Regional real estate sector will continue to boom, says Tamweel CEO

Speaking today at the opening session at Cityscape, Adel Al Shirawi called for a robust regulatory framework and greater focus on global best practices in order to maintain current growth.

Sounding a cautionary note, Shirawi said the number of units expected to be supplied in 2007 is 43,000. This number of actual deliveries is expected to further reduce to 30,000 due to construction and delivery delays, ensuring that supply would fall far short of demand. He also said that the demand for commercial space was expected to grow annually by about 6 million square feet till 2009.

"Real estate is fast becoming the second engine of growth in the regional economy, which is no longer driven chiefly by oil," said the Chief Executive Officer of Tamweel.

"This is the ideal time for government and developers to work together towards the growth of this sector. The government should focus on introducing more regulations in the real estate sector, including bringing the current 15% rent cap to 5%. The government must also dynamically assess demand and supply across all segments, and licenses for property development should be issued accordingly."

Shirawi said that developers need to improve the quality of their developments to meet global standards and ensure that all delivery schedules are met to further drive growth in the UAE real estate sector.

He also pointed out that although real estate contributes about 40% to growth in most developed countries, the mortgage sector's contribution only accounts for 3.5% of GDP. He said that mortgage financiers could open the gates to foreign inflows into the region and further add value by acquiring global ratings for mortgage assets.

The Tamweel Chief Executive Officer spoke as part of a panel discussion titled, "Is the region truly ready for international investors' scrutiny? Emerging trends and alternative futures." The discussion was held from 12:15PM - 1:00PM at the Dubai International Exhibition Centre.

Other speakers on the panel discussion included Lee Tabler, CEO, TDIC; Saud Al-Gusaiyer, CEO, Dar Al-Arkan; Mounir D. Haidar, CEO, Sorouh Real Estate; and John Shaw, CIO, Aldar.

Cityscape Dubai 2006: The 5th International Property Investment and Development Event takes place from Monday, December 4 - Wednesday December 6. It is one of the world's largest B2B real estate events, with more than 85 countries represented.