According to ValuStrat’s latest study, the third quarter of this year saw a strong market for office space in Qatar.
With the completion of the Mercedes Flagship Commercial Complex, the data shows that around 38,000 sq m GLA was added between July and September, increasing the total stock to over 7.2 million sq m GLA. The last tower is expected to be delivered by the middle of 2025, but one of the remaining Lusail Plaza Towers should be finished this quarter.
Market analyst and Head of Research of VauStrat in Qatar, Anum Hassan stated “The office sector showed consistent performance on a quarterly basis, reflecting no notable fluctuations.”
According to the survey, Doha municipality accounted for 61 percent of the overall supply of grade-A office inventory, with Lusail contributing another 31 percent.
Meanwhile, an additional 170,000 sq m GLA is anticipated to be delivered by the year-end. “Office occupancy at a country level was estimated at 63 percent with premium locations experiencing higher occupancy compared to secondary areas,” the report said.
In contrast, office rents in Qatar averaged QR66 per square meter, which was unchanged from the second quarter of this year but down 2.2% year over year.
While staying constant from quarter to quarter, the office occupancy rates in Grand Hamad Avenue and West Bay fell by 13% and 6%, respectively, in comparison to 2023.
However, compared to other important sites like Lusail and Salwa Road, office space in Al Sadd increased by 4.7% annually.
little change from Q2 2024, with annual declines ranging from 3 to 7 percent.
The research also notes that in Q3 2024, there were 227 mortgage transactions in the Qatari real estate market across all asset classes of ready homes, resulting in an 8.5 percent year-over-year decline.
In the third quarter of 2024, the total value attributable to mortgage transactions was QR6.8 billion, representing a 7.9 percent increase over the same time the previous year.
The US Federal Open Market Committee, meanwhile, decided to lower the federal funds interest rate to a target range of 4.5% to 4.5%. With 90 contracts worth QR4.6 billion, Doha municipality contributed the most to mortgage transactions. Al Rayyan followed with 69 deals totaling QR1.6 billion.
Hassan reiterated that “Mortgage transactions declined by 10 percent Q-o-Q and 8.5 percent Y-o-Y. Similarly, sales transactions dropped by 18 percent since the last quarter and 15 percent compared to the same period last year.”
She further added that “The Qatar Central Bank, aligning with the US Federal Reserve, reduced the interest rate by 55 basis points. These concurrent changes could suggest that buyers may be holding off on purchases in anticipation of a more favorable rate decrease.”
