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HomeWorldValue of GCC fits-outs to grow by $1.17bn this year

Value of GCC fits-outs to grow by $1.17bn this year

Investment in interiors and fit-outs in the GCC this year are set to increase 26 percent on the $4.5bn spent last year, a new survey said on Sunday.

The report by Ventures Middle East, which focused on commercial, hospitality, residential and retail projects – showed that interiors accounted for up to 30 percent of costs for GCC developments.

“The GCC real estate market is showing positive signs for the interiors market. With existing projects at or near completion and countries around the region expanding specifically in the commercial and hospitality sectors, there will continue to be a strong demand for interiors and fit-outs,” said Paula Al Chami, event director for INDEX, the MENA interiors and design exhibition.

“Another trend we see is companies shifting focus from starting fresh projects to managing existing projects to make them more attractive, which is where interiors will play a key role.”

Of the key sectors in the GCC, the growth of the hospitality sector led with an expected 230 percent increased spend in 2011 of $1.8bn as hotel groups aggressively expand across the region, the report said.

The UAE, which led all GCC markets with an interior spend on hospitality of $406m in 2010, will more than triple its growth in 2011 with an increased spend on interior contracting and fit-out nearing $1.3bn, it added.

In the competitive retail sector, $243m was spent in the UAE in 2010, making it the largest retail market for interiors in the GCC.

Overall in the GCC, investment in interiors is set to grow in the retail segment with an increased spend of 71 percent expected in 2011 versus last year’s spend of $384m. For the commercial sector, which now sees companies focusing on property management rather than new projects, interiors spend is set to increase 36 percent to $1.5bn, the report said.

The UAE’s commercial sector remains strong with a 16% increase in spend this year versus 2010’s spend of $709m. Reflecting this growth is the fact that between 2010 and 2012, 19 million m2 of office space will have become available for interiors and fit-outs in the UAE.

The UAE remained the largest market in the GCC for the residential sector in 2010, with interior spends of $1.1bn, a trend that continues into 2011. Overall GCC spend on interiors in the residential sector was $2.5bn. The report also said that from GCC real estate contracts issued from May to July this year, the value for interiors and fit-outs is estimated at more than $700m.

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