Bahrain Property

Bahrain Financial Harbour

Bahrain is being noticed as one of the best property markets in the Middle East for foreign investment.

The Middle East is a surprisingly popular property investment and relocation destination because of the wealth and job opportunities. Dubai was the number one spot for this before the crash, but now people are being put off by the continued volatility in the market; with failed developments littering the landscape and property prices still faltering. Could Bahrain take its place?

Bahrain is an oil-rich country, in which oil revenues account for a domineering 25% of gross domestic product. Keen to diversify its economy, the government is very much behind the property market, and is taking every measure possible to make it easy for foreigners to buy property in Bahrain. For instance foreigners can now apply for yr residency, which allows them to buy property freehold and is easily renewable every five years.

Bahrain property prices fell by only 10% during the recent downturn, which is a solid performance compared to Dubai (300 miles east) where prices fell by closer to 50% at last count. Whereas many Dubai developments were cancelled, Bahrain’s were only suspended, and, according to reports all have now been resumed.

But that is not the only difference; developments in Bahrain are focussed on low-rise elegance rather than high-rise razzmatazz.

However, in other ways Bahrain is driving down the same roads as Dubai did, for instance walking round show apartments and villas in Bahrain you would be forgiven for thinking you were in a Marbella show house, with modern marble, granite and chrome dominant throughout.

This is not a fault though; Bahrain wants to become a global real estate destination, and is rightly taking an international outlook on all aspects of property sales in order to do so, right down to the Marks and Spencers food in the show-house refrigerators.

When you look at Bahrain now, you can see that it has the makings of being a sought after location for foreign purchasers; shops familiar to the west, i.e. BHS, M&S, Debenhams and Virgin line the streets, as well as designer boutiques by Gucci and Burberry, and the new luxury developments are being built around PGA golf courses.

Bahrain is currently playing catch-up with Dubai, which is still one of the world leaders in business infrastructure. But this is easily made up for by the better economic prospects and stability in the property market.

Bahrain is keen to avoid and hyperbole being attached to its construction industry and property market, so as not to deter foreign investment over fears of over-supply. Barring a few hiccups, like the 60 burial mounds — some 4,000 years old — razed by developers in a Buri village, which Bahraini authorities wanted to win UN designation as a world heritage site.

Hiccups aside, Bahrain could easily replace Dubai as the hottest place for foreign investment and relocation in the Middle East and therefore in the world.

Photo credits: Fractal via Flickr

Dilmunia Health Island in Bahrain

Health tourism is known to be one of the fastest growing segments in international tourism. This is where people from developed countries travel to other countries to seek medical care. Most commonly this is people travelling to a country where cosmetic surgery is cheaper and therefore more affordable for them, but there are also growing numbers of wealthy people from poorer countries travelling abroad for better medical care, especially for essential treatments.

towers-in-bahrain-manama
Bahrain’s real estate market is looking to have come to a stand still over the last few months. While the global crisis won’t affect Bahrain as heavy as it does other markets, local real estate agents record flagging sales numbers saying “Prices over the past months have been fairly static, nobody is buying and nobody is selling, there’s little activity”. This was told by Mike Williams, senior director at real estate adviser CB Richard Ellis in Bahrain.

Tashyeed Properties, a Bahrain based property developer announced it’s freehold luxury residential tower, the Sukoon Tower, on Jan 8th 2008. Just 8 days later, they announced the fact that sales of apartments in the Tower in Juffair have been progressing well – more than 70% of phase one have already been sold.

Mr. Redha Rajab, Managing Director and Chief Executive Officer of Tashyeed said, “The sales team has had a great deal of interest in the project and we already have potential investors looking at apartments available in the second phase,”

“We believe the strong sales in Sukoon Tower have come from the attention to detail that has been put into the project. From the outset, Tashyeed Properties has worked with internationally renowned architects and interior designers to ensure the apartments and facilities at Sukoon have been designed with the resident’s comfort in mind.”

Top-of-the-range fixtures and fittings have been chosen including western style kitchens and bathrooms which is certainly nice to know, as we dread to think the sort of havoc a Tanour could cause the fire alarm system.

Well, we know where we’re retiring to. Along with half the estate agents on the planet we suspect. Bahrain’s Ithmaar Bank has announced the planned development of a $1.6 billion island for the healthcare industry. Dubbed “Health Island,” development is due to start “soon”, said a bank official who refused to be named.

As well as medical facilities, hotels and apartment buildings are planned for the island, which will be located off the north coast of Bahrain near Muharraq.

Investors are eyeing the Gulf’s healthcare industry as the region’s population booms, and the government becomes less willing to provide the free healthcare it has in the past. Ithmaar is also working on a $1.2 billion beach resort and a $175 million hotel that complies with Islamic law also to be located in Bahrain.

BAHRAIN is being hailed as a ‘boomtown’ after achieving the highest tourism growth in the GCC in the first quarter of this year – followed up by healthy summer figures.

Tourist arrivals in Bahrain soared by 30 per cent in the first quarter, way ahead of its nearest rival Dubai, which achieved 7pc growth, according to UN World Tourism Organisation figures.

Occupancy in five-star hotels also increased by a remarkable 20pc from last year, Five Star Hotel Owners Committee chairman Abdulrahman Morshed told the GDN.

The arrivals figures, first reported by the GDN in July, are mirrored in a report released by the Abu Dhabi Investment House (ADIH), which hails Bahrain as a ‘boomtown’ and predicts that the huge volume of real estate investment in the Gulf will continue.

“Judging on the results of the first quarter of this year, there is growth of up to 30pc,” said Mr Morshed.

“The hotel occupancy in Bahrain this summer was also exceptionally good.

“I think there are a lot of things that contributed to this growth this year.”

Mr Morshed said that when the Lebanon war broke out in July, tourists who had planned to visit there had come to Bahrain instead.

“This has contributed to the growth here, as Bahrain is just next door,” he said.

“Bahrain weather-wise is slightly better than Saudi Arabia and Kuwait and so for a change families came here to enjoy their summer holidays.

“I am sure we have benefited from that factor of the war in Lebanon.

“There were large groups of predominantly Saudi and Kuwaiti families in Bahrain this summer.”

Another factor would be the fact that businesses in Bahrain, compared to its neighbouring countries, remain active even during the summer.

“People here continue what they are doing in the summer,” said Mr Morshed. “Things do not die down because it is summer and the five-star hotels reducing their rates from BD54 to BD38 has helped in the growth.

“We continue to promote our properties in Bahrain and this encourages people to come and visit.”

But more needs to be done to attract more families to Bahrain, said Mr Morshed. “We still can’t compare the leisure side of tourism in Bahrain to Dubai,” he said.

“Children who visit Bahrain either have to have babysitters with them or go to shopping malls or cinemas and walk around in the cold air.

“There are not many attractions here for youngsters, unlike in Dubai, where there are theme parks.

“Bahrain needs these kind of attractions badly and hopefully as the Tourism Board becomes a reality here, we will focus on that shortage.”

But like Mr Morshed, ADIH remains hopeful that Bahrain will achieve further growth in tourism.

Its chief executive officer Rashad Janahi said that reservations for The Lagoon Bahrain, launched only in July, have passed the 60pc-mark.

The Lagoon Bahrain is the region’s first freehold commercial development on Bahrain’s $1 billion (BD378 million) Amwaj Islands.

“The speed with which investors are reserving this project consolidates our belief that the freehold real estate market in Bahrain and indeed throughout the Gulf is here to stay,” said Mr Janahi. “Tourism-driven retail and hospitality developments throughout the Gulf are continuing to drive the economy.

“New shopping centres, leisure attractions and hotels are enticing ever-increasing numbers of holiday-makers both from throughout the world and within the Gulf, driving more investment as a result.”

ADIH real estate executive director Nicholas Fraser explained the confidence spreading through the Gulf, suggesting that growth in the real estate sector has been further spurred in recent months with the shift from the residential market towards commercial property development.

“One reason that Dubai is the biggest destination brand in the Gulf is due to its introduction of the residential real estate freehold concept, where individuals could own their properties for a period of years,” he said.

“Dubai not only introduced this before other cities, it also allowed a much easier flow of expatriate visitors and residents than its regional counterparts.

“Bahrain has now taken the lead in the area of commercial property, with The Lagoon Bahrain providing premium freehold opportunities for new concept food and beverage outlets and boutique retail, a first for the Gulf, which has previously only offered rented commercial space.”

In tandem, Bahrain has stepped up efforts to build its tourism infrastructure with construction underway on theme parks, entertainment venues, hotels and property, and many more plans are said to be in the pipeline.

“The 2004 addition of Bahrain to the Formula One Grand Prix circuit gave tourism in the country a great boost,” said Mr Fraser. “The Lagoon Bahrain is set to join the list of landmark ‘must visit’ destinations for visitors to the Gulf.”

The 1km long, waterside, retail and dining destination sits in the company of London’s Covent Garden and Cockle Bay Wharf in Sydney, with top-flight stores and restaurants open throughout the day and into night from September next year.

Source: Gulf Daily News

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