Interview: Abdulrahman M Darwish
What role do you expect public-private partnerships (PPPs) to play in the future?
ABDULRAHMAN DARWISH: Qatar has demonstrated an impressive record of economic growth over the past decade, and PPPs can play a key role in addressing challenges of efficiency and capacity. They can help establish a long-term commitment from international and local companies, and contribute technical knowledge and expertise that are not necessarily present in the public sector. The dynamics of the private sector could also provide greater efficiency gains for public services and infrastructure projects than those executed solely by the state. The involvement of private companies through the life cycle of a given project will ensure that operators remain accountable for the delivery of sustainable quality. Furthermore, the private sector is expected to introduce new ideas and provide greater innovation in order to execute high-quality works at competitive costs.
Private firms can attract capital both through their own equity, and their ability to secure financing for projects. Besides the private sector’s aim to generate returns commensurate with the risks assumed, each investment has its own minimum return expectation. Therefore, PPPs can become an instrument to obtain excellence in infrastructure development – thereby helping to fulfil the important task of socio-economic development – by utilising sophisticated organisational, management and production technologies.
Which emerging technologies are set to have the biggest impact on the sector?
DARWISH: Technology is advancing with every passing day, providing contributions to every sector of the economy, including real estate. One of its main applications is in the creation of smart homes, a concept that incorporates an innovative, wireless system that enables occupants to tailor their living environment to their requirements. Highly advanced home-automation systems for lighting, temperature control, multimedia entertainment, security, and window and door operations can all be accessed and controlled remotely through smartphones.
Qataris are set to respond well to the application of this smart technology, as it has the potential to reduce energy use: trigger preventative maintenance; track actions such as motion, light, temperature and water flow; and decrease operating costs. Its features will control data to make life more comfortable for residents and deliver the most modern living experience. Therefore, the most tangible results from the application of smart technologies to the real estate market will be in property management, environmental control and security. I believe that the adoption of smart home technology in Qatar will be significant, as the real estate sector requires innovation to keep up with the modern way of living.
How can the Qatari real estate market be made more attractive to international investors?
DARWISH: The Qatari government has developed great business conditions for real estate buyers and investors. Besides permanent residency, free health care and education provided to foreign investors by the government, real estate owners may also benefit from long-term incentives such as stock options. This offers an employee the right to buy a certain number of shares in a given entity at a fixed price for a certain period of time. The price the company sets for the stock – called the grant or strike price – is usually discounted from the market price of the stock at the time the employee is granted the option. Long-term incentives are generally used as a vehicle for wealth creation for the senior members of an organisation, but also serve to tie a valued member to the organisation for the long term. This incentive should be examined with great care to assure an in-depth understanding of all aspects of their governance.
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