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Real Estate Online - Project Brief


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Real Estate Online solution is to provide all kinds of solutions for those who are looking to rent and buy properties. Every year population growth is almost 3.5%. Every year nationals needs 12000 housing units and expat needs more numbers. This is very big opportunity and there is no centralised solution available.

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Real Estate Online - Project Brief

  1. 1. 1
  2. 2. • The potential business is setting up of Real e Estate Brokerage Firm • The target market for which is Kuwaiti Nationals specially within rental business • High net worth Expatriate Individuals and Families 2
  3. 3. Basis of Business • At present in the Kuwaiti market there are no specialized services catering to the needs of the young Kuwaiti looking for their first apartment • Offering to other clients who are:  High end expatriate coming to Kuwait  All other Kuwaiti professionals  Expatriate professionals 3
  4. 4. • The very basic fundamental for the real estate brokerage business will be provide • Live in experience to the clients where in they feel it as one of their owned apartment • Providing apartments with customized solutions as the need of the customers 4
  5. 5. • Offering real estate services over the internet and telecommunication • This can achieved by using a variety of search engine tie-ups with international partners in web based real estate services • The web services will include:  Locating residential, investment and commercial properties in the region either it is for sale or rental  Requirement being number of bedrooms and rest room  Type of building – house, row house, duplex, apartment, special purpose, residential commercial mix  Ownership title – freehold, condo/ strata/ timeshare / fractional, leasehold • Standard Legal real estate contracts • Connecting with the sellers and buyers interface • Map wise location search and images of the property to be rented of purchased 5
  6. 6. • Kuwait is a small, rich, relatively open economy with self-reported crude oil reserves of about 104 billion barrels - 8% of world reserves • Petroleum accounts for nearly half of GDP, 95% of export revenues, and 80% of government income • Kuwait experienced rapid economic growth over the last several years on the back of high oil prices and in 2008 posted its tenth consecutive budget surplus • The drop in oil prices in late 2008 has reduced Kuwait's fiscal surplus in 2009. The global financial crisis may slow the pace of investment and development projects, but Kuwait has vowed to use its considerable financial resources to stabilize the economy Economic Overview 6
  7. 7. • Driving this expansion is the growing young local population and a significant influx of expatriates as a result of increased corporate activity • The sector is also benefiting from the robust economic growth and high per capita disposable income. Ample liquidity has resulted in significant investment in the sector as well • Changes in laws relating to construction of commercial properties have resulted in a slew of ongoing projects • Residential township projects worth KD 49.5 billion and infrastructure projects worth KD 11.6 billion are expected to be completed with in next 5 years 7
  8. 8. Project Value(KWD mn) 1. Silk City 25,000 2. Railroad System 4,000 3. College City in Shadadiya 1,597 4. Boubyan Island Development 1,500 5. Northern Gas Turbine Station 1,430 6. Jaber Al-Ahmed Bridge 1,036 7. Mutlaa Residential City 890 8. Boubyan Port Development 872 9. Khiran Residential City 424 10. Kuwait International Airport 329
  9. 9. • Kuwait is one of the world's top producers and net exporters of oil. • Kuwait holds the world's sixth largest oil reserves and is one of the top ten global producers and exporters of total petroleum liquids. • Kuwait Petroleum Corporation, Kuwait's national oil company, and its subsidiaries control the entire oil sector from upstream to downstream and exports. • Kuwait has implemented enhanced oil recovery measures to boost stagnant production rates. New discoveries have been made, but Kuwait's regulated oil sector hinders further exploration and production. • In an otherwise nationalized oil sector, Project Kuwait attempts to incentivize foreign investment to bring production capacity to 4 million bbl/d by 2020. • Territorial dispute between Kuwait and Saudi Arabia led to the creation of the Partitioned Neutral Zone. Both countries divide equally the production of oil and gas in the zone.
  10. 10. • Kuwait's domestic consumption has been increasing, but a majority of its production heads to Asia. • Kuwait has recently become a net importer of natural gas, leading the country to focus more on natural gas exploration and development for domestic consumption. • Kuwait's gas sector is also managed by the Kuwait Petroleum Corporation. • Kuwait plans to increase gas production to 4 billion cubic feet per day by 2030 in efforts to satisfy domestic consumption and decrease imports of LNG. • Kuwait's electric sector capacity has been extremely slow to expand despite rapidly rising consumption rates over the past decade and persistent power shortages during peak demand periods. • Facing rising electricity demand, the Gulf Cooperation Council, comprised of six Gulf countries, is developing an interconnected power grid.
  11. 11. • With a population of just 3.8m, the Kuwaiti market is relatively small in global terms. However, abundant oil wealth means that Kuwaiti nationals, who comprise about 1.1m or one-third of the population, tend to be comparatively wealthy, enjoying comfortable salaries and pensions. At an estimated US$45,900 in 2014.
  12. 12. Oil and Gas – Kuwait's Shinning Sector with more 100 Billion KD Projects in Next 5 Years
  13. 13. Kuwait – The Future of Middle East. Opportunities Unlimited
  14. 14. Kuwait Demographics Total Male Female 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 - Kuwaiti 1,242,499 610,545 631,954 Non Kuwaiti 2,722,645 1,772,413 950,232 Total 3,965,144 2,382,958 1,582,186 zia@milestonevision.(Estimates as of Decc o2m008 est.) 14
  15. 15. Marriages • Marriages occurred of Kuwaiti nationals: 11,395 • Most of the Kuwaiti couples upon there marriage seek new residential location for there future settlement as well • Expats marriages in the Kuwait are also substantial in number • Most of the people getting married seek new residential accommodation after marriage • New marriage are likely to increase every year and the requirement will be increasing too as well 15
  16. 16. 253,800 232,579 260,000 255,000 250,000 245,000 240,000 235,000 230,000 225,000 220,000 Families Kuwaiti Non Kuwaiti Families 16
  17. 17. Government Sector Employment Total Male Femal e 250,000 200,000 150,000 100,000 50,000 - Kuwaiti 229,161 104,855 124,306 Non Kuwaiti 84,328 50,705 33,623 Private Sector Employment Total Male Fema le 1,800,000 1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 - Kuwaiti 61,890 28,611 33,279 Non Kuwaiti 1,159,98 1,065,18 94,804 Total 1,535,36 1,249,35 286,012
  18. 18. • The Kuwaiti government expenditure is likely to propel domestic demand as a whole, which will percolate down to the various economic sectors, and in turn, will contribute to a higher GDP. Taking this in account, we actually observe something very different while analyzing the trend of government expenditure as percentage of nominal GDP. • The Kuwaiti real Estate Sector comprises of 3 specific segments  Residential segment  Investment segment  Commercial segment 18
  19. 19. Residential segment • This segment is comprised primarily of houses, a significant number of which is supposed to be allocated under the national housing scheme. This being preferred form of housing for Kuwaitis, it is the most important segment in terms of the housing requirements of Kuwaiti nationals Investment Segment • The investment segment is comprised primarily of land purchases and the construction of residential apartments for rent. The investment segment is important due to Kuwaiti’s significant expatriate population. Since the segment of population cannot, by law, buy properties, all the housing needs of this section of society are fulfilled by the investment property segment. Construction usually takes the form of high rise apartment buildings and differ from the residential segment in that the end user is a tenant and not an owner, the prime investment areas in urban Kuwait are Salmiya, Hawally and Jabariya 19
  20. 20. Commercial Segment • It is involved with construction of commercial complexes and sale or rent of spaces in commercial complexes for office and retail establishments, parking space • Commercial spaces provide yielding high rental rates and property price appreciation. The main commercial areas in Kuwait are Kuwait City, Sharq, Farwaniya, Hawally and parts of Salmiya • Law governing high rise construction in Kuwait have changed significantly over the years. At present government allowed 100 floor construction 20
  21. 21. 31% 7% 62% Residential Investment Commercial m 21
  22. 22. • The growth in residential homes registered with the public authority for civil information grew by a modest 1.8% in June 2007, to 133,832, compared to 131,504 one year before. however, the growth in apartment units was healthy, at 6.9%, reaching 232,668 in June 2007, compared to 217,648 in June 2006. houses and apartments grew at a five-year CAGR of 2% and 5.7%, respectively • Worth mentioning is the fact that vacancy rates for both houses and apartments decreased marginally, to 16.8% and 36.8%, respectively, in June 2007, compared to 17.9% and 37% in June 2006 22
  23. 23. • There is a gap between the requests submitted and distributed units has decreased, but it is still quite large. this depicts to us that there is a large number of Kuwaiti’s who will be seeking the real estate services for their houses 23
  24. 24. • Rental rates for residential properties have gone up steadily, from KD1.49 per sq.m in 2001 to KD 2.01 per sq.m in 2006 • Prices have escalated to an all time high of KD 298 per sq.m in 2006. prices have more than doubled in the last 12 years, from KD 148 per sq.m in 1995 to the current levels 24 Residential Properties
  25. 25. • Township and housing projects worth KD 49.5 billion are expected to be completed in the near future 25
  26. 26. Kuwaiti Clientele Market • Kuwaiti nationals have specific needs to their first and long term houses these needs varies from different criteria like: • Locality  Kuwaiti nationals prefer to be located in a existing Kuwaiti locality (society) the location of these some well known sites are Salwa, Rumaithiya, Bayan, Mishref, Faiha, Kaifan etc. • Access to market  People prefer to have their houses close to the market where they can buy their daily necessities items for the family • Near to office / work place • Nearness to school for child education • Nearness to utility services site 26
  27. 27. • Expat customers have needs based on following aspect • Sufficient space for each member • Closeness to office/ work space • Locality near by where friends are residing • Close to community gathering and centres • Nearness to cross cultural access of community • Circles where children and family member can get to gather and be close to educational institutes • Availability of parking space • Privacy for family • Good neighbourhood • Access to Medical / Health centres 27
  28. 28. • Providing of specialized customised needs in the real estate sector • Offering real estate requirement as per clients need i.e. size of rooms, number of rooms • Location based requirement of client as sea view, nearness to education / training centre / work location / community • Furnished and unfurnished apartment • Short term and long term stay requirements • Price consideration 28
  29. 29. • Phase II  Introducing web enabled services for Kuwait Market • Phase III  Entering the other GCC states  Along with Web Enabled services • Phase IV  Entering developing economies like India and the Far East, MENA 29
  30. 30. • Introduction of web enabled services in the Kuwaiti Market • Providing faster and customised search of requested property in desired location • The service will provide map based search and type of apartment categories • Faster access to clients and easy to understand their requirement leading to repeatedly improve services • Track rent received, tenant information, and leases • Professional categorized property listing • Multi-images viewing in the results page • An option to add to favorites • Project architecture makes possible per-customer customizations • Run statistic reports to get some interesting facts about your properties 30
  31. 31. • Setting up a conglomerate with the real estate brokers in the remaining 5 countries • Setup of offices in the region one by one in planned and phased manner • Developing a back end web search engine connected with other portals providing refined results • Dealing with major real estate developers, architects and interior designers who enable to make custom made design for the clients • Making presence felt by marketing tools and communication media 31
  32. 32. • Entering the MENA region market with the introduction of web services • In the second stage with phase IV reaching the wide markets in the Asia and Far East region • These are high potential markets as having ever growing demands for customised services • The region lacks a professional customized provider, there is sufficient gap and scope for rendering services 32
  33. 33. Dr. Zia Ahmed “Ethical, Transparent and Sustainable” 33