March 2012

Alpen Capital’s GCC Construction Industry report focuses on key emerging trends, fundamental growth drivers, noteworthy challenges in the industry, and profiles of six GCC nations while presenting the outlook for residential and commercial office construction sector based on a supply-side approach.

Though the construction and real estate sector has started recovering from the lows of 2008-2009, growth is still far from pre-crisis levels. The growth is also not uniform across all regions within the GCC and while some countries are leading the recovery; others continue to take a more careful approach. Prospects in the Qatari construction market are looking optimistic on the back of strong GDP growth and the successful bid for the 2022 FIFA World Cup. In Bahrain and Saudi Arabia, the focus of the residential construction sector has shifted to providing affordable homes to the low and middle income group population. UAE’s reputation as a safe and stable country amid the recent ‘Arab Spring’ is likely to have a positive impact on the construction sector despite the current oversupply and cautious approach to new investments.

GCC region continues to enjoy premium on rental yields as compared to the mature markets of the US and Europe, which will keep the overseas investor’s interest intact in the sector. Due to low number of transactions taking place in the marketplace, the determination of the price ranges is a challenging task, thereby making this a buyer’s market. We foresee continuation of this phase in near to mid-term.

For more details please click here to access the complete version of the GCC Construction Industry Report.