Following hot on the tails of my 'Not another MIPIM post' - I ditched the rosé ( for the most part 😉) and without a navy gilet in sight headed to the Middle East. What a week (and a bit) in a part of the world, that for me at least, always provides a frank and varied perspective on the UK and European real estate markets. They are not afraid to have a healthy debate! I covered a lot of ground, some solo, but for the most part with my Taylor Wessing colleagues Ben Lister, Nick Warr and Fawaz Elmlaki… touching down in Kuwait, Riyadh, Abu Dhabi, Dubai and Doha.
Our conversations were rich and varied, covering:
- Diversification outside of the region is still a focus for investors, with the UK and US being top of the list as destinations but ( and there is always a but) there is still a pricing mismatch. Returns just aren't lighting their fire! There is also the 'Saudi Factor' where investors can see huge opportunity (and some eye watering returns) in the biggest economy in the region.
- Set up of local platforms and building a presence in key markets, including the UK, is very much on the agenda for the larger investors and private family offices.
- An increased focus on utilising the 'in region' regulatory regimes.
- Openness to alternative asset classes - it's not just Grade A offices any longer. Mayfair and West End stock is still highly sought after.
This was my first visit to Riyadh, and wow! It was truly fascinating. The speed of change and the palpable excitement from the locals about their country was so evident and they are right to be excited. They are probably one of the last big economies that are and will experience phenomenal growth. No judgement from me, but I'm sure there will be views about the "Saudi Factor" and their unproven track record, and yet global capital is not ignoring the opportunity to invest and create the promised high returns. Everywhere you look are names of global businesses with massive presence on the ground. The traffic is not great but that again is down to the numbers of people visiting, working and living in the city. There is huge investment going into the infrastructure so I have little doubt that it will improve in short order… Thankfully they haven't chosen to replicate our planning regime!
