Foreign Markets especially the Middle East GCC Region Part 1
Foreign Markets especially the Middle East GCC Region Part 1
PART (1)
Hi all, and welcome to my discussion on foreign markets. I have been living overseas now for some time with my family and we have been in and around the United Arab Emirates for about 4 years. It is a little oil country that boarders Iran across the straight or Hormoz. This area is a strategic point for shipping oil in and out of the Arabian or (Persian Gulf) depending if you are Sunni or Shia Muslim. I mention this because our military has a strong presence here as the 5th Fleet. This is the second largest in the U.S. Navy and they park their ships in and around this area. Most of you have heard of Dubai, this is in the UAE.
Here is a little history about me. I started as a contractor in the state of Florida working for developers and investors. We worked mostly helping to build speculation houses for a few local builders and did quite a bit of remodels, mostly kitchens and bathrooms, a lot of land development as well. Over the years, and as the economy started to turn, our area was hit especially hard by the bubble burst. Competition became fierce and as an owner I knew we needed to adapt or close the company. We downsized from 25 to crews of about 15. One of the strengths of our teams was their ability to fit out small to medium sized retail space. This gave me some very valuable experience that I would soon use overseas. Eventually time and limited cash flow forced me out of the business. However, I had gained some significant experience in the property management arena.
When we came to the UAE, we arrived in the capital of Abu Dhabi. The size of the buildings here blew me away! I came from a city, (Jacksonville Fl.) that maybe had 1 or 2 buildings over 40 stories. In Abu Dhabi you could find 5 buildings this tall within one city block. It was then I had the proverbial light bulb moment, “If I could make it in the U.S. for 18 years as an owner operator this place was going to be easy.” I had a lot to learn…..
Although I was not a registered or licensed real estate broker in the United States, I was quite the salesman. Often times we would have clients show up on our sites to have a look around and ask questions. That would often lead to me closing a deal and splitting commissions with listing brokers who were glad to have me as an ally. In Abu Dhabi it was much like this for me from the start. Initially I was only interested in Property Management but later found out that the country was not regulated by any real estate governing board and that the laws here were still being written. It really has been a Wild, Wild West story here, especially for folks from back home that have come over here to work.
I found a firm that brought me on as a leasing agent, which was fine by me as most of my experience was in leasing. I learned a lot in the three months that I was there, mostly about the trends that are set here and the forces that drive these market trends. Most of the major developers in the UAE and surrounding GCC regions are what they call semi-government agencies. This means to say they act and look like private organizations, but their owners are certainly well connected with the ruling family. What does this mean really? I’ll get to that in a moment.
I didn’t really understand it at first, but after sometime in the market here I understood it much better. Most of my senior colleagues were open with sharing information with the new American expat and I enjoyed the mentor-ship often helping them with the knowledge that I had as well. Along the way I was introduced to different developers that were in the marketplace and their management as well. I built relationships that I am still using today. (Please see part 2)
Cheers,
Christopher Adkins