News: The Dubai International Financial Centre (DIFC) has announced that it is seeking property firms to develop 17 buildings in joint ventures, according to Bloomberg. The DIFC will contribute the land, while developers will finance construction on the projects, which are expected to be worth a total of AED15bn (US$4.1bn). The developments are planned to be 65% office space with the rest residential and retail, as well as one hotel. The area is a tax free zone, meaning it has lower office vacancy rates than the rest of Dubai.
BMI View: Sentiment towards the real estate market across the UAE has been improving significantly over recent quarters, with the consensus being that 2013 will mark a turnaround in a sector previously blighted by over-supply, instability and the hangover of a burst property bubble. Economic activity across the UAE is likely to remain relatively robust as consumption and investment patterns are holding up well in 2013. This economic growth will strengthen both property fundamentals and capital markets in the UAE, resulting in a more favourable outlook for tenant retentions, rental growth, development activity, financing and asset values.