With the Qatari government committed to increasing services and improving infrastructure in the country – it has allocated $130bn to real estate and infrastructure development over the next six years – and as the country’s construction industry continues to thrive, new opportunities are constantly appearing in the real estate market, with the residential sector, and in particular the affordable housing segment of this sector, showing promise.
This is according to Seraj Al Baker, CEO of Mazaya Qatar, a Qatar Exchange listed company and one of the leading property developers in the GCC. He says that, to date, most developers have focused on the up-market luxury segment, leaving a gap – and major opportunity – in the middle-income, affordable housing sector.
“With the scaling back in investment, and the significant demand in the affordable housing sector – compared to the largely oversupplied luxury sector – developers will likely turn their attention to the middle-income group,” he says.
While Al Baker believes that things in the Gulf region are likely to continue to move slowly, as developers focus on maintaining and managing existing projects rather than on starting new ones, Qatar’s short-term real estate outlook is promising, particularly in light of its winning bid for the 2022 football World Cup.
“Qatar’s residential real estate market is especially positive due to a stable political environment and a strong economy,” he says. “In addition, Qatar’s successful bid to host the 2022 FIFA World Cup will act as a catalyst for significant government investment into infrastructure and real estate development. This will not only enhance the real estate offer in Qatar, but will also give it a significant boost – creating employment, population growth and generating strong demand for all real estate assets over the medium term.”
Infrastructure investment glut
Qatar’s economy is expected to continue to grow at a fair pace throughout the next two years and beyond, particularly given the government’s commitment to invest more than $125bn over the next five years in energy and construction projects as part of its development strategy, and more than $35.7bn in residential and business construction projects.
“The next few years will be vitally important for the real estate sector and for real estate companies operating in Qatar, and significant joint efforts from all sectors and organisations are required to ensure success,” Al Baker says.
As a major player in the Qatari real estate sector, Mazaya Qatar believes that it can contribute considerably to the country’s growth and success, and it has developed a five year plan that covers a number of yet-to-be-announced projects, as well as projects that are already underway and projects that have been or will be completed shortly. The plan also includes a number of strategic agreements to be signed with private and government parties with the aim of serving the interests of shareholders and developing the company to the highest levels.
“Mazaya Qatar’s primary goal since inception has been to lay the foundations for sustainable success, as was apparent from our exploration of opportunities in Qatar’s real estate market,” Al Baker explains.
“It is not easy to make significant accomplishments in real estate at a time of economic fluctuation, especially when the real estate sector is the most heavily impacted sector. However, Mazaya Qatar commenced operations at an extremely difficult time, and we had no choice but to continue – to look for solid alternatives and find innovative strategies that would help us cope with the change and attract investors, building on experienced management and a prudent strategy that focused on guaranteed revenues and minimised risks.”
The company has a portfolio of important architectural and professional civil engineering projects and mega-projects in Qatar, and has made it its mission to execute and deliver these projects carefully and innovatively.
Says Al Baker: “We are committed to making a difference in real estate development, to taking it beyond mere development into a quality business that will help enhance the company’s position in the region and beyond. We are confident that this can be achieved by adopting environmentally friendly values, by operating in accordance with sustainable development principles, and by adhering to the highest international standards.”
In support of its environmental principles, Mazaya Qatar joined the list of founding members of the Qatar Green Buildings Council (QGBC), an independent non-profit organisation committed to developing a sustainable approach to the design and development of buildings in Qatar, earlier this year.
Evaluating Mazaya Qatar’s performance clearly qualifies the company for the significant role it intends to play in the market – over the past two years Mazaya Qatar has consolidated its position in the market, and has developed and boosted its advanced model. The company has also conducted comprehensive feasibility studies and drawn up a mature vision with which it expects to achieve success.
Al Baker highlights the various milestones reached by Mazaya Qatar in 2010: “We launched a successful 50 million share IPO; we officially listed on the Qatar Exchange in October; and we signed three key agreements with the Qatar Foundation for Education, Science and Community Development (Qatar Foundation) – a 10-year agreement for the construction of 350 residential units for Qatar National Convention Centre’s employees, a 20-year Build, Operate and Transfer (BOT) agreement to develop and manage approximately 1165 residential housing units for the nursing and technical staff of Sidra Medical and Research Centre’s Residential Project, and a 30-year agreement to develop and manage the Marina Mall shopping centre in Lusail, Doha on a BOT basis.”
The company also provided countless jobs for young nationals and received applications to qualify a number of contractors before project developments.
Says Al Baker: “As a Qatari company, we see it as part of our national responsibility to consider the potential of Qatari nationals, to prepare career development programmes for them, and to help them take up their role in serving the nation’s goals, working together to achieve progress and welfare.”
In recognition of its outstanding achievements, the company received the Arabian Business Awards ‘Best Vision in Real Estate Sector 2010’ award. acquisition trail
Having achieved great success in Qatar, the company is also investigating the options available for expanding into neighbouring and regional markets.
Says Al Baker: “We are always on the lookout for potential opportunities, both locally and abroad. The decision of which emerging country to invest in relies heavily on the processes and policies set by that country’s government, including licenses, incentives and other government-driven practicalities that need to be incorporated into the decision.
“Each opportunity – and each country – is evaluated on a case-by-case basis, in line with our determination to continue to offer only the best real estate services. As the GCC real estate market, and even the global real estate sector, is expected to continue to improve over the next few years, it is likely to present us with additional investment and development opportunities.
“Mazaya Qatar will be keeping a sharp eye out for opportunities that will be beneficial to our stakeholders and to the company as a whole, while remaining in line with our overall vision and mission.”