Colliers launches most comprehensive regional real estate report on eve of Cityscape Dubai

The first and most comprehensive regional overview of its kind provides comparative key performance indicators across 10 markets in the Middle East and North Africa (MENA).

According to the report the demand-supply dynamic remains positive across the region.

However, against the backdrop of the global credit crisis regional investor sentiment is leaning towards a more cautious approach to the market.

As investors from around the globe gather for the start of the Cityscape Dubai exhibition, the Colliers report reveals some interesting insights for the MENA region.

Investment activity will shift in focus to properties where quality of product, location strength, supporting leisure and commercial amenities and effective facility management meet end-user requirements.

Ian Albert, Colliers Regional Director explains:

"We believe that the MENA region remains an area of strong potential for real estate investment comparative to other global markets. However, we do foresee a return to fundamentals, especially in the more advanced markets, where strongly differentiated developers with a view to the end-user able to satisfy the market will be best placed to deal with any market correction."

Extracted from Colliers' in-depth research studies into the office, residential, retail and hospitality sectors, the overview highlights the regional and local factors affecting real estate markets in Dubai, Abu Dhabi, Riyadh, Cairo, Doha, Muscat, Amman, Damascus, Khartoum and Tripoli.

It is the only report to offer comparative data on average rents, average sales price, yield, and occupancy rate as well as Colliers' outlook until 2010.

Despite differences in socio-economic, demographic and regulatory factors between the markets, the overview highlights common themes: economic diversification funded by petrodollar liquidity, improvements in regulatory and institutional frameworks, developments shifting from public municipalities to individual (though often government-owned) developers, and the increased demand for and supply of leisure and high-end developments.

Common risks include a focus on premium products, an increasing scope for a supply glut caused by copy-cat developments, inflated market speculation and barriers to end-user participation which include entry level prices and access to finance.

"Across the regional property markets we've seen a case of 'bandwagon investment' where secondary tier developers seek to replicate the success of first movers by building similar products en masse. In the current climate market segmentation and product differentiation will be key. We expect those developers that establish themselves as strong brands and deliver quality products should outperform their competitors," said Albert.