Doha, Qatar: Bahrain real estate transactions totaled 5,145 in the third quarter of 2023, down slightly by 2.5% from the previous quarter. However, if we compare the year-to-date volume, we see a 5.1% increase in the first nine months of 2023 compared to the same period in 2022.
Looking at Bahrain’s housing sector, the performance of market house prices in Q3 2023 was mixed. Compared to Q3 2022, all properties increased except for apartment sales prices, which decreased by 1.7%. Apartment rents increased by 3.2%, and villa rents and sales increased by 4.3% and 1.2%, respectively. Looking at quarter-on-quarter changes, compared to Q2 2023, rental rates decreased slightly for both apartments and villas, while sales rates increased. In the mid-luxury segment, apartment rents fell 2.5% quarter-on-quarter. Meanwhile, rents for villas fell by 0.3%. In terms of sales, rates for apartments and villas increased 1.0% and 3.9% sequentially, respectively. In September, Eagle Hills completed the construction of Marassi Park, a 249-unit luxury residential development on Diyar Al Muharraq Street in Marassi Al Bahrain, which is expected to be ready for handover during the fourth quarter of 2023. Ta. This property is the fifth project to be delivered in the development. It has a land area of 25,500 square meters, has sea views and is within walking distance of both Marassi Beach and the yet-to-be-opened Marassi Galleria shopping mall.
In the office sector, supply growth has not met the necessary demand from local or international occupiers and vacancy rates remain relatively high, resulting in Grade A category for the year to Q3 2023 as a whole. The average rent has remained constant. Regionally, office rents in the UAE and Saudi Arabia have seen strong growth in the Grade A category, with an average rent increase of 11.4% across all cities surveyed in the year to Q3 2023. Ta.
Bahrain currently has one of the lowest office occupancy costs in the region. We expect the flight to quality to continue as new properties arrive in 2024 and 2025, but average rents and occupancy rates are likely to be affected. This is being driven by office occupiers of lower grade spaces, taking advantage of the affordable commercial conditions of Grade A spaces.
In the hospitality industry, key performance indicators showed improvement. According to his STR data year-on-year through September 2023, average hotel occupancy in Manama increased by 5.9% compared to the same period in 2022, and RevPAR also increased by 4.9% year-on-year. did.
Bahrain’s retail market continues to develop new inventory in both the destination mall and neighborhood plaza categories. Marassi Mall is scheduled to open in February 2024 and will feature approximately 116,000 square meters of GLA.
Heather Longden (pictured), director of advisory and transactions at CBRE in Bahrain, commented: “The third quarter of 2023 saw some gains in Bahrain’s hospitality and residential sectors. In the housing market, performance was mixed, with announced apartment sales rates declining, but only slightly compared to the previous year. However, average residential rents increased along with vacation home sales rates in each region. In Manama, occupancy in the hospitality sector increased by 5.9% compared to the same period in 2022, and RevPAR increased by 4.9%. Commercial Offices Other aspects of the market remain stable, with continued development in the retail sector with high-profile projects due for completion soon, which will further add to existing inventory.”