(Source: The Wall Street Journal)
Funds prowl Dubai properties – Investors’ interest after price tumble could revive market
A growing number of distressed funds looking at Dubai real estate may signal the bottom of the market and could help revive the emirate’s shattered property sector after prices dropped 50% in less than a year.
As overstretched borrowers who hoped to profit from the emirate’s six-year property boom face up to the reality of tumbling prices, high interest rates and job cuts, some are dumping unwanted real estate. Property funds are on the prowl to snap up the bargains. “This is definitely a positive for Dubai,” said Gaurav Shivpuri, head of corporate-finance advisory at real-estate consultancy Jones Lang LaSalle. “We’re starting to see investors calling the bottom and prices starting to stabilize.”
The term “distressed” usually refers to a property that has a value much lower than the accepted market rate. Dubai, the once-booming Persian Gulf emirate, needs a turnaround quickly in its real-estate industry to help spark life back to its battered economy.
Read the full article by Stefania Bianchi “Funds Prowl Dubai Properties” in the Wall Street Journal (August 12, 2009).