In part, the resilience of Kuwait’s property sector during the financial crisis of 2008 was reflective of the weak private sector activity in real estate. Kuwait came late to the regional real estate boom and the uptick in its projects market in 2007 was quickly curtailed by the global economic crash. Over the period 2005-11, residential apartments and villas constituted 34 per cent of total project spending, while commercial office space comprised 13 per cent.
As a result, the glut of prime real estate seen in the UAE and Qatar is not as readily available in Kuwait. But there remains plenty of residential properties for expatriates and a significant amount of vacant office space for companies.
Although relatively small, Kuwait can be chaotic during rush hour in busy periods of the year, and your accommodation needs will largely come down to how willing you are to commute.
There is also the question of whether you want an apartment – ideal for singles and couples – or a villa, which is preferable for families. Being in close proximity to malls and restaurants is important to some people, while others set a premium on being able to walk around the area they live in – not always an easy option in Kuwait.
Many expatriates enjoy living in Salmiya, which lies just southeast of Kuwait City, in the emirate’s Hawali district. It has a major shopping mall – Marina Mall – and is made up of modern real estate and commercial developments. Quite a few of the city’s more upmarket hotels are in Salmiya. Others are drawn to the quieter Salwa area, which houses several western embassies and international schools.
Apartments and villas
Salmiya and Salwa offer decent housing, easy access to shopping and even the option of a stroll by the sea. Salmiya mainly consists of apartments, while accommodation in Salwa largely comprises villas. Another popular area for expatriates is Falaheel, which houses a mix of apartments and villas.
An important point to note is that foreigners cannot buy property in Kuwait, meaning you will be forced to rent regardless of how long you stay. A furnished one-bed apartment will run to KD300-400 a month ($1,000-1,500) in popular districts, while a decent-sized family villa starts at roughly KD800; three-to-four-bed apartments in tower blocks cost slightly less.
Unlike in neighbouring Saudi Arabia, compound living is relatively rare in Kuwait. Where developments exist, they are both expensive and difficult to find spaces in. Expatriates recommend the Pearl development in Qadsiya and the Pearl al-Mazrooq.
If you are new to Kuwait, it will be worth getting in touch with a real estate agent to get a better feel for how much you will need to spend, although haggling is recommended once you have decided where you want to live.
Speculative commercial real estate projects started during Kuwait’s pre-crash boom years have led to a large overhang in office supply in the city, with more space due to come online in 2012 and 2013. Despite the emirate’s strong economic growth in recent years, its underdeveloped private sector has meant that there are few clients in a position to absorb the excess. Vacancy rates in the city are estimated at more than 30 per cent.
The government has been leasing a number of offices as part of attempts to ease the oversupply, but, according to analysts at Jones Lang Lasalle, have not been able to dent the available office space of more than 1.2 million square feet.
Popular locations include the Central Banking District and the Sharq areas of Kuwait City, and Kuwait Free Zone. Appealing locations for businesses new to the country include the Sahab Tower, Arraya Tower and, latterly, the new Hamra Tower.
Rents in prime locations are about KD6-8 a square metre, down significantly from the KD12-15 charged in 2009. Businesses in the city report that even quoted figures are open to negotiation and that some occupants have even been able to renegotiate deals sealed during the boom years.
Kuwait is home to a wide array of hotels, from luxury five-star properties to reasonable budget offerings, including the standard cluster of properties located in the vicinity of the airport. Room rates at city properties can range from $60 a night to more than $1,200.
Many hotels have been competing for the regional conference market, so there are more than enough conference centres, giant halls and plush meeting rooms to go around. Be warned though: even budget offerings can be costly, and the alcohol ban extends to hotels.
Selected Real Estate Agents
The Courtyard by Marriott
Al-Shuhada Street, Dasman
Tel: (+965) 2 299 7000