Real estate markets in the emirate of Sharja remain resilient says Cluttons
|Thursday, 09 May 2013|
The real estate market in Sharjah remains resilient and is one of the Emirate’s top performing sectors, according to the latest report from property firm Cluttons.
Residential apartments in popular areas have witnessed an average rental increase of 10 to 15% and in the commercial sector landlords are becoming increasingly flexible with their office leasing agreements, boosting demand.
The report says that the residential sector is witnessing a steady rise in average rents as demand outstrips supply for the first time since the global economic crisis.
Since October 2012, apartments in popular areas such as Al Majaz, Al Nahda and Qassimiya have witnessed an average rental increase of 10 to 15% and in desirable areas such as Sharghan, Al Fisht and Al Falaj, villas have seen a similar 15% increase due to strong growth in demand and a lack of quality stock.
However, Cluttons points out that these increases are applicable only to new lettings as the three year, no increase protection law still exists in Sharjah.
The office market has remained unchanged since October 2012, with average rents in the main business districts holding between AED50 to 80 per square foot. Landlords of a number of the more prominent office towers are now offering flexible lease agreements, which has helped attract tenants and increase occupancy rates.
Cluttons has noted an increasing demand for onsite amenities such as gyms, restaurants and cafes, and extensive renovation work has been undertaken on some older properties, further enhancing the desirability of Sharjah’s office market. Cluttons expects the current market trend to continue over the next six months, driven also by Sharjah’s position as a good start up location for smaller businesses.
Since October 2012, industrial rents have remained steady, but certain areas further away from the city centre, like Industrial Area 18, are seeing a notable 15% rise in rents, with warehouse rents increasing from AED17 to AED 20 per square foot.
Finally, Sharjah’s hospitality sector has also shown signs of continued growth, with a 9% year on year rise in guest numbers at hospitality establishments within Sharjah. The Emirate is proving popular with budget conscious travelers as an alternative to Dubai, with the majority of visitors from the GCC. The majority of European visitors are Russian.
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