qualified companies now have Qatari partners.
Qatar rail offers the same features known in the country related to the partnerships of private sector in projects. What is
exceptional about QRail is that we have prepared studies and
information for the private sector, allowing them to voice their
opinion on investment opportunities whilst participating in this
vital project.
How do you see the cooperation between Qatar Rail and the
real estate sector generally?
Any development project in Qatar has ramifications on all economic sectors, e.g. financial, service, and real estate. There
will be a special relationship between the real estate sector
and Qatar Rail because construction and property development play a large role in our plans, e.g. train stations, supporting facilities, infrastructure works, and so forth. Therefore,
our projects will have an important and
positive impact on the real estate sector.
There is a close and direct relation between the Metro network and real estate
development. According to studies, Metro
stations lead to direct increases to land
value within the immediate area of the
station.
Are there conditions for choosing foreign
companies to work on the project, as some
international firms have been strongly affected by the economic crisis?
Currently conditions are in place when it
comes to qualifying international companies, taking into consideration their performance in previous projects and their financial status. Some international companies
have already established Joint ventures
to be able to fulfill contracts, this provides
Qatar Rail with a greater variety of choices to ensure better
selection.
What role will security play in a project as large as this?
Security is a critical aspect of the Qatar Rail network. We will
not only have security measures in place from an operational
perspective, such as security patrols and the use of CCTV with
certain technologies, but we will also incorporate security el-
ements into the design of the system to maximize security.
We are in the process of preparing the necessary procedures
related to possible security incidence to ensure the most effective and efficient response to any given situation.
Qatar Rail, security and safety come at the front of our priorities, and we will strive to deliver exemplary, secure facilities. Our security will meet the latest international standards
for railway security, whilst applying the best global practices.
Regarding safety, we signed a contract with Lloyds Register
in August 2012, to act as our Independent Safety Assessor
(ISA), ensuring all aspects of the rail program meet international safety standards.
What about the relationship between security and the environment on the rail project?
Our goal is to make the Qatar Rail networks not only secure,
but also environmentally friendly. Security measures under
normal operations will not be overtly obvious or burdensome
to the passenger. All security measures will be environmentally sound. At times, the environmental elements can be used
as part of the overall design approach, to create seamless interaction with passengers.
To what extent is the project related to the time table of World
Cup 2022?
The rail network we are bringing to Qatar is not solely for the
World Cup. Qatar as a nation had already identified the desire
to have a world-class rail infrastructure network which would
directly support the Qatar National Vision 2030 – this is what
drives us at Qatar Rail. We will work closely with Qatar 2022,
and host all other major events, to ensure any specific requirements that may need to be addressed.
The great deal of infrastructure projects underway throughout
Qatar all have very tight deadlines to meet. Qatar Rail works
collaboratively with each of them to ensure we all achieve our
goals which have been set out within the National Vision.
What about the Qatari Youth and their involvement in Qatar
Rail, are there plans to help develop and evolve your employees with technical and administrative skills?
Qatar Rail is committed to developing and investing in its
people in all of its business fields; from technical fields relating to the rail and construction industries, to the supporting
functions necessary to deliver such a challenging program, i.e.
procurement, commercial, legal, IT, HR, finance, communications, etc….
Moreover Qatar Rail is fully dedicated to the Government’s
Qatarization initiative. Qatar Rail has employment, training
and development strategies in place to recruit and develop
Qatari Nationals. We also aim to attract and support fresh Qatari graduates to build the Company’s future workforce.
Starting this year, Qatar Rail will sponsor Qatari students
through a scholarship program where they will gain knowledge and qualifications at the ‘best in class’ educational institutions within Qatar which will be of added value to the effectiveness of Qatar Rail. To enable us to achieve this objective,
Qatar Rail will:
• Identify talented Qatari students and sponsor their studies
at reputable academic institutions.
• Support sponsored students through their academic studies to ensure their success.
• Provide rich and challenging career opportunities to program graduates that will see the development of future
Qatari leaders and experts in the Rail industry.
Qatar Rail is also offering internship opportunities in various
business fields and already supports Qatari students in implementing their projects during the last year of their Engineering
studies.
11
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EYE On The MARKET
As the Qatari economy continues to grow, so does its complexity. EYE ON THE MARKET provides concise and up-todate market intelligence on the real-estate sector in Qatar, along with an economic overview of recent developments
in Qatar. EYE ON THE MARKET also provides a segment-specific focus on market opportunities in Qatar, with a look
this quarter at the retail sector in Qatar.
Real estate in Q4 2012: flash assessment
2012 witnessed a near doubling of transactions in the real- per square feet in Q4 2012 from QAR 143 per square feet in
estate sector worth QAR 41.35 billion relative to QAR 22.21 Q1 2012. Outside of Doha, land prices range from QAR 109
billion in 2011.
per square feet to QAR 342 per square feet.
Transaction value was however frontloaded in 2012 with The residential sector remains resilient in 2012 when comtransactions in Q4 2012, worth around QAR 8.8 billion, 52% pared to 2011.
lower than in Q1 2012. Real estate transactions
Residential performance metrics, such as occupancy
witnessed the most activity in the municipality
rates have gone up from 80% in 2010 to 90% in
of Doha in Q4 2012 and throughout 2012.
2012 despite a massive increase in residential
High
Doha, Al Wakrah and Al Rayyan municipalities
supply of 18,000 units in 2012. In comparison,
occupancy rates
recorded the highest number of transactions in
only 3,000 units of additional stock came onfor hospitality
Q4 2012.
line in 2011. The increase in occupancy rates
sector in Q4
Vacant land transactions accounted for roughly
implies that the population growth Qatar expehalf of all transactions in both 2011 and 2012.
rienced in the past few years of about 4% per
Despite having the highest land prices among all
annum is sufficient to push up occupancy even as
municipalities, the municipality of Doha witnessed an insupply increased. This bodes well for 2013 with populacrease in price of over 39% to QAR 911 per square feet in Q4 tion growth expected to average 4% and supply expected to
2012 from QAR 655 per square feet in Q1 2012. Al Dayeen increase by only 10,000 units. Given that government spendwitnessed the largest price increase of over 43% to QAR 205 ing on infrastructure projects in the coming decade is front13
EYE on the MARKET
loaded in the next couple of years, additional demand is likely
to come from low to middle income earners, a category of
workers that signals the importance of additional provision
for affordable housing.
Rents in the office sector have witnessed an uptick from Q1
2012 to Q4 2012, with rents reaching QAR 158 per square
14
meter in Q4.
This is primarily due to an increase in supply of high-end stock
that came to the market in Q1 2012. With a slowing economy
now driven by the non-hydrocarbon sector, downside risks
on occupancy rates by the private sector in the central business district remain high, while risks may be less pronounced
in secondary and tertiary business districts as these areas
are more likely to experience an increase in business activity
linked to government-driven infrastructure spending.
Performance in the retail sector continues to be positive with
near 100% occupancy in malls, with rentals in shopping malls
averaging QAR 200-250 per square meter, a 30% premium
over strip retail. Asking rents in some upcoming malls are
30% higher than prevailing rents for shopping malls. Gross
leasable area per capita will remain low by regional standards
despite a massive increase in supply, owing to robust population growth in the coming years.
The hospitality sector has finished 2012 on a high note with
occupancy reaching a peak of 64% in Q4 2012, up from 45%
in Q3 and 56% in Q2. Annual averages for occupancy rates
and other performance metrics such as revenue per available
room (RevPar) and average daily rates (ADRs) are within regional benchmarks, with Riyadh, Dubai and Muscat recording
the highest annual ADRs in 2012.
Jeddah recorded the highest average occupancy rate in the
region in 2012 while Dubai recorded the highest RevPar in
the region.
tival City for example was launched during the first quarter
of 2013.
The retail market still benefits from a high disposable income A majority of the current and upcoming malls in Qatar cater
client base and a fast growing population which allows it to to the mid to high income segment, owing to the fact that
remain one of the strongest performing asset classes in Qa- Qatar has one of the highest GDP’s in the world. While this
tar’s real estate landscape. High-end retail in Doha is domi- is also the case in the Dubai retail sector, a regional benchnated by approximately 588,000 m² of gross leasable area mark, the composition of retail demand between Dubai and
(GLA) spread across eleven major shopping malls, bringing Doha is radically different, with Dubai capturing a lion’s share
GLA per capita at around 0.3 m², below regional benchmarks. of regional tourism spend while Qatar’s incoming workforce
Mall occupants are predominantly local conglomerates op- suggests a potential market gap for low to mid end strip reerating in the retail space that have acquired
tail. Dubai also benefits from a wealth of Family Enterthe right to market international brands on a
tainment Centers located within its flagship malls,
Performance
franchise basis. The prominence of local conanother potentially critical factor for success in
in the retail
glomerates in the retail sector is due to local
upcoming malls in Doha where they currently
sector continues
ownership laws that compel foreign brands to
remain lacking.
to be positive with
near 100 percent
engage in a joint venture with a local partner to
Major strip retail is found on Salwa Road, Al
occupancy
in
operate in Qatar.
Saad, Bin Mahmoud, Airport Road, the A & B
malls
Relative to other regional markets, Qatar malls
Ring Roads, the Musherieb Area, Al Wakrah and
currently have a limited number of international
Al Khor area which all have near 100% occupancy
brands that cater to the mid- and high-end income segments. rates. The tenant profile typically includes furniture and
While the Doha retail sector is set to mature, brand penetra- lighting outlets, new and used car showrooms, local clothtion remains low by regional benchmarks. By 2015 however ing and apparel stores, and local and international F&B outQatar is set to acquire an additional 1.1million m² of retail lets. Existing rental rates are generally 30% to 40% lower
space spread across 14 malls, this will likely ensure more than asking rates in malls with monthly rental rates ranginternational brands entering the market. Ikea at Doha Fes- ing from QAR120 - QAR220 per m². New supply however
Retail market revives the real estate sector
15
EYE on the MARKET
commands asking rents 25% higher than average strip retail ment in Doha’s periphery. The planned rail network linking Al
rents. Major upcoming strip retail over the next 5 years is in Khor and Al Wakrah to Doha will make these areas readily
the mid to high end. Barwa Commercial Avenue along with accessible to Doha’s residents. Population in the Al Wakrah
other smaller retail complexes in Doha caters to all income municipality is growing with a number of residential units besegments, while the high-end segment is supplied by The ing developed by Ezdan that will translate into retail demand.
Pearl and Lusail. The Pearl Qatar currently has
Al Khor has traditionally been the retail hub for the northern
a total of 190,000m² of strip retail of which appart of Qatar and caters to people working predomiproximately 90,000m² has come online with the
nantly from Ras Laffan. Retail centers in these arUpcoming
remainder due to come online by 2014. In the
eas are 100% occupied and developments under
infrastructure
long term, Lusail city has approximately 1 milconstruction have already been pre-leased indipoint to new
lion m² of retail space planned to be delivered
cating strong pent-up demand for retail outlets.
retail opportuniby 2020.
The Qatar National Development Framework
ties
Upcoming infrastructure projects signal growth
highlights potential retail opportunities in municiin population with a disposable income profile on the
palities like Al Khor, New Al Wakrah and Umm Slal.
low to medium end. This in turn points to new opportunities In addition, the Master Plan 2030 has identified 25 District
for strip retail re-development, Al Sadd, the A-ring and B- Centres within the Metropolitan Area and 18 District Centres
ring roads are already witnessing urban regeneration, with outside the Metropolitan Area for Mixed Use developments
older buildings being demolished and sites prepared for re- on a priority basis.
development. This implies a potential increase in rentals for With new infrastructure being developed in Doha and a
strip retail units.
growing population, opportunities in the retail space point to
New infrastructure points to major scope for retail develop- prolonged growth in the coming decade.
16
Real estate price index
by Qatar Central Bank
For the first time in the State of Qatar, QCB generated a Real
Estate Price Index based on the data issued by the Ministry of
Justice (MoJ) .
Using data from the Ministry of Justice, the Qatar Central Bank
has recently released a Real Estate Price Index. The Index measures changes in transacted property prices including land, villa
and residential sales. Data released monthly by the Ministry of
Justice cover the municipalities of Doha Al Rayyan, Umm Salal,
Al Wakrah, Al Khor, Al A Dayeen, and Al Shamal. The chart
below, taken from the QCB website, displays historical changes
in the Index, with the year 2009-2010 (April-March) chosen as
a base year. Percentages show changes relative to the base period. For example, 137.01% in June 2011 represents an increase
in the value of the Index of 37.01% over the base period while
94.72% in June 2009 shows that real-estate prices, as measured
by the Index, were 5.28% below the value of the Index in the
base period.
According to the QCB, the purpose of the index is to provide
banks with a “reliable measure of real estate prices for valuing
and assessing their real estate credit portfolios” because “domestic banks have significant exposure to the real estate sector” .
According to the QCB, growth in prices in the real estate sector was driven by rapid population growth as well as a growing
economy but the global recession has had an impact on the real
estate sector.
The QCB Real Estate Index shows that after prices rose by 140%
between 2007 and 2008, the financial crisis precipitated a market correction that resulted in the Index falling by over 50%.
A recent IMF report argues that the real estate bubble was in
part driven by “excess liquidity [which] provided easy access to
finance”. The report further argues that the development of a
government bond market, along with other policy changes, will
likely contribute to absorbing this excess liquidity and will result
in more realistic valuations in the real estate sector.
From trough to peak, prices in the real estate sector, as measured by the Index, have rebounded by over 57% since the market correction. The QCB attributes this recovery to the successful World Cup bid and “the ensuing wave of positive sentiments”.
According to the QCB, this recovery was most recently driven
by a rebound in land transactions and prices. Recent data from
the Ministry of Justice confirms this trend, with transacted land
prices per sqft increasing by about 40% for the municipalities
of Doha and Al Dayeen from Q1 to Q4 2012. All other municipalities have also experienced double-digit growth in transacted
prices over the same period.
17
SHAPING QATAR
Barwa Al-Sadd... a new
concept for office solutions
Four towers and three residential buildings are added to Al-Sadd district
In a prime location sits Barwa Al Sadd, a business development located at the heart of Doha, along Suhaim Bin Hamad
Street. The hectic commercial neighborhood is experiencing
a shortfall in office spaces, for that reason, Barwa Al Sadd
was created to contribute to the real estate market of commercial and office units in the area.
Barwa Real Estate Group announced the completion of Barwa Al Sadd in a short period, offering high-end office and
commercial solutions in Doha, with a total cost of approximately QR 2.4 billion.
Barwa has currently leased all office towers on the project.
The first tower is functioning as the headquarters of Barwa
Real Estate Group and its subsidiaries, while second and
third towers have been leased to governmental institutions.
The fourth tower, which is a luxury five-star hotel, was previously bought by Katara Hospitality as per an agreement
with Barwa Real Estate in May 2012. Barwa Al Sadd ho18
tel is expected to be ready for handover during the second
quarter of 2013.
Commenting on the announcement, Mr. Abdulla bin Abdulaziz Turki Al Subaie, CEO of Barwa Real Estate Group said:
“The completion of the Barwa Al Sadd project marks an important milestone, which reflects Barwa’s dedication to the
project’s planning, development, design and construction
over the years.”
This relatively small project is considered pure genius, covering 27,654 square meters; Barwa Al Sadd adds great
value to the construction boom in Doha. The project enjoys
world-class design, and offers a variety of high-end services and business solutions under one roof. The project consists of a commercial and residential complex in addition to
office spaces; it also provides a 3-floor basement to serve
as parking for 1,702 cars.
Centered among the towers is a four–floor retail center and
office units. On the residential front, the project includes
three apartment buildings, each measuring 10 floors and
containing 261 luxury flats of 2 and 3 bedrooms. The project
also provides a nursery to cater for residents and guests
alike.
In addition to the business and residential towers, Barwa
Al Sadd, has a health club which will be operated by Katara
Hospitality. The facility provides spa and recreational services, such as a swimming pool, gym halls, a library, billiards, squash courts and two multi-use lounges.
As for the security feature, a highly sophisticated security
system will be incorporated; each building is to be equipped
with surveillance cameras in addition to manned security
services.
It is expected with the launch of shops and restaurants at
the commercial complex of Barwa Al Sadd that the project will stand out prominently as a commercial, tourism and
residential destination whilst supporting the diversity of the
national economy and Qatar’s ambitious growth.
19
SHAPING QATAR
Accommodates 50 million passengers annually and caters for
jumbo aircrafts
Hamad International Airport…
A Qatari jewel on the Gulf waters
Most countries build airports to serve travelers, but few build
airports to stand as a world class architectural masterpiece.
Qatar stands at the forefront of the scene with its leadership
future insight and great confidence in its people’s potential
to realize its ambitious visions for developing awe-inspiring
projects and offer luxurious services to all its residents.
The New Hamad International Airport is a pivotal development paving way to the realization of the Qatar National Vision 2030. Not only perceived as a giant project, it is indeed a
cornerstone of the steady growth witnessed by Qatar, a selfchallenging country propelling further on the international
stage in record time.
The new airport is a unique architectural masterpiece, importantly positioning Qatar as a leading international aviation
hub. Hosting an operations base for the national airline, Qatar
Airways, and other airlines, in addition to a shipping & aircraft
maintenance center, it is among few in the world to have capacity for unlimited commercial flights, including A380 Super
Jumbos that are joining Qatar Airways’ fleet. The airport is
expected to handle 50 million passengers yearly upon full op20
eration.
Stretched across 28 square kilometers, the airport has one of
the longest runways in the world, an iconic air traffic control
tower, a huge travelers’ lounge and more than 25 thousand
square meters of retail facilities, restaurants and cafes, and a
special public mosque.
In regards to launching the new Hamad International Airport,
the steering committee chaired by Mr. Abdul Aziz Mohammed Al Nuaimi, unveiled the most recent proceedings during
the conference that took place on February 17th 2013, in the
presence of a number of senior government officials, members of the Shura Council, among other business and Media
leaders. The new mega airport is designed to rank among one
of the best in the world, equipped with the most modern technologies to meet rapidly evolving aviation needs, thus fulfilling the ambitious vision of H.H. the Emir of the State of Qatar.
Hamad International Airport marks a new era in Qatar’s aviation industry. It is a world class facility intended to redefine
the passenger and transit experience, and home Qatar’s official airline, Qatar Airways.
In this regard, Mr. Abdul Aziz Mohammed Al Nuaimi announced that 100 international and local companies have
implemented Hamad International Airport, the share of national firms came close to 50%, indicating that the number of
workers approached 50 thousand. Al Nuaimi added that the
new airport will cater for ten low-fare airlines during 2013,
followed by Qatar Airways on a later stage. While the shipping and cargo operations will be moved to the new facility
before flights operations start. Passengers will be able to experience travelling through the world’s newest aviation hub.
An important feature of the new airport is its location overlooking the seashore. A perfect setting for its elegant architectural elements, designed according to the latest global
engineering developments in the aviation industry. The state
of the art development stands out by bringing innovative designs, artistic flavor and essence together with safety, thus
creating an exceptional experience for travelers beyond
comparison
Hamad International Airport is designed to meet a wide
range of needs for passengers from diverse backgrounds. Its
luxurious ambience is enhanced by resort quality facilities,
including plush hotels, spas, swimming pools and leisure options like a squash court to allow passengers to relax, refresh
and rejuvenate in between flights.
Additionally, the new airport will offer an Exceptional experience only few public places around the world offer, where
people can enjoy a museum experience of hand-picked ancient and contemporary art, displayed in a brilliant architectural setting.
The development uses latest technologically advanced systems, including eco-friendly systems in the passenger loung-
es, advanced automated baggage handling system, air traffic
control systems in-line with safety and security systems able
to detect safety faults and identify aircrafts and vehicles on
the runways. The Cargo and Shipping zone, aircraft maintenance center and spare parts storage will all be equipped
with the latest automation technologies in order to operate
autonomously.
The new airport has 41 gates for passengers of wide-body
aircrafts. It comprises of 40 thousand square meters of shops, a
number of comfortable lounges
and multi-storey buildings dedicated to short and long-term
parking. The airport also includes
a new Emiri Building for VIPs,
Qatar Airways buildings and facilities, new cargo buildings for
freight services, aircraft hangars,
in addition to a hotel with 100
rooms for transit passengers.
The people of Qatar have the
right to be extremely proud of
this huge achievement, fitted
with advanced features and the
latest technologies, Hamad International Airport is certainly a
world class development that will
be appreciated by many generations to come.
21
SHAPING QATAR
Oryx Island and Gulf Resort
Barwa proposes exclusive designs for
Qatar’s largest tourism investments
Qatar has long been closely associated with the Arab Gulf by a
special relationship established over the years as an important
source of livelihood for its people. Today this relationship acts as
an international gateway and an outlook for the beauty of nature
and the scenic blue waters for the Qatari people to enjoy. Even
though Qatar is surrounded by the Gulf waters from three sides it
relatively lacks recreational and relaxation getaways far from the
commotion of the capital city of Doha. For this reason Barwa set
out to develop designs of two unique projects on the Arabian Gulf
coasts to restore meaning and charm to this main geographical
component of Qatar, and turn it into a financially viable attraction
that’s stature matches those surrounding it.
Oryx Island… an integrated development
embracing luxury villas, an aqua park and
floating hotels
Oryx Island is a huge tourism investment, bringing to life the wishes of many Qataris by building a mixed-use resort on the Qatari
shores, helping to promoting inbound and outbound tourism whilst
contributing to the diversification of the national income. Inspired
by the ecosystem in Qatar, Barwa Real Estate has drawn designs
for Al-Maha Island, choosing “the Arabian Oryx” as its iconic symbol. Plans are intended to reflect the ambitions of the young state
of Qatar, striding towards upgrading the Qatari community, and
pushing it ahead to the ranks of other developed nations.
Barwa Real Estate Group proposed the Oryx Island Resort design
to be located on the Qatari shores in the midst of the Arabian Gulf
22
and close to the new Hamad International Airport. The tourist
residential Complex under construction is a mixed-use project surrounded by the Gulf waters, offering tenants a sense of privacy
beyond comparison.
Oryx Island provides supreme sophistication; consisting of a Maritime College to teach marine life and traditional pearl hunting
methods, floating hotels for temporary accommodation, private
homes, in addition to shopping and recreational facilities. The island will be equipped with necessary spaces to celebrate national events, which may include an open air theatre to be used for
watching the World Cup games in 2022.
Oryx Island is a pedestrian only resort; it will not use traditional
means of transportation, instead electrical vehicles, water taxis,
ferries and private boats will be available to transport visitors.
The project will provide three different types of villas and condos
equipped with a waterfront. The first type will include 135 private
villas, each enjoying an area of 1300m², 6 rooms and a picturesque garden furnished with modern relaxation facilities. Whilst
the second type of villa is of a higher luxury standard, 72 to 100
most significant of the three is the luxurious Tropical Health Club
Hotel, where residents will enjoy yacht rental services and tours
of the Qatari coastal strip and visit neighboring islands on the
Arabian Gulf.
Oryx Island will present 5 floating hotels for the first time in Qatar, to be featured temporarily to the west of the development
during the World Cup 2022 for provisional extra hotel capacity.
Additionally the floating decks will provide room for commercial
ships passing the gulf waters.
Oryx Island will host an aqua park which will cater for the more adventurous and a commercial
avenue for shopping lovers, featuring a variety
of upscale shops and restaurants, in addition to
libraries and electronics stores to serve residents
on the island.
Gulf Resort proposals … an
exquisite leisure destination in
Qatar
villas will enjoy an area of 1,300 to 1,700m², each overlooking the
private beach. The latter type contains residential units overlooking the sea and will offer residents a chance to enjoy the relaxing,
beautiful nature of the island.
The design plans for the Oryx Resort project propose building
three five-star hotels each overlooking a private beach and a panoramic view of the West Bay and Doha Corniche. Perhaps the
The proposed 250 hectares site for the Gulf Resort in “Abu Samra” on the Arabian Gulf overlooks the picturesque sunset of Salwa Bay. The
designs extract a blend of the golden desert
softness with the rugged rocky ridges and sand
dunes, a creative plan to revive the spirit of the
ancient Arabian Peninsula life, and stir communication with nature away from the hustle and bustle of modern society.
The proposed designs of this huge development include three hotels, an up to date shopping mall and a Corniche waterfront. The
site will also play host to an exceptional Marina, a naturally created harbor formed without human intervention.
The vision behind the Gulf Resort stresses the highest levels of
23
SHAPING QATAR
luxury and comfort, merging traditional architecture with contemporary design, by employing sustainable methods in the design process as well as management of the resort. The resort embraces a range of recreational activities for each family member,
offering a water park and spaces for educational facilities such as
the Aquarium that highlights the Qatari maritime heritage which
was considered a main source of income in the past.
The resort implores an innovative modernist style, embraced in
a special cultural setting, a magical invitation to experience the
aroma of heritage, nature, splendor of space and hospitality values in addition to recreational luxury and bliss.
The design of the built environment ensures safety and privacy;
it respects space and avoids imposed walls or overstated high
structural elements whilst enhancing interaction with the natural landscape and public taste. The site enjoys a panoramic view
where visitors can spot rock formations along both sides of the
road, and catch glimpses of the beach heading down to the resort.
At the center of the resort, a main square receives visitors in cars,
and walks them to their residence or towards the traditional marketplace. The area formed by narrow streets will be lined with
cafes and restaurants, some facing the sea allowing guests to
enjoy their favorite meals by the sunset across the marina, which
in turn will serve as a center for boat cruises and diving lessons. A
health club will offer special fitness routines, allowing you to draw
inspiration from the natural setting where visitors can try horseriding or go on safari trips in the surrounding desert.
24
A sustainable community
Both Oryx Island and Gulf Resort constitute a significant logistical and geological challenge, in particular with declining
natural resources offset by the economic crisis. Barwa plans
to overcome this by introducing sustainable design in modern
architecture, whilst incorporating energy efficiency schemes
throughout all elements of the development process.
The Oryx Island for example is intended to serve as a model
for sustainable urban architecture, illuminating Qatar’s vision
to build a sustainable community that enjoys a healthy lifestyle. A sub-development is to precede construction works to
clean and prepare the island site, which will help create an
eco-touristic setting and open room for conducting scientific
research to study the feasibility of commercial production of
salts and oils in the future, as the Arabian Gulf waters are rich
in salts and minerals. In addition, studies for potential generation of clean, renewable energy from wave power will take
place, fulfilling the futuristic environment-friendly vision Qatar
supports.
It is expected that both the Oryx Island and the Gulf Resort will
mark a quantum leap for touristic real estate in Qatar, and promote the state as the regional leisure destination, thus complementing Qatar’s National Vision 2030 which encourages diversification of national income resources. The two projects
will open the door to national and international investments for
more sustainable exploitation of the captivating Qatari coasts.
Image of Grand Mosque, Doha, Qatar
Restaurant on Beach, Doha, Qatar
Shopping Center, Doha, Qatar
Barwa City Schools, Doha, Qatar
Barwa Commercial Avenue, Doha, Qatar
Barwa City Health & Fitness Centre, Doha, Qatar
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HERE & THERE
Sports Day… a national advocacy
for an active healthy community
Large-scale celebrations featuring Qatar Olympic Committee,
government and private organizations
Doha has been celebrating its second year of National Sports
Day, involving a wide range of sports events and activities.
The vision behind this event emphasizes the significance that
a lack of fitness can have a negative effect on both personal
and interpersonal health.
Qatar’s Sports Day events have become an iconic day, distinct in its nationwide involvement. H.H. Sheikh Hamad bin
Khalifa Al-Thani led the National Sports Day celebrations by
riding a purebred Arabian camel at Um Ethnaytein. Heir Apparent, Sheikh Tamim bin Hamad Al-Thani, Chairman of Qatar Olympic Committee, celebrated the event by participating
in sports activities organized by the Qatar Orphan Foundation “Dhreima” at Al-Arabi Sports Club and continued on to
the celebrations held at the Khalifa International Tennis and
Squash Complex.
The Sports Day celebrations are supported and enjoyed by
the wider community, citizens and residents flocked to the
streets to participate in marches organized by the Qatar
Olympic Committee on Doha Corniche. The marathon was led
26
by Secretary General of the Qatar Olympic Committee H.E.
Sheikh Saoud bin Abdulrahman Al-Thani along with H.E. Abdulla bin Khalid Al-Qahtani, Minister of Health, H.E. Hasan
bin Abdullah Al-Ghanem, Minister of Justice, Mr. Bart Cahir,
President and General Manager of ExxonMobil Qatar, the official sponsor of the National Sports Day, in addition to Australia’s five-time Olympic swimming champion Ian Thorpe,
and other government officials.
This year’s National Sports Day celebrations included the
involvement of companies and governmental agencies, culminating into many entertaining, organized sports events.
Children with special needs received a lot of attention this
year through a variety of recreational sports activities that
integrate this important segment of the community with the
national celebrations. It was a chance to spread awareness
on the importance of fitness and health, through specially designed sports activities that catered to their special needs.
Barwa Real Estate Group played an integral role in celebrating the National Sports Day, along with Qatari Diar and a
number of real estate companies and banks.
Participating officials and leading members of the community
agreed with the wisdom behind marking the second Tuesday
in February as the annual National Sports Day and an official
holiday to stress the importance of sports in the strategic developmental plans that contributes directly to the growth of
society.
A communal website has been created by the Olympic Committee, allowing the community and various organizations to
advertise their activities to promote participation and awareness amongst the public. All sport clubs and federations
across the country participated in distributing leaflets, aware-
ness posters, and organizing activities, in addition to their active participation at the Doha Corniche marathon that kicked
off at 9am that morning.
These outstanding efforts of employees in ministries and
government agencies, as well as community-based bodies,
reflects the great interest in spreading awareness on the importance of sports in the lives of individuals and communities
alike. This also reflects a culture that has vision to see the
leadership qualities required to orchestrate such a sporting
event. Through the encouragement of sport we see a dramatic increase in society’s physical and psychological fitness.
The developmental vision that Qatar aims to achieve depends
on building a generation able to comprehend and implement
this vision. Through this, they shall make use of the health
benefits, both physically and psychologically, that come from
improved endurance and longevity.
A safety measure
On the occasion, Mr. Salah bin Ghanim Al-Ali, Head of National Sports Day Committee, affirmed the Emiri decision issued by H.H. Sheikh Tamim bin Hamad Al Thani, to mark the
National Sports Day as a holiday celebration, further enhancing the values of Qatar’s National Vision 2030, which is based
on investing in the human capital by preparing a healthy fit
generation that can march with the Renaissance of Qatar under the leadership of H.H. Sheikh
Hamad Bin Khalifa Al-Thani, the
Emire.
He added that this national
event promotes the importance
of sports as a safety measure to
protect children and youth from
obesity related diseases, such as
high blood pressure and diabetes, as well as increase the vitality of patients which can have a
major effect on recovery times.
Al-Ali had expected a quick and
positive response from government and private agencies,
particularly educational institutions to work on raising the fitness level in the community in
line with the objective of this
Emiri Decision. He pointed that
Qatar’s potential and resources
are abundant to easily achieve
this objective as the stadiums,
clubs and youth centers are
well equipped to attract men, women and children of all age
groups. The abundance of facilities that Qatar is offering has
the capacity for thousands of individuals to run, walk, cycle or
swim to keep themselves fit and healthy. The Aspire Park in
Aspire Zone and Doha Corniche are two such facilities which
have safe tracks for cycling enthusiasts. Qatar’s Second National Sports Day has been a well assembled event which
will be remembered for years to come. The willingness of the
community to participate in the events demonstrates the substance of the social, cultural and communal spirit that is so
rich in Qatar. The event holds testament to will of the people
to build a better tomorrow for everybody.
27
HERE & THERE
$106 Billion worth of major projects in Qatar
Barwa gears up for the FIFA
World Cup 2022
Building 12 high-tech world class stadiums
As we come closer to the countdown for Qatar’s FIFA World
Cup 2022, local and international real estate and construction
firms begin to increasingly compete to win large-scale infrastructure contracts in preparation for the global event.
Undoubtedly, the developments will not only target building
stadiums; they will also include building complete integrated
systems of residential complexes, tourist attractions, ecofriendly spaces, infrastructure and transportation networks in
Doha and its suburbs. Complying with modern technology, the
infrastructural face-lift will provide a unique environment for
real estate growth and showcase state of the art structural elements blending Qatari heritage with modern architecture.
Nearly USD$4 billion worth of projects have been invested in
preparation for the World Cup- recently issued by the World
Cup Supreme Committee. However, those figures may change
after implementation. According to MEED’s recently released
2011/12 Qatar Projects report, more than USD$106 billion
worth of major projects will be awarded between now and
28
2022, with significant investment in oil and gas, heavy industry,
electricity generation and water desalination, transportation
and social services.
The FIFA World Cup Supreme committee announced that construction work for the first stadium will commence in 2015, the
first of twelve other stadiums to be built specifically for the
event. The new iconic Lusail Stadium is expected to host the
World Cup opening ceremony. New eco-friendly technologies
will be developed to be able to cool large stadiums effectively
and overcome summer heat whilst maintaining efficiency and
protecting the environment.
In the coming years, Doha is expected to witness an increase
in inbound tourism. The number of tourists is expected to reach
1.7 to 3.7 million, compared with today’s 900 thousand visitors.
In this regard, Barwa Real Estate Group CEO Eng. Abdullah bin
Abdulaziz Turki Al Subaie says: “Barwa displays great interest
to participate in large scale projects related to the World Cup
2022. As a key regional player in the real estate market, the
group devotes all available expertise and resources to attend
to Qatar’s developmental needs
which are required for hosting the
big event”.
He added: “Under the wise leadership of His Highness the Emir, the
state works closely to strengthen
public private cooperation to support a vibrant climate for business and economic growth. The
world-class infrastructure underpins many investment-friendly
business opportunities to form
strategic partnerships.”
Al Subaie noted that the Barwa
Group had committed considerable resources for the implementation of mega sports projects
for this prestigious event, giving
weight to its outstanding team
of experienced and talented employees, capable of carrying out
such projects, thus competing
with global and regional real estate leaders.
The sports industry
The World Cup Event can be seen as an omen for resurgence
in the economy. The sports industry around the world has been
growing significantly over the past few years, today’s global
sports industry is worth USD$ 620 billion. Although the bulk
of growth comes from unexpected markets injecting 7% an-
nual growth, Qatar’s hosting of the FIFA World Cup will be
an opportunity for the Middle East to play a major role in the
growing sports industry around the world. It is expected that
this major event will contribute to 10% growth rate in the hospitality and tourism sectors in the region alone.
Realizing that Qatar’s hosting of the World Cup will play an
instrumental role in achieving the objectives of Qatar National
Vision 2030, the World Cup Supreme Committee is learning
from the success of previous models around
the world, and developing plans to ensure
sustainable economic growth for Qatar and
the region for 2022 and beyond. This year
will see serious initiatives put into action to
cater for this goal as announced by the committee.
The high profile FIFA World Cup is to be
held in Qatar in 2022 and is the culmination of government efforts striving to push
urban and economic development towards
wider horizons. It is the role of private and
public real estate firms, to take over and
contribute in full force with human, technical and engineering capital to build a mega
infrastructure, which will eventually serve
the Qatari community through a variety of
development opportunities which present
themselves daily.
29
AROUNDTHEWORLD
Recovery of Dubai real estate market
additional 45000 residential units over the next two years
The property market in Dubai remains a central pillar of the
Dubai government’s efforts of achieving a diversified economy. The mortgage crisis which led to the global economic
recession had an effect on the Dubai property market in mid2008. The property market bubble burst as an oversupply of
residential units, both on- and off-plan, coincided with excessive leverage carried by property owners.
With average prices falling by about 50% since their peak in
Q4 2008, new residential property developments have considerably slowed down following the onset of the real estate crisis in Dubai and has left the United Arab Emirates with a debt
burden of over $100 billion USD corresponding to about 100%
debt to Gross Domestic Product ratio. The increase in residential units in 2012, around 12,500 units, was 14% less than in
2011 and a full 72% less than in 2010. This disparity shows the
halt in growth for the property market in Dubai.
Future supply is however likely to accelerate once more as
investor confidence returns to the United Arab Emirates. With
30
an additional 45,000 units likely to come online over the next
two years, much of it will be concentrated in locations outside
of central Dubai, namely Dubai land, Dubai Sports City, Dubai
Silicon Oasis and Jumeirah Village. Each of these locations will
likely witness an increase in residential stock of about 4,000 to
6,000 units. In contrast, Business Bay and Dubai Marina will
likely witness an increase of about 7,000 units overall.
The real estate sector has begun its recovery, and despite asset valuations not being equal to those pre-crisis, prime locations have noticed resurgence in sales, leases and prices. The
Dubai Government’s objective to deliver economic diversification also appears to be progressing performance metrics in
the Dubai retail and tourism sector now qualify as regional
benchmarks. Dubai Mall alone boasted a record-breaking
footfall of nearly 55 million visitors in 2012, the same number
of people visited China, a nation of 1.3 billion people. In light of
this, the contribution of Dubai property market should be put
in a broader economic context: Dubai Inc., as a tourism hub, is
an unqualified success.
Key factors explaining the recent upward trend in sales and
leasing in the Dubai property market are as follows. Firstly,
political instability and its attendant consequences in many
Arab countries have triggered a capital flight to the Dubai
property market which is viewed
as a safe haven. Secondly, the
fall in asset values in Dubai has
coincided with an increase in construction costs, labor and raw materials, triggered in part by a push
from GCC governments to expand
their domestic infrastructure. With
average market prices falling in
some cases below the book value
of residential property, investors
seeking capital appreciation have
returned cautiously to Dubai property market. With robust population growth driven by expatriate
labor returning to the United Arab
Emirates, yields on Dubai property
remain attractive when compared
to other income producing asset
classes.
The rebound in the residential sector is likely to benefit from further
developments in other major asset classes, the retail sector
will continue to witness an expansion with planned additions
to Dubai Mall, new developments in the heart of Dubai such
as The Avenue on Al Wasl and a major retail push with the
Mall of the World. The mall will be part of Mohammed Bin
Rashid City, a mixed-use integrated development, to be built
by a joint venture between Emaar and Dubai Holding. The
new development, located between Emirates Road and Khail
Road is an ambitious “city within a city” development that
will encompass the Business Bay and Downtown Dubai and
spread south and inland on Dubai’s periphery. MBR City is
the Dubai government’s latest effort in building on its tourism
and retail strengths and will offer venues for family tourism,
the arts and the development of facilities that will encourage
entrepreneurship and innovation in the region. The Mall of
the World, located at the heart of MBR City, will be larger
than Dubai Mall, currently the world’s largest organized retail space. MBR City is expected to attract 35 million visitors
when completed and will benefit Dubai prime residential areas by providing amenities to be enjoyed by the community.
Dubai residential sector will also benefit from the United Arab
Emirates massive investment in its physical infrastructure, in
particular its impressive transport and trans-shipment network which supports important economic activities at the
foundation of the United Arab Emirates success, Dubai is set
to reap the rewards of the United Arab Emirates diversification strategy most notably through re-exports, manufacturing
and its most visible export, tourism.
31
THE
INBOXER
Do you have any questions regarding any aspect of the property sector in Qatar? From rental to sales and
commercial activity, THE INBOXER is a two-way communication between readers and property market specialists,
shedding light on your rights and obligations as market participants in Qatar’s vibrant property market. If you have
any queries you would like addressed in THE INBOXER, please send us an email to [email protected]
Doing business in Qatar
Response prepared by DLA Piper Middle East
Combating Trade Concealment and the Ministerial Decision regarding the Organising of Representative Trade Offices set out the foreign investment restrictions imposed on foreigners wishing to conduct business in Qatar.
The Commercial Companies Law provides the legal framework for
corporate governance in Qatar. The Companies Law provides for
various different vehicles, although only a limited number of these
are available to foreign businesses wishing to set up in Qatar.
Foreign investment law
The Foreign Investment law provides that the minimum shareholding held by Qataris in an LLC must be 51% of the company’s capital.
The maximum shareholding held by foreigners in an LLC must not
exceed 49% of the company’s capital.
In recent years, Qatar Government has more actively promoted
foreign investment in the country. Qatar’s Ministry of Business and
Trade has recently completed a new draft Companies Law with the
aim of modernising the existing legislation and simplifying the company set-up procedures.
New draft companies law
The new draft Companies Law proposes a number of changes affecting various types of companies. A key change relates to the Limited Liability Company “LLC”, currently the most common form of
vehicle for foreign companies setting up. A proposed change will be
to abolish a fixed minimum capital requirement, currently 200,000
Qatari Riyals, and allow for the shareholders to determine the company’s capital is sufficient to enable it to carry out its activities. It
is significant that the draft Companies Law provides the issue of a
Ministerial Resolution which will outline and simplify the procedures
under which companies will be incorporated in the future.
Current legal framework for doing business in Qatar
The Foreign Investment Law and the regulations under it, the Law
32
Trade concealment law
The Trade Concealment Law seeks to prevent foreigners from conducting any commercial or professional activities in a manner aimed
to circumvent the Foreign Investment Law. It also seeks to prevent
Qatari nationals from colluding with foreigners to circumvent it. As
such, any person found to be in breach of the Trade Concealment
Law will be criminally liable and may be subject to heavy fines and/
or imprisonment.
Companies law
The Commercial Companies Law provides for various vehicles under
which an entity may be established. The most common forms of vehicle used by foreign entities are (i) the LLC (ii) the so called Article
68 Company, (iii) temporary branch office (iv) the representative
trade office or (iv) an entity licensed by the Qatar Financial Centre
“QFC”, predominantly for entities providing financial services.
Limited liability company
The minimum capital of an LLC must be 200,000 Qatari Riyals, which
must be paid by the shareholders prior to incorporation. The LLC
structure allows shareholders to agree to split profits in proportions
different to the shareholders’ proportions, which reflect the different
degrees of participation that respective shareholders have and that
the management can be conducted by the foreign shareholder. It is
essential to note that the shareholdings in the capital of an LLC are
subject to the restrictions under the Foreign Investment Law.
Article 68 company
Article 68 companies are essentially joint ventures, owned partly
by the government or a public authority, in partnership with foreign
investors. The main advantage being that the Companies Law only
applies to the extent that it does not conflict with the Memorandum
and Articles of Association, Joint Venture Agreement or other contracts of establishment. The shareholders are to draft those documents with greater flexibility free from any of the restrictions outlined under the Companies Law. The law also provides the foreign
investor’s share ownership in the Article 68 company can be more
than 49%, subject to the approval of the Council of Ministers.
Temporary branch office
Another option is that the Ministry of Business and Trade may grant
a temporary branch licence to establish an office to operate in Qatar to a foreign company which is party to a contract with a state
agency. The foreign company becomes fully licensed and registered
in Qatar. However, the license and registration are based upon the
contract and therefore limited to the duration and the works to be
performed under it. The duration of this branch can be renewed if
additional contracts are obtained with any state agency. New contracts must be registered and appended to the foreign company’s
commercial registration. A company which is a party to a subcontract stemming from a main contract with a state agency may also
qualify.
Representative trade office
It is permissible to establish a representative office “RTO” in Qatar
as a means of establishing a “shop window” owned by a foreign
party, which can be used to promote a foreign company to introduce
it to Qatari companies and projects. The RTO cannot be used to earn
revenue. The establishment of such an RTO is granted by Ministerial
approval.
QFC
The QFC operated by the Qatar Financial Centre Authority is a financial and business centre established by the Government of Qatar in
February 2005. The QFC Law permits 100% ownership of authorised
institutions by non-nationals and a complete repatriation of profits.
The QFC’s commercial and regulatory environment and systems
conform to international standards and are separate from and independent of the existing Qatari systems. The QFC Regulatory Authority “QFRA” manages and enforces the QFC’s regulatory systems,
while the QFC Companies Registration Office, registers limited liability companies and limited liability partnerships within the QFC. The
QFC law prescribes a range of activities which may be conducted in,
or from, the QFC. These activities are primarily financial services or
related support services.
Commercial agency
Should a foreign entity wish to make direct sales in Qatar without
establishing an entity, then it may choose to enter into a commercial
agency with a local entity already established in the country. Qatar’s
Commercial Agencies Law states that a person will be regarded as a
Commercial Agent if they have the exclusive right to sell, trade in or
distribute the products of the principal. To be afforded protection of
the Qatari Commercial Agencies Law, the agency agreement must
be registered and the agent must either be a Qatari national or a
company wholly (100%) owned by nationals.
Tax liability
Qatar’s Tax Law imposes a 10% corporate tax on non-Qatari net profits attributable to residents and permanent establishments. The Tax
Law also imposes a withholding tax of 5% on royalties and technical
fees and 7% on any other payments applicable on gross payments
made to a non-resident with no permanent establishment in Qatar.
Qatar’s Custom Law provides that goods imported into Qatar will
be subject to a 5% ad valorum tax duty. Exemption only applies to
goods that have been manufactured within Arab countries.
Conclusion
Starting a business in Qatar has become more appealing to foreign
investors in light of Qatar hosting the FIFA World Cup in 2022 and
Qatar’s vision of 2030, bringing greater economic vibrancy in Qatar
for years to come. One looks forward to proposed amendments to
Qatari laws and their potential impact on future foreign investment.
Note: This article is only a general introduction to some legal issues
and laws in Qatar. It is not legal advice and should not be relied upon
as such. If any reader requires legal advice, this should be obtained
from an experienced lawyer who can provide advice which is tailored to the relevant facts and circumstances.
33
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