Tawfiq Al-Jarrah, Kuwait Real Estate Union Chairman

KUWAIT: In the presence of elite decision makers, developers, investors and key stakeholders of the real estate market, and for the first time in Kuwait, Cityscape hosted a Business Breakfast at JW Marriott Hotel in Kuwait City. In an intimate environment, the panel of experts provided key insights into the industry by discussing and debating local and global real estate with a focus on investment trends.

The event presented a perfect platform to build new business relationships and network with top real estate market influencers, experts and leading real estate investment and development industry insiders.

As a preview to the upcoming premier real estate investment and development event - Cityscape Kuwait, being held on December 9-11 - this exclusive event introduced some of the most important themes that will take place during the exhibition at the Kuwait International Fairgrounds in Mishref.

The various high-profile discussions centered on possible changes to the economic framework of the GCC states due to natural resource instabilities, while stressing real estate will play a significant role in long-term economical sustainability with the region.

"In analyzing the real estate market in Kuwait, it is important to broaden the landscape to include a global scope. Historically, Kuwaiti citizens and residents have pioneered overseas property investments by setting the trends for real estate hotspots. By discussing the current state of the Kuwaiti real estate market, there is also a need to expand the topic to cover transnational areas which have typically been points of attraction for Kuwait-based investors," said Ahmed Zakaria, Exhibition Managerof Cityscape Kuwait, in his welcome note at the Business Breakfast.

Tawfikh Al-Jarrah, Chairman of the Kuwait Real Estate Union, stressed in his opening speech at the event: "the core issue in the real estate business in Kuwait is limitation of land, noting that in Kuwait; only 63 square meters of land is obtainable per person whereas 194 m2 per person is obtainable in Bahrain, 468 m2/person in Dubai and 171m2/person in Riyadh, causing pressure on land prices and contributed to its significant rise. He also added that "Kuwait suffers from a large gap in private housing, noting that it is expected that the number of new requests for housing over the next twenty years will be234000, bringing the total number of applications to 352 000."

As for the monthly rental rate, Al-Jarrah said that there is a clear rise in the rental rate, with an average monthly rental rate of 313 KWD, while in the last year it amounted to 264 KWD, describing that this sector is doing well in terms of performance and stability.

Commenting on office building sector, Al-Jarrah said: "There is a wave of improvement that have been accompanying the sector since 2011, in which the occupancy rate fell to 60 per cent, but now they are up to 85 per cent."

High rental prices

Tawfiq Al-Jarrah also pointed to the high occupancy rate in the retail sector, as the total retail space has reached about 800 thousand square meters in the second quarter of this year, with an occupancy rate of 95 per cent with high rental prices. The influential panel chosen to speak at the Kuwait Business Breakfast gathered experts from a cross-section of the business world. From the media sector, Ahmed Bou Merhi, Head of Kuwaiti Business News at Al-Arabiya News Channel and Head of the Business Department at Al-Anbaa newspaper, moderated the panel.

As a panelist at the Business Breakfast, Naser Faisal Alkhaled, Head of Real Estate Funds at Global Investment House, said Kuwait has limited realestate opportunities in comparison with UAE market which is a big and lucrative market". On the other hand he confirmed that the housing real estate sector in Kuwait is currently witnessing tremendous growth in demand.

Analyzing other real estate markets in GCC, AL Khaled said: "KSA market is the strongest in terms of demands and offers best investments opportunities while both Qatar and Bahrain are relatively small markets.

Another panelist at Cityscape Kuwait Business Breakfast was Bassam Al-Othman, Executive Vice-President, Kuwait Financial Centre - Markaz, who elaborated: "saying if oil prices reach 55-70 USDthe impact on the real estate sector will be minimal and that applies on all of KSA, UAE markets subject to their economic dependence on oil".