Office space market crash feared

Office space market crash feared

Consultants predict a supply-demand imbalance resulting in a flight to quality Dubai: Thousands of square metres of new office space due to come online in Riyadh over the next two years has raised fears of an office market crash after 2012.

Analysts say that an expected 830,000 square metres of office supply is expected over the next two years, with hundreds of other buildings under construction in the central business district of the Saudi capital as well as the under-construction King Abdullah Financial District (KAFD).

“With over one million square metres of high quality space being added to a market inventory of only three million square metres, there is some concern that the office market will crash after 2012,” says a report issued this week by property consultancy Jones Lang LaSalle (JLL).

While the report concluded that Riyadh would witness a ‘flight to quality’ with a mass of grade A office space coming online, Saud Masud, an analyst at Rasmala, said that much high-end space — such as the KAFD — was years away from handover.

Continue: http://gulfnews.com/business/property/gulf/office-space-market-crash-feared-1.954559

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