By Dr R Seetharaman
A balanced budget was announced by Qatar for the fiscal 2018. Transportation and other infrastructure projects were assigned the largest share with allocations of QR42.0bn. These projects include the Metro, Lusail Light Train, and Al Bustan Highway, Orbiter Expressway, Al Rayyan/Dukhan Road and Al Khor Coastal Road.
Sports sector and 2022 FIFA World Cup projects amounted to a total allocation of QR11.2bn in the 2018 Budget. These are primarily focused on the completion of stadiums in Lusail, Qatar Foundation, Al Rayyan, Al Wakrah and Al Khor, in addition to other sport projects. Increased government spending and mega deals in pipeline are some of the growth triggers that would help recover the property market in 2018.
In Qatar residential market in the last year, landlords have largely become more willing to accept rent-free periods or reduce rental expectations in vacant properties. This has been due to additional supply and an increase in vacancy rates following a five-year period of undersupply and strong rental growth.
A number of new residential buildings have been completed in districts such as Umm Ghuwailina, Al Sadd, Bin Mahmoud and Al Mirqab.
Qatar’s retail property market remains underpinned by the high disposable income of a significant section of the population. The opening of malls, including Doha Festival City, Al Hazam Mall and Al Mirqab Mall, have added more commercial spaces, increasing the supply of organised retail space.
Northgate Mall, Place Vendome, Doha Mall, Doha Oasis, Katara Plaza and Al Waab Mall are among those which will be opened over the next three years.
Qatar’s hospitality market is expected to demonstrate the fastest annualised growth of more than 10% over a five-year period up to 2020, owing mainly to tourism-related developments ahead of the landmark FIFA 2022 World Cup to be held in the country. In 2017 saw a new set of hotels arrive on the market, including The Town Hotel in Msheireb, and The Millenium Plaza in Al Sadd.
Qatar plans to award contracts worth $29bn to the private sector in order to encourage diversification and focus on supporting food security projects, small and medium enterprises, and the development of infrastructure in economic zones and free trade zones.
Qatar is also considering the possibility of increasing the area of agricultural land in the country. The number of farms are likely to be increased in the coming years to 2,000, working on the production of vegetables, fruits and other items that would be supplied to the local market.
The Public Works Authority, Ashghal, which is the most active government department in Qatar, has released several major new tenders since June 2017. These include the interim improvement of the A Ring-Road, treated sewage effluent tanker-filling stations, new health centres, and a foul sewer network.
Other key projects include Barwa Real Estate Group’s affordable housing scheme on the Salwa Road; Qatar Airways’ new Oryx Tower Development and Katara Hospitality’s planned refurbishment of the Somerset West Bay Hotel.
Infrastructure spending can give momentum to Qatar’s property market. On the whole, the Qatar property market is delicately poised.
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