Riding the Real Estate Cycle: Building Capabilities for a Sustainable Future [Report]

by wamda, May 20, 2013

This report, published by Strategy&, explains the Arab world’s property market bust that exposed deep structural prob­lems in the region’s real estate development.

The report reveals major errors made by developers that led to the market's downturn, while offering a prescription for a more balanced and stable real estate market going forward. By following a market-driven approach to real estate development, the report concludes that the market will stabilize and new construction will move forward alongside real demand.

Major mistakes outlined in the report include:

  • No focus. Developers grew in all directions with unfocused business models targeting a range of assets in different countries, as well as multiple segments and classes.
  • Not profit-driven. Not having to worry about commercial capabilities and profits given the buoyant market, develop­ers rushed to deliver.
  • Poor risk-management. Most regional players had volatile revenue streams and managed risk poorly—depend­ing excessively on property sales, as opposed to recurring income from leasing and other operations.

Recommendations for moving forward:

  • Focus. Developers must first decide what kind of developer they want to be and where to operate on the real estate value chain.
  • Identify real opportunity. Developers should master their chosen markets, and understand all components of the real estate ecosystem so that they can identify and pursue attainable growth opportunities and create sustain­able value.
  • Follow a balanced plan. Developers should manage their exposure to market risk better by seeking more balanced revenue sources, and elaborating clearer investment and development guidelines.
  • Deliver on what matters. Real estate players should start developing a set of core capabilities (e.g., opportunity identi­fication, development, asset manage­ment) to deliver sustainable value.

Check out the full report’s findings by downloading it from the grey box on the right.

pdf(0.39 MB)
View 939
Download 1942
Commentswith facebook
Commentswith Wamda
Sign in  to leave a comment
Not a member yet!
register now
Abdul bari Chanessra , Tue 08.07.2014
This post has helped me for an article which I am writing. Thank you for giving me another point of view on this topic. Keep it up. go to website
Abdul bari Chanessra , Tue 08.07.2014
This post has helped me for an article which I am writing. Thank you for giving me another point of view on this topic. Keep it up. review
Abdul bari Chanessra , Tue 08.07.2014
Thanks for sharing such a nice information with us. Please keep on posting so that I can keep myself updated. gold IRA
Lavinia Maag , Wed 02.07.2014
Thanks for the different tips contributed on this website. I have realized that many insurance agencies offer buyers generous discount rates if they choose to insure a couple of cars together. A significant variety of households currently have several cars or trucks these days, particularly those with elderly teenage young children still residing at home, along with the savings on policies might soon begin. So it pays to look for a good deal. Injustice Hack Android
Miled Drum , Thu 12.06.2014
I am interested in this subject matter and would like to explore out some more information as my colleague need information on this topic. Do you have any other post on this? Cheers!
best dui lawyer
load more