Bahrain office rents fall 3rd straight year
Manama, August 1, 2011
Office rents have continued to fall in Bahrain for the third consecutive year following the peak of the market in 2008, said a leading property consultant.
Prime rates are down by a further 11 per cent in the first half of 2011 reaching a monthly rent of BD9 per sq m which is back to where the market was more than five years ago in 2005 and 2006, according to property consultants Knight Frank.
On a positive note, the rate at which rents have declined has slowed from a previous year-on-year dramatic fall of 30 per cent for the period 2009 to 2010.
With a continued increase in supply together with sluggish demand, vacancy rates are continuing to rise, reaching 26 per cent for all occupiable Grade A and B space available in the market.
The growth rate of supply has, however, started to slow, as the last of the grand office projects conceived during the boom times are coming to construction completion and only a limited number of new schemes have broken ground since the economic downturn.
Increased demand for Grade A/B office spaces is currently averaging 25,000 to 30,000 sq m per year and it is therefore estimated that it would take up to eight years for the current supply to be absorbed by the market if no other buildings were introduced during this period.
Inadequate provision of tenant and visitor parking continues to be one of the biggest issues facing many office projects across the country. Improved building regulation is required if this is to be addressed. – TradeArabia News Service