GCC-listed realty firms' profits increase 7.35%

The collective profits of Gulf Co-operation Council (GCC)-listed real estate companies increased by 7.35 per cent to reach $3.33 billion (Dh12.24bn) in the financial year 2009, compared with $3.1bn in 2008, according to Global Investment House.

"The GCC real estate sector has witnessed a period of rapid expansion turning it into an attractive market for investors worldwide. The sector has become the focus of many regional governments, investing billions of dollars in various projects and infrastructures. Furthermore, ease of liquidity and slack regulations have allowed real estate prices to reach record highs," the Kuwait-based investment company said in a report.

The Qatar real estate sector witnessed a 390 per cent increase last year with total profits reaching $2.65bn, making it the top gainer in the GCC.

According to Global, two out of the three real estate companies in the sector posted a healthy increase in profits in 2009 with Ezdan Real Estate Company being the top gainer. The company recorded a 539.35 per cent increase with aggregate profits amounting to $2.38bn compared with $372.41 million in 2008. The other gainer in the sector was Barwa Real Estate Company, which realised a 158.74 per cent increase in profits to $220.09m from $85.06m.

The real estate sector in Abu Dhabi reported a 70.80 per cent decline with aggregate profits amounting to $451.79m compared to $1.54bn in 2008. In Dubai, the sector posted a net loss of $38.31m compared with a net profit of $486.41m in the previous year. However, Emaar Properties said last week that operating profits rose more than two-fold to Dh760m in the first quarter of 2010, paced by robust performance of its hospitality and malls subsidiaries.

In Saudi Arabia, the real estate sector posted the smallest loss in profits. The sector declined by 13.67 per cent with aggregate profits amounting to $544.89m compared with $631.14m recorded in 2008.

Bahrain was the smallest contributor to GCC real estate sector profits as it posted a 55.15 per cent decrease with total profits amounting to $18.64m. Kuwaiti real estate sector too reported a net loss of $302.16m compared with a net loss of $143.83m in 2008.

Follow Emirates 24|7 on Google News.