Residential rent and sales values in Abu Dhabi posted slower declines in the third quarter of 2019 while office rental values registered a slight increase, according to property consultancy firm ValuStrat.
The decline in rental values for residential properties averaged 9.2 percent Year-on-Year (YoY) while for capital values, it was 12.6 percent, the consultancy said in its Abu Dhabi Real Estate Market third Quarter report.
On a Quarter on Quarter (QoQ) basis, the decline in residential rental and capital values averaged 2.4 percent.
With residential rents declining at a slower rate than capital values, residential yields have improved with annual returns averaging at 7.7 percent for apartment and 6.6 percent for villas, ValuStrat’s analysis showed.
Within the residential segment, apartments rental and sales prices were relatively stable with marginal dips of 0.3 percent and 0.8 percent on QoQ basis; villa rents and sales prices showed a steeper decline QoQ averaging 5.4 percent and 7.4 percent, respectively.
The report also noted that residential capital values registered a slower rate of decline in Q3 than in the past four quarters. The weighted average value in the third quarter for apartments stood at 10,044 UAE dirhams ($2,735) per sqm while for villas, it was 7,083 dirhams per sqm.
Office rental rates in primary commercial districts bucked the trend QoQ with 2.8 percent increase but fell in line with the general trend with 11.6 percent decline YoY.
Office asking sales price was down 3.9 percent on QoQ basis.
Abu Dhabi main island commanded lease rates which averaged at 850 dirhams per sqm while average office rents in Al Reem Island stood at 786 dirhams per sqm.
The report also noted that average occupancy among buildings within the city’s central business districts stood at 79 percent.
Regarding industrial property, the report pointed out that prices remained relatively stable on a quarterly basis, with some new built facilities with modern specifications commanding higher pricing.
“Quarterly rental rates remained relatively stable with marginal higher asking rentals observed for newly built modern specification facilities in Mussafah industrial areas,” the report said.
(Reporting by Anoop Menon; editing by Mily Chakrabarty)
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