Sector Foreword

As we move through 2024, MENA's real estate, construction, and hospitality sectors drive economic growth. Key projects like Saudi Arabia's Vision 2030 and popular branded residences highlight this dynamic landscape.Contents

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Law Update: Issue 369 - Real Estate & Construction and Hotels & Leisure

Welcome to this
month’s Law Update

As we advance through 2024, the MENA region's real estate, construction, and hospitality sectors continue to be pivotal drivers of economic growth, shaping our regional dynamics with a tapestry of opportunities and challenges.

In construction, MENA is witnessing robust activity driven by ambitious infrastructure projects aligned with Vision 2030 in Saudi Arabia and similar strategic initiatives across the region. These efforts are expanding physical infrastructure and enhancing economic diversification and sustainability goals. The sector's resilience is being tested by an increasing frequency of natural disasters, prompting stakeholders to prioritise adaptive strategies and resilient infrastructure to safeguard investments and ensure long-term sustainability.

The real estate sector in MENA remains dynamic, navigating through various regulatory landscapes and market conditions. The law is changing and evolving. Discussions around property rights and legal complexities, such as those intersecting with divorce settlements, underscore the need to keep up to date with legal developments. The law around jointly owned property continues to evolve as does the treatment of cypto backed assets and there has been a continual pressure to develop a system of fractional ownership.

Strategically, the role of financial structures such as the much hyped REITs and real estate funds is gaining prominence, offering diversified investment opportunities amidst evolving market dynamics. In theory these should not only optimise returns but also contribute to the resilience and stability of MENA's real estate sector.

The performance of many of the existing entities does give rise to many questions however with the need for reform being discussed.

Family-owned businesses continue to play a significant role both in our practice and in shaping MENA's real estate landscape, requiring tailored strategies for sustainable growth and continuity across generations. Managing and structuring these enterprises effectively amid regulatory complexities and market dynamics is essential to preserving family legacies and maximising their contributions to the regional economy.

In hospitality, branded residences are still very much the ‘in thing’ reflecting consumer preferences and market trends across MENA. Our hospitality team, led by Ian Arnott, continues to receive new instructions almost weekly in this space from across the GCC and beyond.

Technology for as long as I can remember has been coming to revolutionaise the real estate industry, and for once it may actually be happening. This is highlighted in discussions on AI transforming construction practices, design and procurement processes across the GCC. These innovations are hoped to enhance operational excellence, improve project management, mitigate risks across construction projects, and support sustainable growth and innovation in the sector. There will (as is the way of construction) always be litigation and this is another area where our teams will inevitably need to ‘tool up’ for clients.

Curated by our specialists, these insights reflect our commitment to navigating the intricate pathways of MENA's construction, real estate, hospitality, and leisure sectors. From our team we hope you find some insight and have a prosperous rest of the year.