News| Raza Jafar: Changing paradigms and strategies will result in excellent opportunities for savvy investors in 2010 |
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In the aftermath of the global economic crisis it is important for companies, particularly the region’s real estate companies, to reassess their focus and objectives in order to ensure future growth and prosperity. So says Raza Jafar, Managing Director of ENSHAA PSC, a leading development and investment company with interests in the Middle East, North Africa, Asia and Australia. Jafar’s comments are in line with the findings of the Organisation for Economic Co-operation and Development (OECD) and the World Bank, recently published in the book Innovation and Growth: Chasing a Moving Frontier, that innovation in all areas is critical for the long-term economic growth of both developed countries and emerging economies, even more so in the aftermath of the financial and economic crisis. Speaking of the particular challenges facing the region’s real estate firms and the way forward, Jafar says, “The global financial crisis and subsequent economic downturn have ushered in a new era for the regional – and global – property market. Whereas a few years ago everyone was racing to develop and build as much as they could as fast as they could, this is no longer a viable strategy, and companies are being forced to re-evaluate their objectives and strategies, and to focus on producing a smaller number of high quality projects. There has been a complete paradigm shift in the regional property market, and as the focus of the developers is changing, so the focus of investors also needs to change. Now is the perfect time for the savvy investor – whether individual or corporate – to take advantage of the investment opportunities that will follow in the wake of companies’ reassessing their long-term plans.” “There is definitely a change in mindset taking place, and what both companies and investors need to be focusing on now is consolidation of projects and resources, and quality over quantity. Even without the global crisis the region’s real estate boom was never going to last indefinitely and this is why it is important to have long-term strategies in place and be prepared for whatever changes the future might bring. If sufficient thought goes into strategic planning, then even when something as unexpected as the global financial crisis occurs it becomes a matter of adjusting the plan – whether in terms of timelines, projects or objectives – to reflect the challenges faced, rather than having to create an entirely new plan from scratch when crisis hits,” Jafar continues. “In light of this, I believe that we can expect to see a number of investment opportunities become available in the course of 2010, partly as a result of companies and investors looking to divest themselves of projects or resources that no longer fit with their revised strategies, and also partly due to the significant impact the challenges arising from the crisis is likely to have had on the number of speculators in the regional market. The decline in the number of speculators leaves the way open for serious investors to maximise on the opportunities presented by the rapidly changing market,” he adds. “In the long run, this focus on the consolidation of projects and resources, and on quality rather than quantity, is a good thing for the market, and the end result will be a stronger, more mature regional property market that is better able to withstand challenges in all areas. The challenge now is to come up with the best ways to weather the aftermath of the crisis, although we are seeing signs that the worst may perhaps already be past, and to build in the future to encourage continued growth and prosperity.” |
