Q2 2016 Qatar Market Report: Fall in office rents provides opportunities for tenants - Apartments and Villas For Rent In Qatar - DTZ

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August 10, 2016

Q2 2016 Qatar Market Report: Fall in office rents provides opportunities for tenants

  • In an effort to reduce the fiscal deficit, which has resulted from the fall in oil and gas prices, the government has been concentrating on a programme of fiscal consolidation, which includes redundancies throughout the public sector, and subsidy reforms. Despite signs of a recovery in oil prices, the government have recently forecasted that the fiscal deficit will continue until 2018
  • Office availability has increased throughout West Bay due to the completion of new buildings, and a fall in demand. This has resulted in a year-on-year fall in prime rents by up to 15%
  • Demand for office accommodation in Q2 was drawn almost exclusively from the private sector, with many companies looking to downsize, or relocate within Doha to take advantage of lower rents
  • The series of redundancies both in the public and private sectors has seen a significant reduction in the number of white collar workers in Qatar, and has started to impact on the demand for residential accommodation, particularly in prime areas
  • Reduced demand, combined with the completion of new buildings has seen an increase in vacancy rates. Q2 has seen evidence of softening rents and increasing incentives, most notably for prime apartments and villas in residential compounds  The hospitality sector has experienced further falls in occupancy rates in Q2. Figures released for April showed occupancy rates fall by 6.5% in a year, while revenues per available room dropped by 17.8% on the corresponding month in 2015
  • The retail sector in Qatar has experience have fall in sales of 10% to 15% over the 12 month period up to the end of Q2 2016, however the main retail malls all benefit from high occupancy rates and stable rental levels. Overall supply remains at 643,000 sq m

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Q2 2016 Qatar – Fall in office rents provides opportunities for tenants

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