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THE GLOBAL PERSPECTIVE ON PRIME PROPERTY AND INVESTMENT
MIDDLE EAST SUPPLEMENT
2019
THE WEALTH REPORT Region Supplement
2 | KNIGHTFRANK.COM
Welcome note A glimpse of data
Relative value Future gazing
Prime price changes
Risk & reward
The Wealth Report provides the global perspective on prime property and investment.
We share our unique annual round-up of the winners and losers in the world of luxury residential property and Knight Frank’s outlook for key global centres.
How many square metres of prime property does US$1m* buy in key cities? Knight Frank’s prime residential forecast 2019
Whether it is at a local, regional or international level predicting what the next 12 months have in store for our clients has proved
to be an interesting process.
The multitude of global, political and economic concerns we faced a year ago, are far from being resolved, some have increased in stature and become more complex.
Nevertheless, I am optimistic about the year ahead. There may be challenges, but there will also be considerable opportunities for our clients as markets flex. In this year’s edition of The Wealth Report we highlight residential and commercial markets across the world that offer opportunities and options for those looking to invest in property.
To complement the global edition of the Wealth Report Knight Frank has designed this supplement to provide a localised summary of trends which we feel will be of interest to our clients.
As our client base of UHNWIs and family offices continues to grow, our focus on service becomes even greater as we aim to provide market-leading advice and insight backed up by a totally customer-centric approach. Being privately owned and agile allows us to put our clients first, especially at those challenging times when they need us most.
I do hope you enjoy the Wealth Report. As always, my partners and I are keen to support and guide you.
JAMES LEWISMiddle East Regional Head
3 | KNIGHTFRANK.COM
AT A GLANCE The global UHNWI
population is forecast to grow by 22% over the next five years
1.3%15%
US$ 1M
16Monaco
31New York
31London
143Dubai
the average increase in value of the
top 100 luxury residential markets
Average growth rate forecast of UHNWI
population in these selected GCC cities.
buys you the following
square metres of
prime property in
Data as of 10 December 2018 Source: Knight Frank Middle East Wealth Intelligence
Source: Knight Frank Research, Douglas Elliman, Ken Corporation
Source: Knight Frank Research*Exchange rates calculated at 31 December 2018
HUNTING HIGH AND LOWMiddle Eastern wealth currently seeking new property investment opportunities (US$)
K n ig ht Fra n k M idd le Ea st ’s Wea lt h I n t e l l i g e n c e t e a m h a s m a p p e d t h e requirements of private wealthy investors in the Middle East.
At the end of 2018, there was an estimated US $6. 2 bi l l ion look ing to be inve sted into commercial property alone, with a significant amount targeting the UK. London remains the top target, followed by other European cities, such as Berlin. This is driven by stability, transparency, liquidity, attractive returns and cost of debt.
In terms of sectors, office and hospitality rema in prefer red seg ment s. However, following global trends and opportunities, there is an increasing enthusiasm and consideration for more specialist sectors, such as healthcare, education and the private rented sector.
UHNWI GROWTH IN SELECTED GCC CITIES
ABU DHABI, UAE
192 223
DUBAI, UAE
440 511
16% 16%RIYADH, KSA
622 709
14%
UHNWIS 2018
UHNWIS 2023
% change, 2018-2023
JEDDAH, KSA
148 168
14%
BAHRAIN0.4bn
SAUDI ARABIA1.9bn
KUWAIT0.1bn
OMAN0.2bn
QATAR0.8bn
LONDON3.3bn
UK REGIONAL1.0bn
EUROPE1.3bn
US0.6bn
UAE2.8bn
Source: Global Data Wealth Insight
UHNWI GROWTH BY REGION
-4.4%London
11.1%Manila
10.5%Berlin
8.1%Madrid
5.3%Paris
9.1%Singapore
0.1%Shanghai
5.0%Los Angeles
3.1%Sydney
2.2%Melbourne
1.8%Hong Kong
-2.5%New York
-10.4%Istanbul
-11.5%Vancouver
-3.4%Dubai
MONACO
HONG KONG
NEW YORK
LONDON
SINGAPORE
LOS ANGELES
GENEVA
PARIS
SYDNEY
SHANGHAI
BEIJING
TOKYO
BERLIN
MIAMI
MELBOURNE
MUMBAI
ISTANBUL
DUBAI
CAPE TOWN
SÃO PAULO
16
22
31
31
36
39
41
46
52
57
67
67
73
93
97
100
109
143
177
200
SIZE(SQ M)CITY
#1MADRID
6%
#11MELBOURNE
1%
#2BERLIN
6%
#12LONDON
1%
#3PARIS6%
#13AUCKLAND
1%
#4CAPE TOWN
6%
#14SINGAPORE
0%
#5MIAMI
5%
#15NEW YORK0%
#6MONACO
4%
#16DUBAI-2%
#7VANCOUVER
3%
#17SHANGHAI
-3%
#8SYDNEY
2%
#18MUMBAI
-5%
#9LOS ANGELES
2%
#19BUENOS AIRES-5%
#10GENEVA
1%
#20HONG KONG-10%
HEAD OF RESIDENTIAL - MENA Maria Morris
Partner+971 56 4542 983
KINGDOM OF SAUDI ARABIA Stefan Burch, MRICS
Partner +966 112 890 776
Saud Sulaymani +966 112 890 779
VALUATION & ADVISORY Stephen Flanagan, MRICS
Partner +971 50 8133 402
HOSPITALITY & LEISURE Ali Manzoor
Partner +971 56 4202 314
HEALTHCARE & EDUCATION Shehzad Jamal
Partner +971 56 4101 298
CAPITAL MARKETS Joseph Morris, MRICS
Partner +971 50 5036 351
RESEARCH
Raya Majdalani
Research Manager
+971 56 4206 735
Taimur Khan
Research Manager
+971 56 4202 312
HEAD OF MIDDLE EAST MARKETING
Nicola Milton
+971 56 6116 368
Local Contacts
4 | KNIGHTFRANK.COM
Important notice Urban Futures (© Knight Frank LLP 2018) is produced for general interest only; it is not definitive and is not intended to give advice. It must not be relied upon in any way. Although we believe that high standards have been used in the preparation of the information, analysis and views presented in Urban Futures, no responsibility or liability whatsoever can be accepted by Knight Frank for the contents. We make no express or implied warranty or guarantee of the accuracy of any of the contents. As far as applicable laws allow, we do not accept responsibility for errors, inaccuracies or omissions, nor for loss or damage that may result directly or indirectly from reliance on or use of its contents. Urban Futures does not necessarily reflect the view of Knight Frank in any respect. Information may have been provided by others without verification. Readers should not take or omit to take any action as a result of information in Urban Futures. Reproduction of this report in whole or in part is not permitted without the prior written approval of Knight Frank LLP. In preparing Urban Futures, Knight Frank does not imply or establish any client, advisory, financial or professional relationship. Through Urban Futures, neither Knight Frank nor any other person is providing advisory, financial or other services. In particular, Knight Frank LLP is not authorised by the Financial Services Authority to undertake regulated activities (other than limited insurance intermediation activity in connection with property management). Knight Frank LLP also trades as Knight Frank. Knight Frank LLP is a limited liability partnership registered in England with registered number OC305934. Our registered office is 55 Baker Street, London, W1U 8AN, where you may look at a list of members’ names. Urban Futures is compiled from information contributed by various sources including Knight Frank LLP, its direct UK subsidiaries and a network of separate and independent overseas entities or practices offering property services Together these are generally known as “the Knight Frank global network”. Each entity or practice in the Knight Frank global network is a distinct and separate legal entity. Its ownership and management is distinct from that of any other entity or practice, whether operating under the name Knight Frank or otherwise. In any event, no entity or practice operating under the name Knight Frank (including Knight Frank LLP) is liable for the acts or omissions of any other entity or practice. Nor does it act as an agent for or have any authority (whether actual, apparent, implied or otherwise) to represent, bind or oblige in any way any other entity or practice that operates under the name Knight Frank (including Knight Frank LLP). Where applicable, references to Knight Frank include the Knight Frank global network.
MIDDLE EAST GLOBAL AVERAGE
1 UK US
2 US UK
3 France Australia
4 UAE Spain
5 Switzerland Canada
House hunters
Attitudes
27%
13%
74%
of Middle Eastern UHNWIs are planning to buy a new home outside of their country of residence
of Middle Eastern UHNWIs are planning to buy a new home in their country of residence
of Middle Eastern UHNWIs own second homes outside their country of residence, the highest proportion in the world
% of UHNWIs planning to buy a new home in 2019
In which countries or territories are those planning a purchase most likely to buy?
Source: Knight Frank Research Source: The Wealth Report Attitudes Survey 2019
IN COUNTRY OF RESIDENCE
AFRICA
ASIA
AUSTRALASIA
17%
26%
15%
15%
23%
13%
14%
16% 23%
18% 22%
11%
27%
56%
21%
4%
25%
11%
EUROPE
LATIN AMERICA
MIDDLE EAST
NORTH AMERICA
RUSSIA & CIS
GLOBAL AVERAGE
OUTSIDE COUNTRY OF RESIDENCE
HOME FROM HOMEProportion of UHNWIs owning second homes outside their country of residence
74%
65%
49%46%
35%35%
17%15%
MIDDLE EASTLATIN AMERICA
EUROPERUSSIA & CIS
NORTH AMERICAASIA
AFRICAAUSTRALASIA
