Line with the declining prices in the property market, Abu Dhabi Securities Exchange’s will soon launch Real Estate Investment Trusts at the end of this year. Although REITs aims to boost the property market, experts assess that Abu Dhabi property prices will fall further about 20 percent by the end of 2010.
Abu Dhabi’s property market is down by 30 per cent and has make low valuation of UAE real estate assets, like in Dubai. So that it is an opportune time to pool funds under a REITs to get some advantages in the current climate. REITs are publicly traded real estate funds that own, manage and sometimes finance real estate and can be traded like stocks. Its also highly liquid because they are traded on stock exchanges like equities and provide investors with diversity in a portfolio which helps to spread risk.
In addition, REITs also well-suited to Islamic finance where there is a strong driver for investing in real estate. In the end, REITs will be able to provide new liquidity source and attract foreign investors to invest in various Abu Dhabi real estate and funds. Its an effective measures to attract public ownership in property investments.
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