Cityscape to witness Saudi reform impact on real estate market

Changes in government leadership, a continued plea for fees on vacant land, and new fluctuations in property values will be key topics at Cityscape Jeddah 2015 — the 6th Jeddah urban development and real estate investment event — being held at the Jeddah Centre for Forums & Events from April 5-7.
Abdullah bin Mahfouz, chairman, National Exhibitions Company, which organizes Cityscape, said: “The prevailing factors — the new government regulations and the fluctuating oil prices — that are most likely to affect the real estate market this year will be among the key issues at the annual Cityscape Jeddah.”
James Reeve, deputy chief economist at Samba Financial Group, said: “Housing is a critical issue and I think it is steadily moving up the government's list of priorities. Actually, I think the oil price downturn could be good for the housing sector. First, I think it will refocus government attention on ‘bread and butter’ issues, rather than grandiose mega projects. Allied to this, weak oil prices may give justification to introduce a tax on land that is held but not developed. This would generate revenue and more importantly unblock a significant logjam to housing development, especially around Riyadh. I know this is something the Ministry of Housing is pushing for.”
He said: “Clearly, the oil price remains front and center to Saudi Arabia's economic wellbeing. We expect a gradual recovery in prices over the medium term, but this is not guaranteed. For example, if sanctions on Iran were lifted then the market would have to absorb up to an additional 2 million bpd, which would put downward pressure on prices.”
He added: “Growth in the Chinese economy will have a strong bearing on prices of building inputs, especially steel and copper. China's economy is slowing quite rapidly, so these prices should continue to soften. A stronger dollar will also help in this regard: A strong dollar typically means weaker commodity prices. With US interest rates heading up, and Japan and the euro zone engaged in monetary easing, we should see the dollar continue to strengthen. This is good news for Saudi Arabia since it will make a lot of imported inputs cheaper.
Cityscape Jeddah consists of the Jeddah Real Estate Workshops and an exhibition that will bring together over 50 exhibitors covering 10,000 sqm of exhibition space and is expected to attract more than 10,000 attendees.
The workshops consist of two days of informative presentations, case studies and panel discussions covering a comprehensive array of topics ranging from how regulations will drive transparency, market confidence and sustainable investment by setting the standards, to trends in customer demand for residential properties, as well as examining the question whether market demands guide the Kingdom’s real estate markets to the best conclusions.
Day three of the Jeddah real estate workshops will feature a master class on scientific project appraisal and real estate analysis techniques for existing and future real estate plans.
An important presentation about why residential developers must become community developers will be delivered at the workshops by Khaled Al-Telmesani, CEO & MD, Sumou Holding Company, principal sponsor of Cityscape Jeddah 2015.
Another key presentation will be given by Riyadh Al-Thagafi, CEO of Ewaan Global Residential Company — foundation sponsor, who will talk about creating housing that can be afforded by Saudi citizens, yet can still provide a strong return on investment.
The gold sponsor of Cityscape Jeddah 2015 is the Dubai-based real estate development company Sobha Group, whose vice chairman Ajay Rajendran said: “We will be showcasing our project Sobha Hartland, located within Mohammed Bin Rashid Al Maktoum City, and just 3 km from Downtown Dubai.”