Fractional ownership, blockchain ‘can turn properties tradable’

Fractional ownership of real estate, powered by blockchain technology, can turn properties liquid and tradable among a more diverse pool of investors, a Deloitte report said.

 

To thrive in a disruptive economy, harnessing the exponential power of artificial intelligence can help key decision makers gain an advantage by transforming the data analysis process to drive real, tangible outcomes.

 

Developing dynamic 3D models and collaborative data platforms driven by digital innovation and technology can help enhance infrastructure planning, transportation and the utilisation of resources, said Deloitte’s eighth annual Middle East Real Estate Predictions report, which explores the future of real estate through machine learning, geospatial analysis, integrated data management and blockchain.

 

A review of available data sources, integrated data management and a robust implementation plan can support timely access to data and predictive capabilities during the real estate development process.

 

Average residential prices across Dubai have recorded a year-on-year increase, however, the pace of recovery varies by community. Based on data from REIDIN, waterfront locations such as Palm Jumeirah and Creek Harbour have recorded double-digit growth compared to 2020.  

 

Demand for secondary market residential properties continues to outpace transaction volumes for off-plan units, and the top three locations for volume of transactions in 2021 were Business Bay, Jumeirah Village Circle and Dubai Marina. Whilst cash transactions still dominate, the low interest rate environment has led to a significant increase in mortgage transactions over prior years.

 

Office rents for Grade A properties in the central business district have recorded year-on-year growth in comparison to 2020. The Middle East Office Survey conducted in November 2021 revealed that companies considering increased office space requirements are being driven by expansion of their business or addition of new service lines.

 

Looking ahead, companies are reconfiguring their workplace to ensure it is fit-for-purpose and this includes change in design and interiors to enhance more collaboration while also maintaining employee privacy.

 

Retail sales activity has been dominated by the increase in online sales, with categories such as food, fashion and home appliances expected to maintain growth momentum. There is a continued shift in consumer preferences for omnichannel experiences, which includes online shopping and click and collect in-store services. 

 

Retailers are expected to enhance their operations through restricting of outmoded supply chains, right-sizing inventory management, recalibrating promotional materials and reinventing the physical store for the digital age.

 

Warehouse occupiers in Dubai are expected to remain in the driving seat and push for long term leases. E-commerce and logistics segments continue to lead the demand for warehouse and distribution space, and new players are expected to enter the market in the food, furniture, pharmaceutical segments, among others. Investment in technology, particularly automation in distribution, is expected to be a priority for businesses, albeit the impact on profitability will be the primary consideration for any significant overhauls.

 

“By adopting machine learning capabilities for real estate analysis, better decisions can be made as the richness of market data improves.  As a result, key decisions on investing, budgeting and planning can be explored through simulating scenarios and evaluating their impact,” says Oliver Morgan, Head of Real Estate Development, Financial Advisory, Deloitte Middle East.

 

The report, which was released following a webinar and panel discussion of experts from Canada, UK and South Africa examines how digital initiatives are changing the way decisions related to real estate are made.

 

Stefan Burch, Head of Real Estate, Financial Advisory, Deloitte Middle East commented, “Deloitte’s Middle East team is uniquely positioned to provide clients with data driven insights and support early-stage business planning. We have successfully delivered projects using innovative, technology-based solutions and we continue to support both private sector and government clients in enhancing their real estate strategies in this dynamic marketplace.”-- TradeArabia News Service