Property News · February 15, 2016

Abu Dhabi's Aldar Properties keeping close eye on housing stock as prices flatline



Abu Dhabi’s Aldar Properties is monitoring the amount of real estate it puts up for sale as it tries to manage the impact of a slowdown in the sector, a company executive said on Monday.He was speaking after the developer reported a 9.1 per cent rise in fourth-quarter net attributable profit, helped by higher recurring revenue from assets such as shopping malls, schools and hotels.Economic growth in Gulf countries is slowing as low oil prices have led to spending curbs and job cuts across major sectors.
Residential prices in Abu Dhabi rose 25 per cent in 2013 and 2014 but flattened in 2015.”We’re watching how much we’re releasing into the market,” Aldar chief development officer Talal al-Dhiyebi told reporters on a conference call without giving further details.”In the last two to three months, we’ve seen a slight slowdown on demand but we are selling at a smaller rate.”Transaction volumes in Abu Dhabi were also flat, according to Matthew Green, head of research at consultancy CBRE Middle East, which could lead to deflationary pressures.
Still, Aldar would raise capital expenditure to around Dh2.5 billion this year from around Dh1.1bn in 2015, chief financial officer Greg Fewer said, as the company spend on six projects launched since 2014.Most of these projects had strong order books, including its affordable housing scheme on Reem Island which was 90 per cent sold, Mr Al Dhiyebi said.The state-linked builder of Abu Dhabi’s Formula One circuit said it made a profit attributable to equity holders of Dh735m in the three months to December 31.
Reuters had previously calculated earnings of Dh760m before the quarterly breakdown was provided.The figure was above both the earnings recorded in the corresponding period of 2014 and the Dh512.7m forecast of an analyst at SICO Bahrain.The growth was driven by income from recurring revenue assets, which contributed 62 per cent of earnings in 2015 versus 34 per cent in the previous year and would be a buffer against any slowdown in the market, Mr Fewer said.
Aldar’s shares were down 2 per cent against a 0.5 per cent dip in the wider market.business@thenational.aeFollow The National’s Business section on Twitter

Source : thenational.ae
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