UAE Property Portal Raises $9m Venture Capital for GCC Expansion
One of the UAE’s most successful property portals, Bayut.com has announced plans to expand further into GCC property markets, after securing $9 million in venture capital from three global investment funds.
Bayut.com ‘s holding company Zamzama Property Group, which also controls Zameen.com, Pakistan’s leading property portal, has received investment from three funds including Vostok New Ventures, which also invested $34m in BlaBlaCar, the world’s largest long distance ride-sharing community last month.
Vostok’s managing director Per Brilioth has joined Bayut’s board of directors and the portal also welcomed Middle East property experts Simon Baker, Roland Tripard and Gilles Blanchard to its team as part of its significant push towards expansion in the GCC.
Haider Ali Khan, CEO of Bayut said: " Bayut has been busy working on its business intelligence and gathering quality resources for expansion into Saudi Arabia and other GCC markets. The results have been overwhelming and, with the right people on board who possess the right know-how for expanding into new markets, we’re set to move forward aggressively ".
Property markets across the Middle East have shown mixed performance in 2015, with speculation swinging like a pendulum between boom and bust forecasts, particularly in residential markets. A shortage of affordable supply across the region has significantly reduced transaction volumes, according to official statistics.
However, foreign investment in GCC property is on the up, as property price declines outstrip falls in rental values, resulting in significant yield opportunities. This dynamic is particularly strong in Saudi Arabia which has seen transactions plummet 14% since last year, according to figures released by the Ministry of Justice in August. The Saudi Gazette reported that the total value of real estate deals completed so far this year has reached $74bn, including commercial and residential transactions.
Saudi property developer Ibrahim Al Subaie was quoted in the Saudi Gazette as saying: " The percentage of real estate deals in some parts of north and south Jeddah and in Asfan and Dhahban dropped by 20% since the beginning of the summer holiday. In areas with low population density the rate dropped by 30% ".
Despite difficult market conditions, Bayut has continued from strength to strength, returning more than 100% year-on-year growth across all metrics so far in 2015, including paying agencies and traffic while its competition stagnated in the face of a slow UAE market .
The portal’s newly appointed Chairman Gilles Blanchard, one of the founders of SeLoger, the largest French property portal commented: " Bayut not only has the best brains in the business but also boasts the requisite expertise and resources for providing the best solutions to the industry’s needs. With the excess capital at our disposal, we are going to invest further in technological innovation and providing an unprecedented quality of service in the markets we tap into ".
There are plenty of opportunities for price growth in Saudi’s property market, with realtors Colliers International identifying an investment hotspot called Half Moon Bay, located south of Al Khobar and Dhahran. The region is frequently visited by Saudi families during weekends and holidays and it’s a popular place to own a vacation home.
With significant residential development in the area and more in the pipeline, Half Moon Bay has experienced high demand, achieving 152% higher than average selling rates in 2014 and on target for a similarly stellar performance this year. Colliers attribute the significant rise in interest in Half Moon Bay to its leisure focus, with villas and chalets in midscale and upscale resorts in the area.
Bayut’s considerable experience of operating successfully in difficult conditions and identifying growth areas ahead of the competition through its dedication to top quality property market research is set to project the portal to dominance in the Middle East, as it expands further into other GCC markets.
Article by +Roxanne James on behalf of Propertyshowrooms.com
