Market activity
The forces brought on by pandemic recovery and the quickly approaching United Nations’ 2030 Agenda appear stronger than the downward pull of recent ongoing materials issues causing delays and increasing costs as can be seen in this summary of several Gleeds EMEA markets.
Many markets in the EMEA are continuing to build in the residential sector as a response to long standing shortages or demands for modernization. The recent EU Recovery Plan, NextGenerationEU, outlines the agreed intention to invest over €800bn in projects that address current global issues like sustainability, accessibility, and inclusion. Several member states have already defined their plans to invest in various solutions requiring construction works, such as affordable housing for all age groups, energy efficiency of buildings, low-carbon equipment and materials amongst others.
Several of these EU goals are direct responses to the United Nations 2030 Agenda and can be seen in other EMEA countries where Gleeds is active such as Egypt, Qatar, Saudi Arabia and the United Arab Emirates.
Middle East and North Africa
Egypt is experiencing a construction boom that is expected to continue for a few more years. The residential sector has always been one of the busiest in the local construction industry. Despite the current impact of the pandemic, the sector has not shown any signs of slowing down. The Egyptian Government is addressing a supply gap of three million residential units, especially in the Old Capital plagued by long-standing squatter areas, by relocating residents to newly established low and middle housing areas and demolishing existing ones. This is creating urban planning opportunities and prime real estate sites for development by local (Sodic, Palm Hills Development, ORA, etc.), existing Gulf companies (Emmar, Majid Al Futtaim and Al Futtaim group, etc.) and new entrants (Al Dar) making this one of the most vibrant sectors of the market.
The Qatar National Vision 2030, initiated in 2008, defines the country’s plan to develop an “advanced country” based on sustainable development. As a result, Qatar has experienced years of continued national investment in infrastructure and other major construction works. The nation is now geared up for the international spotlight as it prepares to host the 2022 World Cup. All of these government funded initiatives and recent changes in legislation that simplify requirements for foreign ownership are expected to drive a boom in housing construction in the short-term. The new law allows expatriate residents, investors, and funds to purchase housing and mall shops in 25 districts. Ownership of at least $200k in properties will also grant permanent residency without the need for a sponsor, giving access to public services like healthcare and education.
Downton Doha / Doha, Qatar
Gran Vía 48 / Madrid, Spain
Mainland Europe
NextGenerationEU generally promotes energy efficiency in buildings. Many countries have focused their use of funds towards renewing existing buildings, including residential, but getting across the finish line requires foreseeing the ripple effect of increased construction.
Central European countries have seen an opportunity to improve operational systems in the pre-construction phases. The Czech Republic has particularly focused on streamlining and digitising its Construction Permit procedures to bring speed to the traditionally slow process and increase Investor interests in the region. Slovakia also addresses the role of the government in driving construction by simplifying procurement procedures.
Some Western European countries have thought about how increased construction will impact the industry in the future. France’s Recovery Plan proposal anticipates increased demands in skilled labour and will invest in training to pre-empt potential shortages. Germany has chosen to support SMEs (small and medium-sized enterprises) in the timber industries requiring upgrades to their facilities and/or technologies to prepare for increased demands in climate friendly construction materials.
The Student Housing, Co-Living, and Senior Housing industry in some European countries is expected to continue growing especially considering new Government incentives encouraging the creation of affordable and accessible housing that adopts “green” and inclusive design initiatives. Although post-Pandemic student housing demands have decreased in larger markets, smaller markets that were already under-supplied are maintaining continued PBSA (Purpose Built Student Accommodation) development as can be seen in several Gleeds EMEA countries such as France, Germany, Italy, Poland, Portugal, and Spain.
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