MANAMA - The chief executive of Bahrain’s Economic Development Fund has told the FT Gulf Property Conference in the capital Manama that the nation is well placed to avoid the dramatic slowdown in real estate prices seen in the West.
Shaikh Mohammed bin Essa Al-Khalifa’s keynote speech to the conference said Bahrain was likely to avoid the global correction more than any other country in the Gulf.
He said: “The major real estate developments in Bahrain have been largely backed by Islamic banks, and have not suffered, for the most part, from the credit crunch. Also, we have not been as dependent as other nations on money from outside to finance our new developments [so] we have not suffered from withdrawals that have weakened others.”
In his speech at the Gulf Hotel in Manama, Shaikh Mohammed outlined 10 underlying strengths of the Bahrain property sector:
• Depth and range of financial products and services to support property developers.
• A mature and sophisticated real estate market.
• Well established regulation that inspires confidence.
• Bahrain bank’s exposure to the property sector has been well managed to reduce undue risk.
• More than half the population is under 25 so creating a future market for residents that is not just about expats.
• Rental markets remain strong.
• Developments mainly backed by Islamic investment banks that have not suffered from the credit crunch
• Bahrain is base for business with whole of the GCC and the planned causeway to Qatar together with the existing one to Saudi Arabia mean the Kingdom is an ideal hub to locate.
• The workforce is skilled and competitively priced.
• Bahrain offers cosmopolitan lifestyle and open market environment.
“The property picture in the MENA region remains brighter, “ he said, adding that “the current financial crisis will no doubt force delays and a scaling down of some of the more ambitious real estate ventures, but overall there is every reason for optimism.”