Investment Bonanza: Britain & Qatar

April 24, 2017

LONDON - If Brexit has caused any negative emotions among international investors about the future of Britain the state of Qatar in the UAE is obviously not one of them. Qatar just announced a major £5billion investment over the next three to five years for transport, property and high tech. Over the years the country has invested close to £40billion which includes the London store Harrods and 95% stake in the skyscraper The Shard on the river Thames.

 

Qatar has also acquired such property as the Olympic Village from the 2012 games and a £2.6billion investment in developments in Canary Wharf financial district. Other landmark holdings include Chelsea Barracks which is undergoing regeneration for flats by Qatar investors. Its reached the point where property ownership by Qataris is three times more than HM the Queen has in her portfolio.

 

History By The Numbers

 

The Qatar Royal family, Qatari investment funds and Qatari nationals have  chosen the Mayfair to invest so much so that a new “Qatari quarter” has started to to take hold. The popularity of the district is not surprising as it borders Park Lane and Hyde Park with easy access to Knightsbridge. Estate Agent Rokstone states in London Loves Business: “The ‘Oil Royals’ and wealthy families from the Middle East view Mayfair as a luxury village and their favourite place in London, alongside Knightsbridge, for luxury shopping, dining out and leisure. Over two-thirds of Mayfair residents typically eat out 3-4 times per week and Middle East residents spend on average £1,900 per shop.” 

 

As of January 2016 Qatari investors had spent £1billion on property investing in Mayfair.

 

One example of of their love for houses in London was the purchase and redevelopment of 1 - 3 Cornwall Terrace. The Qatari buyer Sheika Mozah bint Nasser Al Missned, one of three wives of the former emir, Qatari Sheikh Hamad bin Khalifa bin Hamad Al Thani purchased the three adjacent homes and merged the three in to a gigantic mansion. The purchase made in 2013 was for £120million. The building is now worth well over £200million.

 

Another long time Mayfair property The Embassy of the United States on Grosvenor Square was purchased by developer Qatari Diar, under the control of the Qatari Investment Authority fund, for a £1billion redevelopment into a 137-room luxury hotel, shopping and restaurants. Adjacent 20 Grosvenor Square will see a conversion to 37 luxury apartments with prices starting at £4million for a one-bedroom and a five bedroom unit for £35million. The property features a pool, cinema, gym, a screening room and parking.

 

There’s more.

 

One of those was the 185 year old 17 bedroom Dudley House at 100 Park Lane. Along with its 50 foot ballroom it was long considered to be one of the city’s most expensive homes. The 2006 purchase price reported for the grade II* listed 44,000 sq ft residence was £37.4million but is now thought to be worth far more after all of the millions were spent renovating by Sheikh Hamad bin Khalifa Al Thani. Its been thought that the residence property value exceeds £250million - and that was in 2012.

 

Other properties that Qatar have invested in are One Hyde Park with 86 residential properties marketed with prices starting near £20 million. Also, Chelsea Barracks bought by Qatari Diar in  January 2008  joint venture for £959million and was reported to have already sold 30 homes by 2016 out of 450 to be available. The project is to be completed by 2024 and could reach a value of £3billion. 

 

And its not just prime residential property Qatar has had its interest in but also in the hotel and hospitality sector. The Constellation hotels of Qatar bought a 64% share of London’s well known  hotel company Coroin in 2015 with some reports of of the price tag being around £1.6billion. The Coroin hotel group is known for its luxury properties The Berkeley, Claridges and The Connaught.

 

Grocery chain Sainsbury's is now a quarter owned by Qatar as the stake was increased in 2007 becoming the company’s biggest stakeholder.

 

In 2012 Qatar Holdings purchased a 20% stake in Heathrow Airport it snapped up this stake in for £900m.

 

In 2015 Lord Sugar sold the old London headquarters of luxury goods company Burberry on Haymarket for £65million to Qatar investors.

 

One of London’s most well known landmarks Harrods was was purchased in 2010 for £1.5bn. Sheikh Hamad bin Khalifa Al Thani was quoted telling the Financial Times: “We are investing everywhere. Even your Harrods - we took it.” 

 

UK - Qatar Free Trade Agreements

 

Last month PM Theresa May visited Qatar to reaffirm the close relationship the UK has with the emirate. Trade and security were the main points of discussion along with relations with the Gulf Co-operation Council that will be hosted in the UK this year.

 

British Secretary of State for International Trade Liam Fox, emphasised the value of  bilateral ties with Qatar especially now that Brexit is coming in to the trade picture.

 

At a trade conference in Qatar Mr. Fox stated, “After 40 years, Britain will have chance to develop our own trade policy. We’re now opening a new chapter in our history,” he told Qataris at the investment conference. 

 

“We’re looking beyond the borders of our own continent. It means strengthening our commitment to our oldest friends and allies; Qatar is one of these." 

 

British firms are also preparing to invest in Qatar infrastructure and projects as Qatar prepares for the 2022 World Cup to be held in Doha. The International Monetary Fund expects Qatar GDP to be almost 3.4% an increase from 2.7% in 2016. The UK is reported to have 80 wholly-owned subsidiaries in Qatar and 670 joint venture projects.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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