The Bahrain-based alternative investment firm Investcorp has acquired real estate in US gateway cities as appetite grows for non-European assets with a recovering US economy.
The company has splurged US$300 million on four residential properties in Washington DC, Orlando, San Diego and Baltimore. That is around a third of what the company spent on US properties last year.
While Middle Eastern investors still prefer Europe for real estate investment, the share of the United States is on the rise.
This year, Middle Eastern investors are expected to invest between $10 billion and $12bn in overseas commercial real estate. Of that, the US market is expected to attract between 25 and 30 per cent as the US dollar appreciates against the euro and most currencies globally, according to Fadi Moussalli, the regional director at JLL International Capital Group, based in Dubai.
Last year, the US share of Middle Eastern investment in the same asset class was 15 per cent to 20 per cent. One euro today fetches 1.06 US dollar, down from 1.39 US dollars a year ago.
“The [Middle Eastern investors] are looking to rebalance their portfolio towards America away from Europe as the US is recovering and the investors want to pick up a chunk of that recovery,” Mr Moussalli said. “While the investors from dollar-pegged economies are better placed to acquire assets in the US, those from Germany, Australia and China are also chasing these.”
While the sovereign wealth funds of the Arabian Gulf countries are the majority of the investors, interest among private investors and wealthy individuals is also quite high, he said.
Over the next 10 years, Middle Eastern investors are expected to spend $180 billion in real estate abroad. Of that amount, around 80 per cent will go to Europe, CBRE said in a report last year. Close to $85bn will flow into the UK, with $60bn directed at continental Europe such as France, Germany, Italy and Spain.
Investcorp, however, bucks the trend by focusing solely on the US property market.
“Investors continue to have a strong appetite for investment opportunities in US real estate as a way to gain exposure to the solid growth of the US economy,” according to its 2014-15 half year financial statement last month. Its four recent US property transactions were for a total of 2.1 million square feet featuring about 1,900 multifamily and student housing units, with an average occupancy rate of 96 per cent.
Investcorp focuses on commercial, office and residential real estate assets in the US.
The private equity company has also invested in well-known US brands such as Tiffany & Co, Gucci, Saks Fifth Ave and Circle K convenience stores.
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War
Director: Siddharth Anand
Cast: Hrithik Roshan, Tiger Shroff, Ashutosh Rana, Vaani Kapoor
Rating: Two out of five stars
What is the FNC?
The Federal National Council is one of five federal authorities established by the UAE constitution. It held its first session on December 2, 1972, a year to the day after Federation.
It has 40 members, eight of whom are women. The members represent the UAE population through each of the emirates. Abu Dhabi and Dubai have eight members each, Sharjah and Ras al Khaimah six, and Ajman, Fujairah and Umm Al Quwain have four.
They bring Emirati issues to the council for debate and put those concerns to ministers summoned for questioning.
The FNC’s main functions include passing, amending or rejecting federal draft laws, discussing international treaties and agreements, and offering recommendations on general subjects raised during sessions.
Federal draft laws must first pass through the FNC for recommendations when members can amend the laws to suit the needs of citizens. The draft laws are then forwarded to the Cabinet for consideration and approval.
Since 2006, half of the members have been elected by UAE citizens to serve four-year terms and the other half are appointed by the Ruler’s Courts of the seven emirates.
In the 2015 elections, 78 of the 252 candidates were women. Women also represented 48 per cent of all voters and 67 per cent of the voters were under the age of 40.
UAE currency: the story behind the money in your pockets
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1. Lewis Hamilton, Mercedes 281
2. Sebastian Vettel, Ferrari 247
3. Valtteri Bottas, Mercedes 222
4. Daniel Ricciardo, Red Bull 177
5. Kimi Raikkonen, Ferrari 138
6. Max Verstappen, Red Bull 93
7. Sergio Perez, Force India 86
8. Esteban Ocon, Force India 56
The specs
Engine: 2.7-litre 4-cylinder Turbomax
Power: 310hp
Torque: 583Nm
Transmission: 8-speed automatic
Price: From Dh192,500
On sale: Now
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Chef Nobu's advice for eating sushi
“One mistake people always make is adding extra wasabi. There is no need for this, because it should already be there between the rice and the fish.
“When eating nigiri, you must dip the fish – not the rice – in soy sauce, otherwise the rice will collapse. Also, don’t use too much soy sauce or it will make you thirsty. For sushi rolls, dip a little of the rice-covered roll lightly in soy sauce and eat in one bite.
“Chopsticks are acceptable, but really, I recommend using your fingers for sushi. Do use chopsticks for sashimi, though.
“The ginger should be eaten separately as a palette cleanser and used to clear the mouth when switching between different pieces of fish.”
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Director: Eli Roth
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ABU DHABI T10: DAY TWO
Bangla Tigers v Deccan Gladiators (3.30pm)
Delhi Bulls v Karnataka Tuskers (5.45pm)
Northern Warriors v Qalandars (8.00pm)
SQUADS
Pakistan: Sarfraz Ahmed (capt), Azhar Ali, Shan Masood, Sami Aslam, Babar Azam, Asad Shafiq, Haris Sohail, Usman Salahuddin, Yasir Shah, Mohammad Asghar, Bilal Asif, Mir Hamza, Mohammad Amir, Hasan Ali, Mohammad Abbas, Wahab Riaz
Sri Lanka: Dinesh Chandimal (capt), Lahiru Thirimanne (vice-capt), Dimuth Karunaratne, Kaushal Silva, Kusal Mendis, Sadeera Samarawickrama, Roshen Silva, Niroshan Dickwella, Rangana Herath, Lakshan Sandakan, Dilruwan Perera, Suranga Lakmal, Nuwan Pradeep, Vishwa Fernando, Lahiru Gamage
Umpires: Ian Gould (ENG) and Nigel Llong (ENG)
TV umpire: Richard Kettleborough (ENG)
ICC match referee: Andy Pycroft (ZIM)