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Abu Dhabi Commercial Snapshot 2018

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Abu Dhabi Commercial Snapshot 2018

Real estate in Abu Dhabi continues to feel downward pressure across most sectors due to the lingering impact of job losses and consolidation activity witnessed during 2016/2017. With VAT being introduced across the UAE, a marginal negative impact has been felt in Abu Dhabi’s retail sector, whereas other asset classes are yet to register a shift in dynamics.

Rents are softening across the board, however , the pace is starting to decelerate with the Grade A market displaying relative resilience. With oil prices witnessing sustained upward momentum and government spending on the rise, these positive forces are driving up the overall economic sentiment. Although a clear turnaround is distant in the office and industrial sectors, we expect this deceleration to continue in the midterm, followed by a gradual increase in demand as occupiers continue to consolidate and optimise current foot-print.

Rising supply figures further amplify the weakening performance witnessed by the retail sector and create diverging performance trends between the resilient prime super regional malls and the under-performing regional & community malls.

Source : Core Savills

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