Qatar is one of the world’s leading countries in the Middle East in real estate investments, especially after its recent acquisitions in the heart of New York.
Global investments in the real estate market made by Middle East countries reached the first half of 2016 close to 8.8 billion Euros (about 10 billion US dollars), according to the report by consulting firm CBRE Group.
It has been a meteoric growth that has exceeded all expectations, achieving the best figures since 2009. The biggest increase has been in the sovereign wealth funds (SWF’s). Thus, Qatar and the UAE, respectively, are leading these investments highly concentrated in real estate.
London is the investors’ second choice, surpassed only by New York, attracting around 4.2 billion Euros in investments. The United Kingdom is the European country with more Middle East investors. In the period 2008-2014 Europe as a whole had an average of SWFs acquisitions by the Middle Eastern countries worth 183 million Euros.
However, it is far from the figures of United States and Asian countries which are increasingly receiving greater flows of investment capital from Qatar and other Gulf countries. This trend is a reflection of investment diversification and assets policies these countries are applying.
The strong economic growth of Gulf nations, together with the low currency exchange rates, facilitate and stimulate investments. In the case of Qatar, it was by far the largest investor in the Middle East in 2014 with a total of 4,351 million Euros invested.
Thus, recently the Qataris have acquired, through the Qatar Investment Authority (QIA) 9.9% of the shares of the company owning the iconic Empire State of New York worth 552 million Euros and 44% of shares of Manhattan West, a new development district offices.
Finally, until recently Qatar and other Middle Eastern countries investment were concentrated in the hotel sector, but thanks to economic diversification processes that they are implementing, diversification of their investment is expected. In this sense, sectors such as industry and logistics appear as new investment objectives for these countries.
These capital movements could be a boost for the global economy and especially for new investment recipient countries, as well as a way to strengthen or establish new ties with Qatar and other Middle East nations.
Del Canto Chambers, with offices in Doha and London, is highly specialized in #Qatar. Please do not hesitate to contact us at email@example.com
Del Canto Chambers’ Editorial Board