Real Estate
Just as an example of this issue, we can point
Bahrain
Still open for business
Despite talk of a market downturn in Bahrain
and some sort of cataclysm in other parts of the
Author: Andy Hinson
Senior Director
Gulf region, there are sectors of the Kingdom
CB Richard Ellis Bahrain that are still holding firm.
F
or a prime example of this phenomenon
we need look no further than Seef Dis-
trict where rental rates for office space
that people actually want i.e. with the
right sized offices, professional management,
sufficient car parking, good access and so on,
are stable. Seef District seems to be the preferred
72 JUNE 2009
location for office space rental at the moment,
while the existing Central Business District, the
Diplomatic Area, is suffering from heavy conges-
tion, circulation problems and in many buildings,
a failure to provide sufficient parking. From our
data, rents in Seef have risen in the last few years
as shown in Graph 1 (opposite page).
to the recent experience CB Richard Ellis had
with a building still known as “LMC Building”.
We were offered the building to let and manage
in December 2008 and there was some concern
that this was “a bad time”, certainly as far as let-
ting office space in Bahrain.
We entered the market with a little trepidation
but just three months later and the building was
almost completely let at rates higher than what
we would have expected in 2008. In fact the
rates achieved were higher than some of those
at the World Trade Center building in central
Manama.
The building merely meets market require-
ments which in Bahrain are quite straightfor-
ward: shell and core finish, practical floorplates,
parking inside and outside the building, hassle-
free access, reasonable rent levels, professional
management and high visibility to potential cus-
tomers.
In fact, a number of new buildings have just
entered the rental market in Seef District and
they are all of the same ilk.
These buildings are relatively small but
practical, they have few traffic issues, they offer
parking inside and out and are in the increas-
ingly most sought after office district – Seef. The
continued interest in office space in Seef seems
to buck the GCC trend that we all hear about,
but could be the direct result of the Bahrain Gov-
ernment’s efforts to promote the Bahrain brand
across the globe.
Business Friendly Bahrain
The Government of Bahrain has been aggres-
sively pushing the “Business Friendly Bahrain”
campaign globally and this initiative allied to a
streamlining of administrative procedures has
succeeded in raising Bahrain’s ranking to eigh-
teenth in the World Bank – IFC’s “Ease of Doing
Business Index” (second in the GCC).
Partly as a consequence of this and the suc-
cess of Bahrain’s Free Trade Agreement with the
US, demand for office space remains relatively
strong with a number of multinational companies
continuing to choose Bahrain as their Middle
East operations base.
This decision has also been driven in many
cases by the spiraling cost of office space and
staff accommodation in other regional centers
such as Dubai, Abu Dhabi and Doha. The King-
dom is also well located for future growth, sand-
wiched between two of the regions wealthiest
countries – Saudi Arabia and Qatar and linked
directly to both by causeway in the near future.
Commercial licenses for businesses that typ-
ically occupy office space grew by 95 percent
between end 2004 and 2008 from 767 to 1,496.