Search This Blog

19 Nov 2008

Dubai Real Estate Ruled by 'Natural Selection'

In a recent real estate seminar, sponsored by World Class Group in Dubai, the keynote speaker said that the future of the real estate market will be based on Darwin's law of natural selection.

Michael J. Tolan, CEO of World Class Group was addressing representatives from over 30 real estate related companies attending the forum, 'Beating the Economic Meltdown, Wrestling Alligators in Dubai'. The seminar was attended by hedge fund managers, property developers and real estate agents.

Tolan said that Developers who will continue to use the models of the past 18 months in the market could be in for a severe correction in their performance numbers, "The trends of the market will follow Darwin's Theory of Natural Selection and the entire model of the market will transform." he said.

"Developers will take lessons from the past recessions and will innovate new packaging and offerings to comply to investor demand," Tolan Said, "More rent to own schemes, attractive and flexible in-house finance, and real estate investment trusts will emerge to lure investors back into the stormy and uncertain waters of the real estate market."

Tolan also highlighted the advent of fractional ownership and timeshare schemes which will evolve in the Dubai UAE markets to offset the oversupply of unsold inventory and attract a new class of investors and speculators.

"In the past, the lucrative Dubai real estate market has succeeded on the heals of market euphoria and innuendo, which has created an artificial hype. Vanity selling has been the main culprit," he said.

The market value today exceeds 4 trillion dollars of existing or pipeline projects, including the world tallest building and projects like the Palm Islands which feature Trump Towers, Atlantis and the new World Islands.

"Developers and agents in the future must address the fear factor that may prevent investors to plunge into the market, and good solid regulations that Dubai has now adopted will go far to overcome consumer protection issues often absent in the past."

"Real estate consumers will respond when they have a big enough incentive to do so, therefore the more flexible and innovative the offering, combined with stringent measures of safety and protection,the better the outcome for the future of prosperity in the Dubai market arena," he added. "The Dubai market is experiencing a slow down, however is dynamic, amazing and full of promise."

Companies and Markets Reports on Hedge Funds in Europe 2008 has released a report presentig views on the market for hedge fund investment based on a survey of 100 leading asset managers across Europe.

The report, which covers mass market, high net worth and institutional customer groups, forms part of a series looking at the market for alternative investments in Europe. Looking at the onshore hedge fund market in France, Germany, Italy, Spain and
the UK, the report provides forecasts to 2012, analysing legislative developments and their implications for growth in the European hedge fund market. The report also dentifies the primary client segments and appropriate marketing and distribution strategies for individual countries.

There will be strong growth in funds of hedge funds over the next year, the report states, with less demand for single hedge funds according to 65% of asset managers in Europe. Asset managers in Spain and Italy believe most strongly that the demand for funds of hedge funds will outstrip that for single hedge funds, followed by France, Germany and finally the UK.

Across the five core economies in Western Europe – France, Germany, Italy, Spain and the UK – institutional investors now dominate the market for hedge funds. On average, slightly more than two-thirds of asset managers confirmed that this group represents their biggest customer segment for hedge funds today. In Italy, mass market investors may also be put off by the price of hedge fund investment, according to 40% of asset managers there. In Spain, on the other hand, demand from mass market clients is being limited by competition from capital-protected and structured products and inadequate promotion of hedge fund products by banks and advisors.