Bahrain’s real estate sector growing rapidly

Bahrain’s real estate sector is witnessing rapid expansion due to growth in demand for residential and retail development.

The Bahrain Economic Development Board (EDB)’s economic quarterly report revealed growth in the sector reached 4.5% in the first quarter of 2017, contributing over $1.7 billion to the economy.

Real estate transactions in Bahrain grew by 15.2% in the first quarter of 2017, reaching a total value of USD $770 million, an 8.1% jump compared to the same quarter in 2016.The retail and hospitality sector also witnessed rapid growth, while the hotels and restaurants sector emerged as the fastest growing sector during the first quarter of this year, recording a 12.3% year-on-year real rate of expansion.

According to statistics published by the Ministry of Housing, the number of residential applications pending allocation of units currently stands at 55,000 and is estimated to grow by 5,000 each year, and are driving the high demand for residential units in the Kingdom. Additionally, the influx of visitors to Bahrain in recent years has also contributed towards a growing demand for tourism and retail facilities. In 2016, the total number of arrivals to Bahrain increased by 6% from 2015 to 12.2 million visitors. The Kingdom welcomed 5.6 million tourists to Bahrain in the first half of the year, according to Bahrain Tourism and Exhibitions Authority (BTEA), representing a 14% increase from the first half of 2016.

Housing developments, both social and private, have increased in recent years and the Kingdom is currently witnessing more than 17 housing projects, which include some private projects. The Kingdom is also home to the Avenues Mall, a 83,700 sqm building to be opened later in the year, as well as other retail developments including Bahrain Marina and mixed-use development areas such as Bahrain Bay and Water Garden City.

Over $11 billion of mixed-use real estate projects will be showcased at the Bahrain Pavilion at Cityscape Global in Dubai. It will feature participation by the Bahrain EDB as well as the five major developers Bahrain Bay, a USD 2.5billion waterfront district; Diyar Al Muharraq, a progressive urban development including the iconic Dragon City; Durrat Al Bahrain, a hallmark island city; Canal View, canalside living at its finest in the heart of Dilmunia and Bahrain Marina, a trendy waterfront development in the heart of Manama.

Commenting on the opportunity for real estate investors in Bahrain and on the participation at Cityscape Global 2017 in Dubai, Khalid Al Rumaihi, Chief Executive of Bahrain EDB, said:
"Recent figures demonstrate the resilience of Bahrain’s real estate sector and highlight the increasing demand for housing, not only in the Kingdom but across the wider region. Strong growth in this sector has been supported by the implementation of economic and legislative reform and forward-thinking policies such as the public private partnership model by the Ministry of Housing and the recently issued Real Estate law.

"Cityscape Global is an excellent platform for developers to showcase their world-class projects to interested investors and we think Bahrain has great developments to offer and are pleased to be taking part for the third year in a row."

Bahrain has a pipeline of large-scale infrastructure projects across a wide range of sectors valued at $32 billion, which will support growth within the real estate market and help maintain robust economic growth throughout the Kingdom. In addition to developing the necessary hard infrastructure, Bahrain is implementing soft infrastructure such as smart legislation, enabling investors to realise value from their capital. A new regulation has also been developed in consultation with the private sector to specifically support growth in the Kingdom’s real estate sector.

Source:BNA