Words of Wisdom! 09 May 2025
April 2025 was a record-breaking month for Dubai’s property market, with strong performance across all sectors, particularly off-plan developments and luxury real estate. Market confidence is there for all to see, built on surging demand, The data reflects growing investor confidence, rising demand, (from both resident and international buyers) and an increasing portfolio of properties available from prices of US$ 272k and upwards.
According to Property Finder, April was another record month for Dubai’s property market, with transaction values topping US$ 16.93 billion – 94% higher, with one significant driver being the gains from higher deals involving Palm Jebel Ali villas and homes sold by Emaar at The Oasis, accounting for 19% and 13% of the total sales, although they only made up 2% and 4% of total transaction volumes in the off-plan space. Off-plan sales garnered US$ 9.31 billion – 124% higher on the year, with secondary sales posting 7.7k transactions, (66% higher on the year), valued at US$ 7.62 billion – up 67% compared to April 2024. During the month, one transaction stood out – a landmark US$ 395 million land transaction in DMCC-EZ2 for the upcoming Sobha Central development in Jebel Ali.
In April, total property sales, 55.4% higher, totalled 17.979k transactions, valued at US$ 19.73 billion. Split between apartments, villas plots and commercial/buildings transaction wise there were 13.737k, 3.223k, 600 and 420 deals, valued at US$ 7.27 billion, US$ 6.46 billion, US$ 2.97 billion and US$ 3.03 billion.
Average apartment and villa annual prices were mixed, with the former 2.4% lower at US$ 354k and the latter 2.2% higher at US$ 954k. Whilst commercial prices exploded by 58.8%, to US$ 518k, there were notable falls for plots and buildings – down 45.3% to US$ 954k and 66.8% to US$ 2.72 million. Apartment and villa rentals both headed north by 6.7% to US$ 22k and by 12.5% to US$ 49k. However, commercial units fell by 36% to almost US$ 20k.
Mortgage transactions more than doubled to 4.46k deals, although their value rose by only 15% to US$ 4.17 billion.
A fam report indicates that there was a 126% surge in volume of five hundred and ninety-nine plot sales, worth US$ 2.97 billion, a 42.3% hike in apartment sales at 13.74k, valued at US$ 7.28 billion, and a 54% annual increase in commercial property transactions, at four hundred and nineteen, worth US$ 300 million, with the average price per sq ft of US$ 431.
Over the past five years, Dubai’s property market has exploded as can be seen from a comparison of April sales. In April 2020, there were 1.7k transactions worth US$ 981 million compared to April 2025 there were Dubai property sales for the month of April have now soared by 1,633 per cent in value over the last five years – from US$ 981 million (1,700 transactions) in 2020, US$ 2.97 billion (4,800) in 2021, US$ 4.77 billion (6,900) in 2022, US$ 7.17billion (8,000) in 2023 and US$ 8.72 billion (11,600) in 2024 and last month’s new high.
With properties worth more than US$ 1.36 million, (AED 5 million) accounting for 11% of total sales, 31% came in the US$ 272k – US$ 545k, (AED 1-2 million range), 27% below US$ 272k, (AED1 million), 18% between US$ 545k – US$ 817k, (AED 2-3 million) and 14 per cent between US$ 817k – US$ 1.36 million, (AED 3-5 million).
The most expensive individual property sold in April was a luxury villa at Palm Jumeirah which fetched US$ 49 million. The most expensive apartment sold during the month went for over US$ 42 million at Bulgari Lighthouse Dubai at Island 2.
Overall, first sales from developers were significantly greater than those of resales — 67% over 33% both in terms of volume and overall value.
MGM confirmed that that the construction of the MGM Tower in Dubai is in full swing and set to be completed by Q3 2027. President and CEO, William Hornbuckle, commented in a Q1 earnings call, that “we’re literally up on the fifth floor of the MGM tower as we speak. It’s an exciting project, a truly interesting resort with all kinds of features. Hopefully we’ll get to add gaming,” Last month, the hotel and gaming operator stated that it had “a non-gaming management agreement with Wasl Hospitality to bring the Bellagio, Aria, and MGM Grand brands to Dubai”. Eight years ago, Dubai-based Wasl Hospitality and Leisure signed an agreement with MGM to advise on the development of a premier destination resort in Dubai and to operate the resort when completed. At that time, it was thought that the twenty-six-acre beachfront site would also include an MGM Hotel, MGM Residences and a Bellagio Hotel, marking the debut of the MGM and Bellagio brand names in the ME region. Last month, high ranking members of the MGM team, including Chairman Paul Salem, met Dubai’s First Deputy Ruler, Sheikh Maktoum bin Mohammed, to update the government about “opportunities that we could bring to the UAE and Dubai specifically”.
Days after Chelsea FC beat the EPL champions, Liverpool, their new shirt sponsor, Damac Properties officially launched a new residential project in Dubai Maritime City in collaboration with the English club. ‘Chelsea Residences by DAMAC’ will comprise 1.4k apartments, (one to three bedroom), housed in six towers, reaching 130 mt high. The development will incorporate a range of Chelsea-branded amenities, including a rooftop football pitch, branded fitness and wellness facilities, and a private cinema. Other features planned for the towers include an infinity pool, cryotherapy centre, yoga studio, and multiple recreational areas. The starting price is US$ 591k but no handover date was released.
According to Haider Tuaima, ValuStrat’s MD, “securing an affordable home to buy or rent is becoming more difficult in an increasingly unaffordable market.” The consultancy noted that there had been consistent annual growth in capital values across all segments, with villas and apartment rising 30.3% and 21.4%, along with rents moving higher 5.1% and 10.0%. It estimated that 27k new homes were completed last year, (which seems to be on the low side), but that around 61.6k new homes are estimated to be delivered this year, including the 12k already handed over in Q1. It also estimated that 141.4k apartments and 29.6k villas and town houses are actively under construction, with handovers promised by 2029; 24% of this number will be constructed in just three locations – Jumeirah Village Circle, (12%), Business Bay, (7%) and Jumeirah Lakes Towers, (5%).
Q1 off-plan Oqood (contract) registrations, valued at US$ 21.06 billion, declined by 8.0% on the quarter but was 37.5% higher on the year. For secondary ready homes, the quarter registered an annual 5.8% rise, to 12.4k transactions, valued at US$ 9.00 billion, but compared to Q4 2024 down 7.0%. In Q1, the real estate market registered 9.4k mortgage transactions, valued at US$ 5.72 billion, and 14.4k cash transaction, worth US$ 9.00 billion.
Interestingly, when analysing data from a decade ago, whilst most apartment communities, (with the exception of Palm Jumeirah, The Greens and Jumeirah Beach Residence), remain 8.1% lower than their capital values now than they did then, whilst villa valuations are 59.9% higher.
There is no doubt that the property market, especially over the past ten years, has benefitted from progressive government initiatives including the ten-year golden visa, residency permits for retired and remote workers, and overall growth in the UAE’s economy on diversification efforts. Q1 has witnessed consistent annual growth in capital values across all segments, with the main exception being the decline, on the quarter, in residential sales, both off-plan and ready properties, as well as a decrease in mortgage applications. Villa capital gains posted a 30.3% annual and a 6.2% return, with the most significant annual growth in Jumeirah Islands, Palm Jumeirah, Emirates Hills and The Meadows, with Mudon posting the lowest gains. Meanwhile apartment values slowed increasing 21.4% annually and 3.8% quarterly, with the highest gains in The Greens, Dubailand Residence Complex, Palm Jumeirah, Town Square and The Views. When it comes to rents, apartments, at 1.6% quarterly and 10.0% annually, fared slightly better than villa quarterly rents remaining flat and 5.1% annually.
After the success of its first Dubai project, Mr Eight Development has announced the launch of its second residential project property in Dubai – Villa del GAVI, located on Dubai Islands. The twelve-storey project comprises eighty-seven two-to-four-bedroom apartments, including three bedrooms plus maid, all with expansive floor-to-ceiling windows, open-concept living areas and private balconies. Residents will be able to utilise two infinity-edge swimming pools, a state-of-the-art Technogym fitness centre, a private residents’ clubhouse and an artfully curated lobby, showcasing furniture by Cassina, Minotti and lighting by Tom Dixon, FLOS and ZONDA. Prices for the two-, three- and four-bedroom apartments start at US$ 981k, US$ 1.74 million and US$ 2.59 million. Handover is slated for Q4 2027.
A new US$ 817 million luxury offering has been unveiled that will include the region’s first Buddha-Bar Hotel, Island. Developed in collaboration with George V Eatertainment/Buddha-Bar International, the project includes a one hundred and sixty-two-key overwater hotel, a collection of floating villas, and a dedicated Buddha-Bar Beach Honeymoon Island. Located in the Heart of Europe, (a heart-shaped archipelago that features six themed islands – St Petersburg, Sweden, Switzerland, the Floating Venice, Germany and main Europe), on Dubai’s World Islands, the aim is to capture the attention of European luxury travellers and the thriving UAE and GCC staycation demographic. The entire six-island project is being developed by the Kleindienst Group, founded by Josef Kleindienst; work started in 2016, with handover date scheduled for September 2022 but later revised to 2026. The Heart of Europe project was designed to include more than 4k keys across twenty distinct hotels and resorts. The project is aiming for completion by the end of 2027, with 52% of construction progress achieved so far. Last July, Kleindienst Group sold out the first phase of its US$ 272 million Marbella Resort Hotel, Vignette Collection by IHG Hotels. Last year, the Heart of Europe and IHG Hotels and Resorts partnered to operate Côte d’Azur Monaco Hotel under the voco brand.
DMCC has appointed Ali & Sons Contracting Company – Sole Proprietorship LLC the main construction contract for two new state-of-the-art commercial towers offering a combined 62k sq mt square metres of Grade A commercial and retail space. This will be part of the second phase of Uptown Dubai’s transformative development and will be seamlessly connected to the iconic Uptown Tower by a new link bridge.
Disney, in conjunction with Miral, is to open a theme park and resort on Yas Island in Abu Dhabi on a site where Miral already operates SeaWorld and Warner Bros World. The announcement came a week before an official visit of Donald Trump where he has already promised a series of business deals. Disney, which is not funding the operation, will be responsible for handling the design and development, while Miral will construct and operate the facility; the US company will earn royalties and service fees. A joint statement indicated that the resort will include themed accommodation, restaurants and retail outlets and “storytelling in a way that celebrates both the heritage of Disney and the futuristic and cultural essence of Abu Dhabi”.
The first Primark store in the region will open at The Avenues Mall in Kuwait in H2, after it was announced that the iconic budget store had partnered with Kuwait’s franchise operator Alshaya Group. After that, Dubai will be the next destination in the region to welcome the brand with three outlets in Dubai Mall, Mall of the Emirates and City Centre Mirdif, to open in Q1 2026. Now found in fifteen European countries and boasting sixteen stores in the US, the brand sells everything from socks to home furnishings, cosmetics, womenswear, menswear and childrenswear. John Hadden, Alshaya’s CEO, added that, “Price is the same. We’re going to do jeans at a starting price of AED 50, (US$ 13.62), and a basic t-shirt will be AED 15, (US$ 4.09).
In 2024, Dubai’s Roads and Transport Authority (RTA) posted a 16% growth in digital revenue to US$ 1.20 billion, as the total number of transactions, across digital channels, reached 679.6 million. Interestingly, issued parking tickets, through smart applications, grew to 29.973 million. Noting that the RTA will expand the growth in its digital services, from the thirty-three services already in use, its Chairman, Mattar Al Tayer, added, it aims to “lead in harnessing artificial intelligence to deliver exceptional services, develop innovative solutions, and increase residents’ and visitors’ happiness”. The RTA also installed five smart kiosks across the city to facilitate online payments and upgraded its website to include the ability to rent spaces at tram and metro stations, with 360-degree views of available locations.
The latest car to join the prestigious fleet of police vehicles is a Rolls Royce Cullinan, which has been further customised by the automotive specialist Mansory. Dubai Police have a range of cars, mainly used for PR purposes, including a Bugatti Veyron, Aston Martin One-77, Lamborghini Aventador, Ferrari FF, BMW i8, Tesla Cybertruck and a 3D-printed SWAT truck, along with numerous other supercars and high-end performance vehicles. Such vehicles will never be seen in car chases but will patrol the various tourist locations.
The region has emerged as the second fastest growing global region, with the ME aviation market projected to reach US$ 28.38 billion this year, with a 4.4% compound annual growth rate forecast through 2030. South Asia came in first with a 12.0% growth figure. Since the pre-pandemic year of 2019, annual growth has been around the 5.0% mark. Its new enhanced position has been driven by standout performances from the three UAE flagship carriers – Emirates, flydubai, Etihad and Air Arabia – and its world class infrastructure. Emirates Group, Saudia Group and Qatar Airways are the top three carriers by group position, with a combined one hundred and twenty-seven million departing seats. flynas, with a 63% annual growth, and flydubai were the two fastest growing airlines in the region, garnering a combined total of 14.4 million seats; the Saudi carrier, (which edged its Dubai peer by just 25k seats) posted a 63% capacity increase in 2024. Low-cost carriers bagged 29% of ME capacity, up from 13% in 2019, with flydubai playing a key role in this shift; the carrier serves one hundred and thirteen destinations, across fifty-three countries, focusing on underserved routes and secondary cities.
Dubai Aerospace Enterprise announced that it had completed the 100% acquisition of Nordic Aviation Capital Designated Activity Company and its consolidated subsidiaries, with the enterprise value of around US$ 2.0 billion. The Dubai-based company now has a fleet of approximately seven hundred and fifty owned, managed and committed aircraft. The owned and managed fleet, of approximately six hundred and fifty aircraft, is on lease to one hundred and sixty-one airlines in seventy-four countries. In addition, DAE has commitments to acquire approximately one hundred aircraft from Boeing, Airbus, ATR, and trading counterparties. Firoz Tarapore, Chief Executive Officer of DAE, commented, “Our fleet of six hundred and fifty owned and managed aircraft now makes us the third largest aircraft lessor globally by number of aircraft. This transaction augments our position as a global leader in aircraft leasing and enhances our ability to offer more cost-effective solutions to our current and prospective clients. This transaction also offers us the opportunity to deepen our relationship with the OEMs across a broader range of aircraft types.”
This week, HH Sheikh Mohammed bin Rashid met with the foreign trade team at the Ministry of Economy and the Comprehensive Economic Partnership Agreements (CEPA) negotiation team, in recognition of their exceptional performance. He commended the strong coordination among the entities leading the UAE’s foreign trade efforts, encouraging continued innovation to preserve the country’s leading position on the global trade map and to sustain the growth of its international trade relations. He also commented that trade has long been a foundation of great civilisations and remains a key pillar of sustainable economic growth and noted that the teams played a pivotal role in driving the UAE’s foreign trade to a historic record level in 2024, with total trade reaching AED 5.23 trillion, (US$ 142.51 billion) and a trade surplus exceeding AED 490 billion, (US$ 133.52 billion). HH Sheikh Mohammed expressed his appreciation to all those contributing to the growth of the UAE’s trade ecosystem, noting that their efforts were helping to write the success story of a nation committed to global economic leadership.
HH Sheikh Mohammed bin Rashid, Ruler of Dubai, confirmed that Artificial Intelligence will become part of the curriculum in UAE public schools as from the start of the next academic year, and added that it was a crucial step towards equipping future generations with the skills needed for an evolving world. He praised the Ministry of Education for developing the curriculum and highlighted the need of teaching young students not only the technical aspects of AI but also its ethical and societal dimensions. He emphasised that preparing children for the future requires equipping them with new capabilities that go beyond the conditions of the present.
There will be a 2.35% increase for for-profit schools starting in August for the 2025 – 2026 academic year. The index, approved by the Knowledge and Human Development Authority, is based on the annual review of audited financial statements submitted, by private schools, in collaboration with the Digital Dubai Authority. It reflects the operational costs of running a school — such as staff salaries, support services, and rental expenses — while ensuring the delivery of high-quality education. KHDA has notified all private schools in the emirate of the requirements for submitting fee adjustment requests for the upcoming academic year. All schools have to apply for a fee increase up to the approved ECI, with each application vetted by the KHDA; new (those that have less than a three-year history), are not eligible to apply. KHDA’s Shamma Al Mansouri commented that this approach reflected the government’s commitment to transparency and efficiency in education and supports the goals of the Education 33 Strategy, which aims to enhance Dubai’s position as a global hub for quality education.
Having seen fifteen new schools opening in the emirate over the past two academic years, KHDA is currently reviewing over twenty applications for new schools, scheduled to open within the next two years. Dubai is home to two hundred and twenty-seven private schools, educating 387.4k students, from one hundred and eighty-five nationalities. Over the past two years, student numbers have risen 12% and 6%. The target of Education Strategy 33 is one hundred new schools by 2033.
UAE credit card payments are projected to top US$ 154.09 billion this year, which would be 10.6% higher than the 2024 total of US$ 139.35 billion; this increase is due to several factors including the country’s progressive payment structure, rising consumer preference for digital transactions and government-led financial inclusion initiatives. GlobalData’s report, “UAE Cards and Payments: Opportunities and Risks to 2028,” expects that with a projected compound annual 9.6% growth rate, card payments will reach US$ 221.80 billion by 2029.
This week, the Central Bank released banking data for February:
money supply aggregate M1 up 1.8% US$ 267.82 billion
US$ 1.12 billion growth in currency in circulation outside banks
US$ 3.68 billion rise in monetary deposits
money supply aggregate M2 up 1.8% US$ 643.57 billion
elevated M1, and a US$ 6.81 billion rise in Quasi-Monetary Deposits.
money supply aggregate M3 up 0.8% US$ 766.59 billion growth in M2, overriding US$ 5.18 billion dip in govt deposits
monetary base up 3.1% US$ 222.51 billion
up 3.4% in currency issued up 11.4% in banks & OFCs’ current accounts & overnight deposits of banks at CBUAE
up 6.2% in monetary bills & Islamic certificates of deposit down 6.1% in reserve account
gross banks’ assets up 1.6% US$ 1,263.43 billion
banks’ deposits up 1.2% US$ 783.27billion resident deposits 0.8% US$ 715.40 billion
non-resident deposits 5.1% US$ 67.87 billion
Latest figures from Dubai Chamber of Commerce showed that there had been a 7.0% increase in the Q1 issue of Certificates of Origin, to 204k, and processed goods worth nearly US$ 268 million, under the ATA Carnet system. During the period, 18.16k new companies joined the chamber whilst there was a 75% hike, to twenty-eight, in local businesses being supported in expanding into international markets. Mediation services more than tripled, handling forty-five cases worth short of US$ 2.0 million, while networking events drew over 1.6k attendees. Exports and re-exports by chamber members reached US$ 23.43 billion, (AED 86 billion), between January and March, a 16.8% increase compared to the same period last year. Two new business councils were added in Q1 – Indonesia and Hungary.
Claiming to be the world’s most profitable airline, Emirates Group yet again posted record numbers for the year ending 31 March 2025. Revenue showed an 6% hike to US$ 39.6 billion, whilst profit before tax was US$ 6.2 billion. After accounting for the new 9% corporate tax rate, the Group’s net profit after tax came in on US$5.6 billion. The Group reported a record cash balance of US$ 14.6 billion, 1% higher on the year, whilst also posting its highest-ever EBITDA of US$11.5 billion, up 6% on the previous financial year. A dividend of US$ 1.6 billion was declared for its owners, the Investment Corporation of Dubai. Emirates Airline registered a record profit before tax of US$ 5.8 billion – 20% higher compared to the previous financial year – with record revenue, up 6% to US$ 34.9 billion. Its cash balance was 16% higher at US$13.5 billion. dnata also reported record profit before tax of US$ 430 million, an increase of 2%, with revenue, 10% higher, posting a record US$ 5.8 billion.
The latest government entity that is going public is Dubai Residential REIT, with Dubai Holding offering 12.5% of its capital, equating to 1.625 billion shares, on the Dubai Financial Market. The First Tranche is allocated 10% of the offer units, representing 162.5 million shares, with the Second Tranche being allocated 90% of the Offer Units, amounting to 1.462,500 billion units; the offering subscription period is expected to run for eight days to 20 May. A day later will see the final price offer announcement, with trading expected to start on 28 May. Dubai Residential REIT is a Shariah-compliant investment fund that manages 35.7k residential units across different key parts of Dubai and will become the region’s largest listed REIT, with a gross asset value of US$ 5.89 billion. Dividends, which are distributed in April and October, will be the higher of US$ 300 million (AED 1.10 billion) or an amount equal to 80% of profit for the period before changes in fair value of investment property for each accounting period, subject to Board approval.
Dubai Taxi Company posted Q1 revenue of US$ 160 million, (and 7.0% on like for like comparisons), driven mainly by fleet expansion across segments and the strong performance of DTC’s taxis, (up 7.0% to US$ 140 million due to increased trip numbers and an additional two hundred and fifty fully electric vehicles entering the fleet), and delivery bike operations – 110% higher on the year. 86% of the company’s fleet of 6.2k vehicles are either hybrid or electric EBITDA was down 9.0% on the year to US$ 42 million, with a healthy 26% margin, (excluding the impact of Connectech, EBITDA would have seen a 4.0% rise and a 30% margin). Reported net profit declined by 23.0% to US$ 23 million, attributable to the impact of the promotional discounts offered as part of Bolt’s launch campaign. DTC carried a cash balance of US$ 78 million, as at 31 March, including Wakala deposits. Shareholders approved a final cash dividend of US$ 33 million for H2 2024, representing US$ 0.0133 per share and 85% of net profit, in accordance with the Company’s dividend policy. The approved dividend was distributed to shareholders in April 2025.
Emaar Properties posted a 50% surge in Q1 annual revenue to US$ 2.75 billion, with earnings before interest, tax, depreciation and amortisation, 24% higher, at US$ 1.47 billion. The main drivers behind these impressive results include robust real estate demand from a series of twelve successful project launches, (including ‘The Valley’), and continued investor confidence across its diversified portfolio. Net profit came in 27% higher at US$ 1.47 billion, with property sales rising 42% to US$ 5.26 billion; sales backlog rose 62% on the year to stand at US$ 34.60 billion.
Meanwhile Emaar Development’s revenue surged 43% to US$ 1.36 billion in Q1, as net profit before tax increased by 49% to US$ 763 million, The company’s tax bill jumped 148% on the year to US$ 112 million.
The DFM General Index had a stunning April, posting the biggest monthly gain, at 4.1%, in the GCC to close at 5,307 points; in March, it had declined, but YTD is 2.9% to the good. Five of its eight sectors registered growth during the month including the financial index – up 5.9% and driven by CBD (22.8% higher) and communications – 7.9% higher, mainly attributable to du (EIT) shares rising 7.9%. However, Dubai Islamic Insurance and DIB were big monthly losers shedding 12.0% and 10.2%. On the flip side, the materials index slumped 22.7% in the month, with National Cement 22.7% lower. Trading activity rose dramatically from March’s 3.6 billion shares to 4.7 billion, with the value 13.4 – 3% higher on the month at US$ 3.49 billion. The three most actively traded shares in April were Drake & Scull, Talabat and Shuaa Capital, trading 553.7 million, 544.3 million 454.3 million shares respectively. Value-wise, the leading three were Emaar Properties, DIB and Salik which traded 3.9 billion, 1.2 billion and 1.1 billion shares.
The DFM opened the week, on Monday 05 May, four hundred and thirty-seven points higher, (8.2%), the previous four weeks, gained twenty-two points (0.4%), to close the trading week on 5,313 points, by Friday 10 May 2025. Emaar Properties, US$ 0.42 higher the previous four weeks, shed 0.1, closing on US$ 3.64 by the end of the week. DEWA, Emirates NBD, DIB and DFM started the previous week on US$ 0.73, US$ 5.64 US$ 2.08 and US$ 0.39 and closed on US$ 0.73, US$ 5.74 US$ 2.06 and US$ 0.40. On 09 May, trading was at one hundred and twenty-one million shares, with a value of US$ one hundred and sixteen million dollars, compared to one hundred and thirty-eight million shares, with a value of US$ one hundred and twenty-two million dollars on 02 May 2025.
By Friday, 09 May 2025, Brent, US$ 6.65 lower (9.8%) the previous fortnight, gained US$ 2.58 (4.2%) to close on US$ 63.82. Gold, US$ 110 (3.3%) lower the previous fortnight, gained US$ 111 (3.4%) to end the week’s trading at US$ 3,342 on 09 May.
Last Saturday, eight OPEC+ member countries agreed to a further accelerated oil output hike for June of 411k bpd; in April, the cartel had made a surprising May increase of also 411k bpd. A day earlier, the initial 411k bpd hike, along with the impact of the tariffs and the possibility of a US-Sino trade war saw Brent oil prices slump to US$ 61.29. There are reports that Saudi Arabia may be reluctant to prop up oil markets with further supply cuts and is concerned that Kazakhstan and Iraq have been producing above their OPEC+ targets. The group is cutting output by over five million bpd and many of the cuts are due to remain in place until the end of 2026.
It appears that Shell Plc is keen to acquire its UK rival BP, but that any bid will likely depend on whether BP stock, and oil prices, continues to slide; BP shares have lost almost a third of their value over the past twelve months and Brent oil has slumped by over 20% YTD to hover around the US$ 60 level. There is the likelihood that, with other energy giants interested, it may wait for another suitor to bid, or it will revert its focus on share buybacks and bolt-on acquisitions. A Shell spokesman noted that “as we have said many times before, we are sharply focused on capturing the value in Shell through continuing to focus on performance, discipline and simplification”. In recent years, the once close rivals were almost identical when it came to size, reach and global clout. Times have changed so that when it comes to market cap, Shell’s US$ 197 billion is 266% larger than that of BP. Much of BP’s fall from grace, and prolonged underperformance, came during the reign of Bernard Looney and his net-zero strategy insistence. Better late than never, under his successor as CEO, Murray Auchincloss, BP has returned to being a proper oil company.
Under a one-year transitional services agreement, Modella Capital, the new owner of WH Smith’s high street chain, as from March, has effectively been barred from launching a wave of mass store closures for at least twelve months. It was also reported that WH Smith would have the right to cancel a year-long TSA put in place with Modella Capital if it launched a company voluntary arrangement before the first anniversary of the transaction’s completion. The specialist retail and consumer investment boutique agreed to acquire its four hundred and eighty high street shops for US$ 101 million, with the intention to rebrand the chain under the name TG Jones, after it eventually takes control. Over the past nine months, Modella has acquired Hobbycraft and The Original Factory Shop and now plans to initiate CVAs for both.
The overall value of UK bakery market sales is about US$ 6.64 billion, equating to eleven million loaves being sold daily. The three biggest bakers of prepacked bread, with a combined market share of around 75% are Warburtons, (34%), Hovis (24%) and Allied (17%). Hovis employs some 2.7k, operates eight bakery sites and its own flour mill. There has been an ongoing decline in the sale of supermarket bread all this century and bread producers have been impacted by numerous factors including persistent inflation, (of late, mainly the impact of the war in Ukraine on wheat and flour prices), increased competition from speciality bread producers and shifting consumer habits to “healthier”, lower-carb bread or giving it up. If both parties agree to merge, it will be met by its biggest obstacle – the government watchdog, the Competition and Markets Authority will decide on whether a merger would be viable if two of the top three bread suppliers become one.
Novo Nordisk has cut its 2025 revenue growth forecast figures from 16% to 24% to 13% to 21%, mainly because of the inroads copycat versions have made into the market. Four years ago, the drug was introduced and since then, Wegovy and Ozempic has seen many alternatives compounded versions taking advantage of the drug’s popularity. Furthermore, US regulators seemed to have enabled them to enter the market to ease short supplies. Now the FDA has told pharmacies that by 22 May, they have to cease selling such drugs, indicating that semaglutide, which is marketed as Wegovy for weight-loss and Ozempic for diabetes, is no longer in short supply. On that news, Novo shares pushed 6.8% higher on the Copenhagen bourse.
The recent debacle of its closure probably was the straw that broke the camel’s back, as many airlines, specifically BA and Virgin Atlantic, vented their ire. According to Shai Weiss, Virgin’s supremo, London Heathrow is “the most expensive airport in the world”, and that airlines have long been unhappy with the airport’s costs and service levels. In a rare move of unity, they have now bandied together to demand reforms, including a vote on spending decisions and the opportunity to potentially run terminals.
In the fiscal year, ending 31 March, Japan’s average unemployment rate dipped 0.1% to 2.5%, aided by a labour shortage – the first improvement in two years; the number of unemployed people dropped by 30k to 1.75 million, whilst the number of those with jobs grew 370k to 67.93 million, the highest level since comparable data became available in 1953. There was a 20k decline in the number of people dismissed by employers, to 220k, with those who left their jobs voluntarily remaining flat at 750k.
Last year, education exports, (including tuition fees and spend on goods and services by students, while living in the country and accounting for 58% of the total), are Australia’s fourth-largest export. They totalled US$ 33.24 billion last year – 9.8% higher than in 2023 and up 28.6% from their pre-pandemic peak. The figure may have been greater if it were not for changes to government policies, including the tightening up of eligibility requirements and lifting visa costs. Although there was a 17% uptick in exports for higher education, English language schools and vocational education fell by 32% and 2% respectively. China remains Australia’s largest education export destination, accounting for 25% of the total, driven by a 22% uplift in 2024; Vietnam posted a 37% hike in 2024.
Arada has acquired the New South Wales arm of Roberts Co., a Tier-1 construction firm with a track record of delivering projects in multiple sectors. Part of the deal sees the Sharjah-based developer investing US$ 12 million to immediately recapitalise Roberts Co (NSW), securing one hundred and twenty direct jobs and providing ‘stability’ to a further six hundred in Sydney’s construction sector. It is also ‘prepared’ to invest up to US$ 64 million on ‘Roberts Co’s expansion into new sectors and geographies, with the goal of building a global presence and targeting annual revenues of US$ 627 million by 2028’. Only last year, Arada, with its CEO, Ahmed Alkhoshaibi, in its first overseas foray, had laid plans to create more than 2k homes in Sydney. He noted that Roberts will ‘help us to deliver our future projects in Australia with greater control and cost efficiencies – as well as reduced risk’, said Ahmed Alkhoshaibi, Group CEO of Arada. During the transition, key Roberts Co senior staff – that includes executive chairman, George Kostas, the previous CEO of Majid Al Futtaim – will remain in situ.
Australian house prices trended higher last month, as indicated by Cotality’s Home Value, with more of the same in the coming months because of lower interest rates and the continuing tight supply in inventory. The index posted a 0.3% monthly rise – its third straight month of positivity – as the national median value of an Australian dwelling reached US$ 532.8k. Sydney and Melbourne posted the smallest monthly rises at 0.2%, with Hobart and Darwin at the top, with increases of 1.1% and 0.9%; the other four cities, including Brisbane, Perth and Canberra had 0.4% rises and Adelaide 0.3%. The eight capital cites recorded the following percentage annual median increases:
| Median Value | |||
| %age | US$ – ‘000 | ||
| Sydney | 0.9% | 771.2 | |
| Melbourne | -2.2% | 507.5 | |
| Brisbane | 7.8% | 586.1 | |
| Adelaide | 9.8% | 533.1 | |
| Perth | 10.0% | 521.1 | |
| Hobart | 0.5% | 428.9 | |
| Darwin | 2.5% | 339.8 | |
| Canberra | -0.6% | 558 | |
| Combined Capitals | 2.6% | 584.7 | |
| Combined Regionals | 5.3% | 436.6 |
| On Wednesday, and indeed widely expected, the US Federal Reserve held its interest rates on the basis that they want to see a clearer indicator of the US economy; this was the fourth consecutive month that rates have remained unchanged at between 4.25% to 4.50%. Last September, before the Fed cut rates by 50 bp to 4.75% to 5.0%, followed by two successive monthly cuts of 0.25%. In what turned out to be a much closer vote than expected, the monetary policy committee voted 5-4 to cut rates by 0.25% to 4.25% – the fourth time this has occurred since August 2024. Rates are now at a two-year low, with the BoE warning of lower growth, amid fierce global trade tensions. Two members had voted for a 0.5% reduction whilst two more members wanted to keep them unchanged. Governor Andrew Bailey had the casting vote and went for a 0.25% cut. So much for analysts’ viewpoint with the consensus pointing to an 8-1 0.25% reduction. For the fourth consecutive month, the latest S&P Global construction purchasing managers’ index nudged 0.2 higher to 46.6, still well in negative territory, (any reading below 50 points to contraction). Housebuilding showed a degree of resilience, with activity contracting bythe least so far this year. Because new work slowed, civil engineering remained the weakest-performing area of construction activity, whilst commercial construction fell at the fastest pace since May 2020, attributable to business uncertainty and concerns about the UK economic outlook weighing on client demand. |
After three years of stop-start negotiations, the UK and India have struck an “ambitious” trade deal that will see Indian tariffs cut on cosmetics and medical devices, and will deliver a US$ 6.41 billion boost to the UK GDP, as well as increase in bilateral trade by US$ 34.06 billion; it will also slash tariffs on products such as whisky and gin. However, the not-so good news was the addition of a “double contribution convention”, where Indian workers who are transferred to the UK – and their employers – do not have to pay national insurance for three years, but they will pay social security taxes in India. The fact that NI employers’ contribution rose 1.2% to 15.0% only last month, along with the rise in the minimum wage, makes this move more galling not only to UK taxpayers but also to senior members of the governing Labour Party. When Trade Minister Douglas Alexander was asked, “Is it a pretty big incentive for these companies to employ Indian workers over British workers”?, he replied “No, because these are Indian workers living and working in India who are really coming in for a temporary period, it’s not a permanent arrangement.” Even the Indian government noted that the NIC exemption was a “huge win” and was an “unprecedented achievement”. It added that “this will make Indian service providers significantly more competitive in the UK”. The Starmer government has yet to confirm how many Indian workers and firms would benefit from the change or how much it would cost the Treasury in lost revenue.
Initially, 90% of tariffs will be reduced, and after a decade 85% of them will be tariff-free. Whiskey and gin will see levies halved by half to 75% dipping 5% a year to 40% by 2034; automotive tariffs will go from more than 100% to 10% under a quota. Indian consumers will benefit from lower tariffs on cosmetics, aerospace, lamb, medical devices, salmon, electrical machinery, soft drinks, chocolate and biscuits; UK shoppers will see cheaper prices and more choice on products including clothes, footwear, and food products, including frozen prawns. It seems that under the agreement, 99% of Indian exports will have zero duty. The UK has agreed to lower tariffs on Indian textiles and apparel – a big employer in India, and it will also make it easier for Indian professionals to come to the UK, something the Indians have been pushing hard on. However, it has not lowered tariffs on milled rice, out of fear it could decimate native industries whilst India had done likewise for dairy.
Better news for the Starmer government came yesterday with the announcement that the US had agreed to reduce tariffs from 25% to 10% on 100k UK vehicles a year. It will also permit some steel and aluminium into the country tariff-free, but most of the other imports will be captured by the 10% levy set by Trump for most of his country’s imports on ‘Liberation Day’. Both countries also each agreed to allow the import of up to 13k metric tonnes of beef from the other country without tariffs – a major gain for the US which had previously faced 20% duties and were capped at 1k metric tonnes. Overall, the US said the deal would create a US$ 5.0 billion “opportunity” for exports, including US$ 700 million in ethanol and US$ 250 million in other agricultural products.
Although Keir Starmer described the agreement as a “fantastic platform”, actually no formal deal was signed, and the announcements were feather light on details. No surprise that the Tory leader, Kemi Badenoch, criticised the deal, saying it amounted to tariffs being lowered by the UK, while being hiked in the US. And that “this is not a historic deal with the US, we’ve been shafted.”
On Saturday, Warren Buffett announced his retirement as chief executive of Berkshire Hathaway, the Omaha company he founded sixty years ago. The ninety-four-year-old, who built a US$ 1.16 trillion investment conglomerate, from a failing textile manufacturer, confirmed that his position would be taken by Greg Abel, the vice-chairman. True to form and custom, he had regaled the shareholders at the sixtieth AGM, ending by offering this advice – “You really want to work at something you enjoy,” and “if you find people who are wonderful to work with, that’s the place to go”. Perhaps the ‘Sage of Omaha’s last Words of Wisdom!
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