Late Entry is No Disadvantage for Middle East Real Estate
MIDDLE EAST - Late entry into global real estate "is no disadvantage" for burgeoning Gulf economies, according to Blair Hagkull, managing director of Jones Lang Lasalle in Middle East and NorthAfrica (MENA).
His comments came as the firm announced the appointment of Graham Coutts to the new post of international director and head of strategic consulting for the region.
"Real estate markets in the Middle East are the most buoyant in the world," Hagkull told IPE Real Estate, citing Gulf Cooperation Council (GCC) countries' fast-growing economies and "political leadership" as reasons for attracting investment.
"The bottom line is that there are benefits associated with late entry. The chief one is that you can see what has been successful and what has not," he said.
Hagkull said "global mega-trends" were emerging in the region, including the repatriation of capital after 9/11 and the impact of the oil boom, which he said "won't diminish anytime soon".
"You're beginning to see what's happened in Dubai emulated in other Gulf markets, notable Abu Dhabi (in United Arab Emirates) and Saudi Arabia, "the economic engine of the entire region".
With significant real estate acquisitions from Middle East investors in Europe, international capital is also flowing into the Gulf after its markets opened to foreign direct investment in 2001-2002.
"It started out as local interest, then it went regional," said Hagkull.
"This year we've been seeing more global investors entering the region - not just from Europe and the US but from Singapore, Korea and Australia. It speaks to the buoyancy and sustainability of the region," he said.
In the past year, the firm has doubled its operations in the region, opened new office in the United Arab Emirates, and spent $12bn on real estate projects across the region.
Author Shayla Walmsley