A Change Is Gonna Come!                                                           10 January 2025

The country’s four major emirates posted impressive real estate results in 2024 – with 331.3k transactions valued at US$ 243.32 billion; the fifty thousand plus mortgage transactions, (excluding Ajman) totalled US$ 62.48 billion. Dubai is the obvious leader of the four emirates, with Abu Dhabi posting 25.0k sales and mortgage transactions, valued at US$ 21.61 billion, as Sharjah registered 78.6k total sales transactions, valued at US$ 9.92 billion, with 4k mortgage transactions, totalling US$ 2.59 billion. No 2024 records were available for Ajman, but the previous year saw it register 11.5k transactions, worth US$ 4.60 billion, and by the end of October, there had been some 12.7k transactions worth US$ 4.46 billion.

However, Dubai was streets ahead with another record year with 226k transactions, valued at US$ 207.28 billion. Dubai Land Department estimated that there were 180k sales transactions, totalling US$ 142.23 billion, with 35k mortgage transactions with a value of US$ 50.95 billion. However, it is to be noted that last month, property prices dipped for the first time in two years, albeit by 0.1% to US$ 510k, with the same happening all over the country.

Espace estimates that six of their top ten buyer nationalities are Western European and from that four of the countries rank among the top ten globally for national GDP; many of these new residents are in the market to buy. The consultancy noted that Dubai’s growing reputation, as a magnet for global wealth, is “reflected by the number of European buyers who are drawn by the city’s exceptional lifestyle, safety and strong returns on capital investment”. The report projects further population growth, (which is a taken), alongside new property supply in the pipeline.

The latest report by Espace points to Dubai residential real estate sales in Dubai rising by an annual 31% to US$ 63.21 billion. This was split between the primary and secondary sectors – 61.4k at US$ 34.60 billion, up 74% and 32.5k, 15% higher. The off-plan sector – driven by an increased population – up 4.66%, (170k), to 3.825 million – saw its market share 4% higher at 65%, compared to H1’s 61%.

Of twenty villa communities tracked, average prices increased in all but one of them and for apartments ten of the eleven locations, driven by high demand and reduced availability.  Another factor was the increased investment by homeowners upgrading properties.

The Springs, Jumeirah Park and Town Square registered 26%, 23% and 21% increases whilst in the luxury sector Jumeirah Golf Estates, Dubai Hills and Jumeirah Islands saw 35%, 27% and 26% rises. Meanwhile newer communities, like Al Furjan (26% higher), were a magnet for buyers looking for value after being priced out of neighbouring communities. When it comes to apartments, there have been marked increases in transaction volumes and sales prices; for example, Emaar Beachfront saw a 34% hike in transaction volume, as buildings were handed over to new owners. It is estimated that JVC was home to twenty-four new projects in 2024, with the location posting a 28% increase in transactions, and that twenty-four new projects were completed in JVC last year. In 2024, it was the top-performing location for off-plan developer sales, achieved with sales of US$ 3.0 billion from 11.2k transactions, with an average transaction value of US$ 267k. JVC ranked as the top-performing area for ready property developer sales in 2024, with a total sales volume of Dh1.2 billion from 1,183 transactions, averaging Dh1.01 million per transaction.

The quadruple HOLA whammy, of high rental prices, ongoing population growth, limited supply and affordable mortgage products, is driving those who can afford the entry costs, to move into the market. When it comes to returns, Al Barari, (for villas) and Green Community (apartments) recorded the highest RoIs at 7.39% and 8.48% respectively. When it comes to affordable property, rents were 48% higher, in some cases, with increase reported for 2-bedroom flats in Deira. Other popular areas for affordable rentals included Bur Dubai for apartments, and Damac Hills 2 and Mirdif for villas.

dubizzle rated Dubai Marina, Downtown Dubai and Palm Jumeirah as the top three leading areas for buying luxury apartments in Dubai for 2024. Dubai Marina continues to be the leading choice for buying and renting luxury apartments, as the average sales price has reached US$ 695k, while annual rent is nearing US$ 40k. In the villa sector, the standout location is Dubai Hills Estate, with a sales price of US$ 4.38 million, whilst Al Barsha is the top choice, with an average rent of US$ 119k.

Affordable areas saw the most significant rise in rental prices last year, attributable to increased demand from tenants seeking budget-friendly options due to a broader rent surge; at the same time, it provides investors with robust returns and capital appreciation. Bayut estimates that rents for affordable apartments have risen by up to 48%,, with the largest increase reported for two-bedroom flats in Deira. The more popular locations, in relation to affordability, for apartments is Bur Dubai, along with Damac Hills 2 and Mirdif for villas. In the villa market, Dubai Industrial City, International City, and Damac Hills 2 led the affordable segment, with RoIs exceeding 6.0%. Bayut’s data also indicated that the highest rental yields, in this sector for apartments were in Dubai Investments Park, Discovery Gardens and Liwan, with 2024 yields, ranging from 9.0% to 11.0%.

In the mid-tier market, Living Legends, Motor City, and Al Furjan posted RoIs above 8.7%. Mid-tier villa communities, such as JVC, Al Furjan and Jumeirah Village Triangle saw returns between 6.0% and 8.0%. Luxury villa communities including The Sustainable City, Al Barari and Tilal Al Ghaf recorded RoIs exceeding 6.0%. Luxury apartments in Al Sufouh, Green Community and Al Barari have reported rental yields between 7.0% and 9.0%. When it comes to returns, Al Barari, (for villas) and Green Community (apartments) recorded the highest RoIs at 7.39% and 8.48% respectively.

Last Tuesday, Prescott Development unveiled its latest residential masterpiece, Verano by Prescott – this is their thirteenth project exclusively presented by Golden Bridge, its sales and marketing partner. The project, located in Dubai Studio City, will comprise two hundred and fifty-eight premium apartments, including studio, one, two, and three-bedroom options. Verano by Prescott also boasts over thirty-four ultra-luxurious amenities, alongside a suite of premium services, including twenty-four-hour concierge, valet parking, and round-the-clock security. Starting prices for studios will be at US$ 177k, with flexible payment plans, including a 60/40 option; handover is slated Q3 2027.

Earlier in the month, Harish Fabiani bought the Thuraya Telecommunications Tower in Barsha, with 143k sq ft of office and retail space, for US$ 44 million and plans further capex of US$ 11 million on upgrades.  Days later, the founder of Indialnd Group, who already has a real estate portfolio in India, valued at over US$ 500 million, acquired 45k sq ft of office space at the upscale Burj Daman high-rise in DIFC, which is expected to generate over US$ 5 million in annual rentals.

The Indian landlord was positive that this sector, noting that “so, (those) rents will increase substantially over the next year, so we will not miss out on incremental rentals that the Dubai office market is witnessing, and “This demand will sustain”. He is not the only landlord with similar feelings with the likes of Aldar, who last month invested US$ 627 million buy of an under-development commercial tower in DIFC from H&H, and The Tecom Group acquiring an office cluster in Dubai Internet City for US$ 196 million, from the operator of the Emirates REIT fund.

Last year, the London-listed luxury property developer, Dar Global, unveiled ten major projects, valued in excess of US$ 1.9 billion, in locations such as Saudi Arabia, Qatar, Oman, RAK and Spain. In Dubai, it is developing a new, upscale residential community called Dar Global Villas at Jumeirah Golf Estates which it promises will redefine luxury living in Dubai, offering a selection of opulent villas.

Direct from Donald Trump’s main residence, Dubai-based property magnate and founder of Damac, Hussain Sajwani, (along with the President-elect), announced that “leveraging our expertise in real estate and data centres, we aim to deliver best-in-class infrastructure that supports the next wave of cloud and AI growth, helping further position the US in the technology and global data ecosystem,” and that. “we’re planning to invest US$ 20 billion and even more than that, if the opportunity in the market allows us.” Just days before Tuesday’s announcement, the Damac chief was seen in the company of Trump and Elon Musk. Damac owns the ME’s only Trump-branded golf course, Dubai, which opened in 2017, and has operations in over twenty countries. To date, the developer has delivered over 45k luxury units, with a further 45k in the pipeline, and has also expanded in recent years in data centres, now found in ten countries.

For the second consecutive year, it is reported that Dubai-based Sobha Realty has awarded a special US$ 41 million bonus programme to all its staff. Ravi Menon, Chairman of Sobha Group, said, “This special bonus is our way of expressing gratitude for the resilience our employees have shown, especially pushing boundaries in the past year and making a meaningful difference.” In December, the developer announced its plans to deliver its Creek Vistas Grande development ahead of schedule.

There is no doubt that the Dubai Land Department’s recently introduced smart Rental Index has given tenants a better way to negotiate a fairer rent than in the past. The index links property ratings to rental valuations, based on a five-star rating, and the use of more than sixty criteria. It also ensures that landlords upgrade older buildings before they can move rents higher; buildings in the same area will be able to charge different rents according to the condition of the structure and amenities provided. Khalid Al Shaibani, director of the Rental Affairs Department at DLD, commented that no longer will rents be arbitrary, as it now considers various factors, including the average rent in areas, infrastructure, condition of buildings, and existing rental contracts.  Basically, if a building is in good condition, it will receive a higher rating, but it does not seem to account for a well-maintained unit in an older building.

2025 is a significant year for both Jebel Ali Port, celebrating its forty-fifth anniversary and Jebel Ali Freezone its fortieth. This month, DP World reached a historic milestone, surpassing one hundred million TEUs of container handling capacity across its global portfolio since inception. Growth over the past decade has been significant, with investments totalling US$ 11.0 billion in strategic investments and infrastructure development, that has helped DP World to be a leading player in global trade. During that period, its capacity has grown 33%, driven primarily by expansions, new greenfield developments and acquisitions. Last year, its global gross container handling capacity increased by 5%, helping DP World to a 9.2% share of the global container market, with global container throughput expected to grow by 2.8% this year.

The Majid Al Futtaim Group, which owns and operates the retail brand Carrefour across multiple countries in the region, closed its operations in Oman earlier this week. By Thursday,, it announced the launch of a new grocery retail brand HyperMax in Oman, with eleven outlets in that country eleven locations. It expects that this will create 2k direct and indirect jobs in Oman, with the group saying it is “leveraging its existing asset network in Oman” for HyperMax.

Japan’s Mori Memorial Foundation’s Institute for Urban Strategies has ranked Dubai, for the second year in a row, the eighth globally – and first regionally – in their Global Power City Index 2024.  Dubai’s Crown Prince, Sheikh Hamdan bin Mohammed bin Rashid, commented “Dubai’s high ranking on global indices shows that we are not just keeping pace with the world, we are setting new benchmarks for excellence,” and that “the city’s remarkable performance in global indices has been driven by HH Sheikh Mohammed’s’ visionary leadership and the commitment of its talented people and trusted partners.”

According to Jamal Bin Saif Al Jarwan, Secretary-General of the UAE International Investors Council, the total value of overseas Emirati investments was estimated at an incredible US$ 2.5 trillion; this includes both public and private sectors and the value was at the beginning of last year. Unsurprisingly, the US and other Western countries were some of the major destinations.

There are nearly 24k drones registered in the UAE, as listed by the General Civil Aviation Authority, since the personal drone ban was recently lifted; a total of ninety-three companies have been registered and two hundred and seventy individual applications have been received to date. The GCCA clarified that the UAE Drones Unified Platform is an interactive platform designed to register and regulate drone operations, provide information on usage requirements, and ensure compliance with laws and procedures. Users have to ensure that the areas for flying are permitted and that the remote identification system is available on the UAV.

Last year, the country’s air traffic grew by 10.3% on the year, (and 20% plus over two years), with its aviation sector posting a record one million air movements, as EK 305 to Shanghai, on 22 December, took the number into seven digits. Abdulla bin Touq Al Marri, Minister of Economy and Chairman of GCAA, posted that “the UAE has implemented innovative national initiatives and strategies to enhance its competitiveness and prominence in the civil aviation and air services sector, both regionally and globally. Achieving the milestone of one million air traffic movements in a single year is not a mere numerical achievement but a reflection of the UAE’s steadfast commitment to developing the aviation sector as a cornerstone of its national economy and solidifying its position as a global air transport destination.”

Last Friday witnessed the inaugural flight for Emirates of its first ever Airbus 350, with Edinburgh being the destination. Rather belatedly, the airline expects  the delivery of a further sixty-four A350s in the coming years. The plane is being reconfigured, providing three hundred and twenty-two seats two hundred and fifty-nine, in Economy, twenty-one in Premium Economy and thirty-two in Business Class lie-flat seats. During Q1, A350s will start flying to Mumbai, Ahmedabad, Kuwait, Bahrain, Colombo, Lyon, Muscat, and Bologna.

Mashreq has divested part of its minority stake in the digital payments enabler, Neopay, to a consortium of two companies, Türkiye’s DgPays and the Bahraini alternative investment firm, Arcapita Group Holdings Limited. The Dubai-based bank confirmed that it “retains a significant minority stake in Neopay, underscoring its commitment to supporting the company’s continued growth.” Launched in March 2022, the business has processed more than four hundred million transactions and is used by over 10k merchants in the country.

The latest report by Henley & Partners places the UAE in tenth position in the world when it comes to measure the strength of its passport, along with the likes of Latvia, Lithuania and Slovenia. The UAE passport in 2025 allows nationals visa-free access and visa-on-arrival to one hundred and eighty-five countries, rising one position from last year, having risen from a fifteenth placing in 2022 and thirty-eighth in 2017. The UAE compares favourably with other Gulf nations with Qatar, Kuwait, Bahraain, Saudi Arabia and Oman ranked forty-seventh, fiftieth, fifty-eighth, fifty-eighth and fifty-ninth. The index includes one hundred and ninety-nine different passports and two hundred and twenty-seven, with six nations – different travel destinations. Singapore’s passport remains the strongest, followed by Japan, with Finland, France, Germany, Italy, South Korea and Spain coming in third.

December’s S&P Global’s PMI indicated that the UAE non-oil private sector expanded, by 1.2 to 55.4 – its fastest pace in nine months – down to strong demand and increased business activity; Dubai’s PMI also grew at its quickest since April 2024. Notably, strong demand pushed the new orders subindex higher by 1.3 to 59.3 from 58.0, but the other side of the equation sees export demand growth declining to seven-month low. The fact that backlogs continued to expand driving capacity levels remaining under considerable stress. There was no better news for recruitment which barely changed on the month, after November’s return posted a thirty-one month low; this could have impacted companies’ confidence in future business activity remained muted in December, with both factors softening margins. Input prices were also at their lowest in nine months whilst purchasing was at a thirteen-month high growth which may give a boost to help lift inventory levels., which could help to lift inventories after a subdued trend in the second half of 2024.

The DFM opened the week, on Monday 05 January, three hundred and eight points (6.4%) higher the previous three weeks, gained ninety points (1.7%), to close the trading week on 5,238 points by Friday 10 January 2025. Emaar Properties, US$ 0.06 lower the previous fortnight, gained US$ 0.09, closing on US$ 3.54 by the end of the week. DEWA, Emirates NBD, DIB and DFM started the previous week on US$ 0.78, US$ 5.61 US$ 1.91 and US$ 0.41 and closed on US$ 0.77, US$ 5.87, US$ 1.98 and US$ 0.43. On 10 January, trading was at two hundred and three million shares, with a value of US$ one hundred and forty-three million dollars, compared to two hundred and thirty-seven million shares, with a value of one hundred and forty-seven million dollars, on 03 January.

By Friday, 10 January 2025, Brent, US$ 3.65 higher (5.0%) the previous fortnight, gained US$ 3.00 (3.9%) to close on US$ 79.59. Gold, US$ 1 (.0%) lower the previous week, gained US$ 34 (1.3%) to end the week’s trading at US$ 2,687 on 10 January 2025.

To meet the increased demand for bespoke models off its luxury Rolls Royce cars, the company is planning a US$ 370 million investment to expand its Goodwood factory and global headquarters. Whether RR will continue to make cars, with combustion engines, for their overseas clientele remains to be seen, but it will continue its investment to replace its conventional cars to electric vehicles by 2030.  Last year, it saw production down 5.3%, to 5.7k cars, although revenue was higher because of the sale of more bespoke builds. It is rumoured that the price of its Ghost saloon starts at US$ 309k with its Cullinan sports utility vehicle and electric Spectre models starting at around US$ 420k. In 2023, the carmaker came under full control of German carmaker BMW  and officially opened its Goodwood site in West Sussex the same year. The firm employs some 10k in the UK, with currently more than 2.5k working on the site.

President Joe Biden is surely leaving the White House with all guns blazing and since the start of the year, he has announced a ban of new offshore oil and gas development across two hundred and fifty hectares of stretches of the Atlantic and Pacific oceans and the eastern Gulf of Mexico. However, he has left the possibility open for new oil and natural gas leasing in the central and western areas of the Gulf of Mexico, which account for around 14% of the country’s energy production.  It seems that the current incumbent has used the Outer Continental Shelf Lands Act, that gives a president wide leeway to bar drilling that would not allow President-elect Donald Trump, or other future presidents, to revoke the ban. Indeed, in 2017, the then President Trump tried unsuccessfully to overturn Arctic and Atlantic Ocean withdrawals Obama had made at the end of his presidency, but it was ruled in 2019 that the law does not give presidents the legal authority to overturn prior bans. He has also blocked the US$ 14.9 billion sale of US Steel to Japan’s Nippon Steel, citing a strategic need to protect domestic industry. Both steel companies are planning to take legal action against the government, claiming it failed to follow proper procedures during its consideration of the acquisition.

Meanwhile, Donald Trump is taking another hit against the UK government commenting that it is making “a very big mistake” in its fossil fuel policy – and should “get rid of windmills”. This comes after another US oil producer – Apache – is to pull out of the North Sea partly due to the increase in windfall tax on fossil fuel producers; in the October budget, Chancellor Rachel Reeves raised the energy price levy, (first introduced by former PM Rishi Sunak in 2022), from 25% to 38%. Even before the new government was elected, three companies, Jersey Oil and Gas, Serica Energy and Neo Energy, announced they were delaying production by a year of the Buchan oilfield.

In 2024, the five South Korean carmakers – Hyundai Motor, Kia, GM Korea, KG Mobility and Renault Korea Motors – managed to sell a record 450.2k of eco-friendly cars, driven by the popularity of hybrid models; this return was up 11.3% on the year. 88% of this total, 356.1k units, were for hybrid cars, with sales up 25% on the year, whilst sales of electric vehicles and hydrogen fuel cell vehicles declined 21.2% to 91.4k units and 36.4% to 2.8k units in 2024.

Latest figures indicate that UK sales of recorded music hit an all-time high last year, with a spend of almost US$ 3.0 billion – 8.8% higher than the previous peak posted in 2021, at the height of CD sales. 6.7 million vinyl records were sold, growing by 10.5% and generating US$ 214 million, whilst CD sales remained flat at US$ 155 million.  No surprise to see Taylor Swift’s ‘The Tortured Poets Department’ become the biggest selling album in 2024, selling 784k copies; Noah Khan’s ‘Sick Season’ was the top selling single, with the equivalent of 1.99 million sales. 85% of the revenue was taken by subscription services such as Spotify, Amazon Music and Apple Music. However, despites this recent improvement, the industry is still way off figures from 2001 when, adjusted for inflation, the industry made the equivalent of US$ 4.92 billion.

Video game sales dipped 4.2% on the year to US$ 5.66 billion, not helped by the failures of Concord, Suicide Squad and Skull & Bones. In addition, there was a marked decline in the sale of boxed physical games, whose sales fell by 35%. Yet again, the biggest selling game of the year continued to be EA Sports FC 25 – formerly known as FIFA – which sold 2.9 million copies, 80% of them in digital formats. Worryingly, only four of the games in the top ten were new releases, with half of them being updates to existing franchises. Five of the top ten games were exclusive to Nintendo Switch.

As noted in last week’s blog, the London Stock Exchange is losing business and its position as one of the world’s more important bourses is declining; recently Ashtead, the FTSE-100 equipment rental company, decided to move its primary listing to New York where there is more liquidity and better valuations available. However, there was some good news at the beginning of the year that BC Partners and Pollen Street Capital, owners of Shawbrook Group, the mid-sized British lender, (which employs 1.6k and has 550k customers), were drawing up plans for a US$ 2.50 billion IPO. It is reported that a H1 issuance could take place, and if that were to occur it would become one of the largest companies to list in London. On top of that, there is ongoing speculation on whether online fashion giant, China’s Shein, will use LSM and if it were to go public, it would become one of the biggest ever to take place in London.

Australia’s housing market is in a downturn for the first time in almost two years after the average national price of a sold property, in December, dipped 0.1% to US$ 506k.The forecast is for a property price stabilisation in 2025, with values moving slowly down. An event that has not happened for some time is the fact that the country’s biggest cities are dragging down the national average; having taken a beating last year, Melbourne is now the third cheapest capital city in the country, behind second place Adelaide and Perth. Over the year, and despite the RBA holding rates, at 4.35% – their highest level in a decade, property prices were over 5.0% higher, with apartments rising by 3.6% and 5.2% for houses. Once interest rates start to come down, confidence will inevitably return to the sector and more buyers will be able to access extra funding. With house prices in some cities having risen by as much as 70%, it is patently obvious that an increasing number of potential buyers have been priced out the market; home loan borrowing capacity has come right down amid high interest rates.

Although HCOB’s final composite Purchasing Managers’ Index posted a 1.3 increase on the month in December to 49.6, the eurozone economy ended the year in contraction territory. It appears that the headline index was impacted by a marked decline in factory activity, but this was boosted by the services sector, which posted a 1.1 hike to 51.6. This year, it seems that the latter will not suffer the consequences of any tariffs imposed by the Trump administration, unlike manufacturers which will bear the brunt of them – this will continue to drag the eurozone economy down in 2025. Despite a rise in overall prices charged, as firms tried to recoup a sharper increase in input costs, demand nudged higher to 50.2 – just above the 50.0 threshold, differentiating between contraction and expansion. Because services inflation is still too high, it is almost inevitable that any rate cuts in Q1 will remain minimal. Furthermore, without all these problems, the bloc’s economy would also be hit by political turbulence throughout the eurozone.

A recent ECB study “suggests a relatively stable labour market looking ahead,” and expects the unemployment rate – currently at a record nadir of 6.3% – to remain relatively low in 2025. It appears that the euro zone labour market’s exceptional resilience is losing strength but any downturn will be slow, as firms continue to hire; the ECB noted that employment typically expands at about 50% the rate of real GDP growth but it has actually surpassed GDP growth since 2022.

The latest S&P Composite Purchasing Managers’ Index survey confirms what most already knew – that the October budget has impacted badly on the UK economy. The report was released almost at the same time as a warning from the British Chambers of Commerce that more than half of firms were planning to raise their prices. The PMI survey indicates that last month businesses shed jobs, (across the manufacturing and services sectors), at the fastest pace since January 2021, with business confidence is at its lowest level since the Truss September 2022 mini budget market meltdown and that worries about tax stood at levels not seen since 2017. Part of Labour’s election manifesto last year was based on an improved working relationship but that largely disappeared when Rachel Reeves introduced her budget which largely relied on businesses to bankroll most of her US$ 50 billion (GBP 40 billion) tax increases. The BCC survey found 55% of companies were planning to raise their own sales costs, to cover some of the extra costs arising from a 1.2% hike in employers’ National Insurance contributions, a rise in the National Living Wage increases from April and the fact that interest rates are not going down as quickly as expected. Furthermore, companies are also having to slash investment plans.

By Wednesday, sterling had slumped to its lowest level in nine months, (at 1.233 to the greenback), because of UK government borrowing continuing to head north and borrowing costs having surged to their highest level since the 2008 GFC financial crisis. Analysts are concerned that ongoing high borrowing costs have a good chance of further tax rises or cuts to public spending because of the need of the Starmer administration trying to meet its self-imposed borrowing target. The PM’s spokesman noted “I’m obviously not going to get ahead … it’s up to the OBR (Office for Budget Responsibility) to make their forecasts.” There is every possibility of Chancellor Rachel Reeves having to change course if she is looking at spending more on public services without raising taxes again or breaking her self-imposed fiscal rules. Many would agree that A Change Is Gonna Come!