Abu Dhabi Lures Tourists, Investors

Dubai may be the most popular emirate but Abu Dhabi is where the real money is. Despite its small size, Abu Dhabi makes up over half of United Arab Emirates' (UAE) GDP and has more in cash and energy reserves than most large countries.


The emirate's sovereign wealth fund, the Abu Dhabi Investment Authority, is conservatively estimated to hold between $350 B and $700 B in assets including huge stakes in Barclays, Citigroup, and real estate in top global investment destinations.


Abu Dhabi holds nearly 10% of all the world's known oil reserves (5th largest), and produces 90% of all oil within the UAE. With the world's sixth largest natural gas reserves, the emirate is also wealthy in non-oil assets.


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US Home Sales Plunge in December 2009

Home sales fell 16.7% last month, its largest decline in about 4 decades as the effects of the first-time home buyer tax credit faded. National Association of Realtors data suggest that first-time home buyers made up the majority of home sales in the early part of 2009, compared with just 43% in December.


Regional sales declines were greatest in the Midwest at 26% and least in the South at 16%. Both unemployment and foreclosure rates help to explain the differences in regional home sales figures.


The good news is that December 2009 sales and prices were up 15% and 1.5% respectively over December 2008. However, inventory was also down during the same period, lessening the legitimacy of year over year sales and price increase.

Top 10 U.S. Real Estate Investment Destinations in 2010

Based on Association of Foreign Investors in Real Estate/University of Wisconsin survey results



Washington, DC was yet again named America's top real estate destination for international investment, beating out New York, San Francisco, and Boston respectively. A survey conducted amongst members of the Association of Foreign Investors in Real Estate (AFIRE) found that for a second year in a row, multi-family units were the preferred form of real estate investment.


Although Washington was the world's top real estate investment destination last year, London emerged to capture the top spot by a huge margin. This may be attributable to London's investments in preparation for the 2012 Summer Olympic Games, the weakened Pound Sterling, and a rebounding property market. New York remained the world's third most favored destination, followed by Paris, Tokyo, Sydney, San Francisco, and Hong Kong.





10. Denver


By the end of 2009, the mile-high city's property market seemed to be nearing a bottom as both vacancies reached 4-year lows. The Central Business District and Lower Downtown office vacancies faired a lot better than most major markets in the third quarter at just 13% and 15% respectively; however, by the fourth quarter, vacancies fell across the entire region.





9. Miami


Although Miami was one of America's hardest hit real estate markets, this year we've seen signs of recovery. In 2009, over one-third of new condo units were vacant, but real estate professionals are reporting that things are improving. Miami still remains a popular spot for international real estate investors for the city's warm climate and significant portion of celebrities.





8. Chicago


With the second largest office market and third largest real estate market in the U.S., Chicago remains a favorite destination among international investors. As such, Chicago's office vacancy rate was one of the lowest in the U.S. at only 12% by the end of 2009.





7. Seattle


Seattle's office vacancies are at 20-year lows, which translates to over 20% in the downtown/financial district. Local brokers and developers have a negative outlook moving forward, however, international investors think highly of the Emerald City, with its highly educated workforce, presence of Fortune 500 companies, and large international port.





6. Houston


Houston's real estate market was close to the national average with overall vacancy rates of about 16%. The city has held up well but in some suburban areas, vacancy rates were much higher. When it comes to local residential real estate, a recent survey showed that most investors have a positive outlook moving forward.





5. Los Angeles


Down from the #4 spot last year, the L.A. area was amongst the country's hardest hit property markets. Some of the city's
most notable landmarks, like the U.S. Bank Tower, is nearly 35% vacant. However, in downtown, rates remained at 14% going into 2010, while the Burbank-Glendale-Pasadena submarket saw a surge to 17%.








4. Boston


Boston was this year's biggest gainer, having moved up from seventh place last year as it was seen as one of the most stable markets in terms of both prices and vacancy rates. Boston remains a favorite US destination due in part to its proximity to Europe and zoning regulations and tight property market.








3. San Francisco

San Francisco was one of the country's hardest hit markets, which once saw over 30% vacancies in the financial district office market last year. But international investors still favor San Francisco as it's a major financial hub and one of the world's top international tourist destinations.







2. New York


The country's largest office and housing market saw one of the lowest office vacancy rates amongst major cities, but also one of the steepest declines in prices. Recent trends suggesting a decline in sublease space indicates that office vacancy rates will stabilize in 2010.





1. Washington, DC

Office vacancies and prices were amongst the most stable in the nation as demand for proximity to the federal government, lobbyists, and law firms makes central Washington an attractive market. As suburban markets in Northern Virginia show signs of recovery, DC's office market is expected to follow suit in 2010. International investors love DC's European feel and future growth prospects.



Photos courtesy of: Ken Schroeppel (Denver); Wikipedia user, Aude (Chicago)