Qatar’s real estate market is showing signs of growth as 2021 ended positively with the recovery of rents in the residential market, leading international consulting firm ValuStrat has said in a report released on Wednesday.
According to Qatar Real Estate Market 2021 fourth-quarter review by ValuStrat, median residential rents in Qatar saw a quarterly increase for the first time since 2015, driven by temporary uplift in demand arising from the removal of social mobility restrictions and an increase in population during the last quarter of 2021.
There is anecdotal evidence of an increase in demand for rentals from new people entering the workforce in the hospitality, medical, oil and gas and technology sectors, the report said.
Compared to the third quarter of 2021, the report said, rents listed for apartments marginally increased by 0.8 percent.
“Median monthly rent for one-bedroom apartments stood at QR4,750, for a two-bedroom apartment at QR7,000 and for a three-bedroom apartment at QR7,750. Median monthly asking rents for three-bedroom villas were QR10,000, four-bedroom villas at QR11,250 and four-bedroom villas at QR 12,000,” the report said.
As of the fourth quarter, the report said, total completions for 2021 stood at 400 villas and 4,380 apartments. As many as 480 apartments were handed over during the fourth quarter of 2021 with the delivery of a tower in Abraj Bay on The Pearl and a residential tower in Lusail.
By 2021, completed apartments were concentrated in The Pearl with 30 percent, Lusail took 25 percent and 15 percent in West Bay. Compounds in Luqta, Al Aziziya, Onaiza and Al Wakrah comprised the majority of the villa completions in 2021. Forecasts for residential units in the pipeline for 2022 has been adjusted upwards to 15,000 units.
While sales during the last quarter of the year fell by 27 percent compared to the fourth quarter of 2020, the report said, the overall total volume of transactions during the whole of 2021 was 4 percent higher than 2020. The median ticket size for houses was QR2.7 million, remaining unchanged compared to the third quarter of 2021 and up by 4.7 percent year on year.
“Muaither, Umm Garn and Al Khor had the highest volume of transactions of residential houses during 2021. The year 2021 recorded 212 transactions for residential buildings. Old Airport, Umm Ghuwailina and Al Wakra comprised 35 percent of the total volume for the year,” the report said.
Furthermore, the hospitality market grew as occupancy and Average Daily Rate (ADR) increased by 11 percent and 6 percent respectively.
“The average occupancy of hotel and hotel apartments, excluding properties used for quarantine, was 64 percent as of November YTD 2021, up by an average of 11 percent annually. ADR for hotels and hotel apartments stood at QR410, growing annually by 6 percent,” it said.
According to the report, Asia and GCC provided the largest source of inbound tourist arrival.
About hotel supply in 2021, the report said, “An estimated 1,980 keys from eight hospitality properties were added during 2021, comprising 28 percent of the preliminary forecast for the year. Steigenberger Hotel Doha with 206 rooms and Zulal Wellness Resort with 180 rooms were unveiled during the fourth quarter of 2021.”
As per ValuStrat research, hotel and hotel apartments stock exceeded 30,000 keys and the pipeline for 2022 was adjusted upwards to 13,300 keys.
Growth in tourist numbers during FIFA Arab Cup 2021, exhibitions, promotions and winter holidays provided a boost to footfall at malls during the quarter.
Approximately 38,000 sq m Gross Leasable Area (GLA) of organised retail space was added during 2021, resulting in 1.96 million sq m GLA of shopping centre stock. The pipeline for 2022 was updated to 550,000 sq m GLA distributed across seven malls in The Pearl, Lusail, Musheireb, Umm Salal Mohammed and Al Maamoura.
About office space, the report said, “An estimated 220,000 sq m GLA of office space was completed during 2021, constituting 40 percent of the initial projection at the start of the year. The majority of the completed workspace during 2021 was located in Lusail and the remaining completions were in various zones of Doha municipality. Total office stock stood at 5.6 million sq m GLA with no additions during office during the last quarter of 2021. The pipeline supply for 2022 was adjusted to 1.2 million sq m GLA.”
“The citywide median asking rent for offices was QR73 per sq m per month, down 1.4 percent quarterly. Promofix, PwC Qatar, EgyptAir and the Ministry of Justice (MoJ) opened new offices in Doha. The majority of the new offices in Lusail quoted rents above the citywide median, causing upward pressure on asking rents in the area during the quarter. The median asking rent in Al Sadd stood at QR66 per sq m,” it said.