Real Estate and Construction
From The Report: Bahrain 2013
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With instability in the real estate sector largely stabilised after a slump in the property market, the government and private firms are focusing on the issue of affordable housing for nationals, with a plan to provide housing to 54,000 Bahrainis waiting for a subsidised government home. In the construction sector, plans are also in place to improve transport infrastructure, with roads and bridges set to receive the greatest share of funding. There has also been a renewed commitment to ensuring greener building regulations, and while the current emphasis in Bahrain is on affordable housing, this could open up new opportunities for green initiatives that also reduce costs for the construction sector.

This chapter contains interviews with Essam bin Abdulla Khalaf, Minister of Works; Mohammed Khalil Alsayed, CEO, Ithmaar Development Company; and Christopher Sims, CEO, Naseej.

Articles from this Chapter

Overview

Toward stability: Taking advantage of the slowdown to focus on affordable housing
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The local real estate sector has yet to return to the strong growth of the past decade, but more forward-thinking investors have realised that under the current market conditions, there are still plenty of opportunities for development in Bahrain. Given the recent overall slump of the market, there is less demand for luxury property, including high-end residential, commercial or office space, which are typically found close to the Bahrain Financial Harbour or the World Trade Centre. Indeed, these…

Interview

OBG talks to Essam bin Abdulla Khalaf, Minister of Works
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Interview:Essam bin Abdulla Khalaf What efforts are under way to enhance Bahrain’s transport infrastructure and ease congestion? ESSAM BIN ABDULLA KHALAF: The implementation of major transport infrastructure projects has proceeded according to the Highway Master plan, is on schedule and it will even be expedited, following the influx of GCC stimulus funding. The BD98m ($247.9m) North Manama Causeway for example, is now expected to be completed by July 2013, which is earlier than planned.…

Interview

OBG talks to Essam bin Abdulla Khalaf, Minister of Works
OBG
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Interview:Essam bin Abdulla Khalaf What efforts are under way to enhance Bahrain’s transport infrastructure and ease congestion? ESSAM BIN ABDULLA KHALAF: The implementation of major transport infrastructure projects has proceeded according to the Highway Master plan, is on schedule and it will even be expedited, following the influx of GCC stimulus funding. The BD98m ($247.9m) North Manama Causeway for example, is now expected to be completed by July 2013, which is earlier than planned.…

Analysis

Residential property: The housing market is beginning to stabilise
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With regulatory, political and other events adding turbulence to the market in recent years, the residential segment is one of the more dynamic parts of the real estate market in Bahrain. More promising still is that future growth in this sector will be sustainable, in contrast to the often-speculative growth in the sector in the past decade. “During the years leading up to the 2008 financial crisis there was a lot of speculation in the market. This created a distortion in residential housing…

Overview

Build up: The recovery of the economy is mobilising the sector
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Following the boom years of 2003-08 and the subsequent downturn in the midst of the global financial crisis, the Bahraini construction sector is once again beginning to show signs of growth. The sector was first hit by the 2008 financial crisis, which was compounded later by social unrest in Bahrain. Similar to the experience of nearly every other country in the GCC region, with the exception of Kuwait, the total value of new construction projects awarded in Bahrain dropped markedly in 2012,…

Interview

OBG talks to Mohammed Khalil Alsayed, CEO, Ithmaar Development Company
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Interview:Mohammed Khalil Alsayed How competitive is project financing in the kingdom, and what do you identify as the most significant challenges in securing financing? MOHAMMED KHALIL AL SAYED: While Bahrain did not face liquidity challenges of the kind confronted by many Western markets, financiers are keen to ensure that the projects they finance show promise. The competitiveness of the project financing landscape largely depends on the nature of the project or asset being financed. In…

Interview

OBG talks to Christopher Sims, CEO, Naseej
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Interview:Christopher Sims What incentives are private developers requiring to enter into public-private partnerships (PPPs) in the affordable housing segment? CHRISTOPHER SIMS: Currently, there is little evidence of any wholesale desire by the private sector to enter the regional affordable housing market, since the financial rewards in terms of profit relative to market risks are not conducive to entry in this segment. The primary issue for private sector developers remains the small margins…

Analysis

Funds for the future: Regional resources are being aimed at social needs
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In the interests of further economic integration and development, the GCC agreed to create a $20bn fund in March 2011 to develop Oman and Bahrain. Under the plan each state is to receive some $10bn in funding as part of the Gulf Development Fund. Independent of this money, Bahrain can also count on $2.5bn from the Kuwait Fund for Arab Economic Development over the next 10 years, and $448m from the Saudi Fund for Development for schools and housing, which is all intended to benefit society. NEW…