Bahrain is set to attract significant investments into its property market, thanks to the new real estate development law that comes into effect in February 2015, said an expert.
The new law No. 28 introduced this July, seeks to protect the interests of investors and developers by establishing a structure for such projects, according to Charles Russell, one of the premier full service law firms in the Middle East.
The law makes it mandatory for the developers to obtain a licence and set up an account to allocate all the funds for the project. This is mainly to ensure that the funds raised from the market will be used for a specific project, thus providing high level of governance, it added.
“The new law will attract more investments into the real estate market in Bahrain and restore investors’ confidence in this growing market,” stated Reem Al Mahroos, an associate at Charles Russell, which has a major regional presence with offices in Bahrain and Qatar.
Al Mahroos was speaking at a workshop hosted by Charles Russell to discuss the new real estate development law in Bahrain.
“More than $2.8 billion has been invested in mega real estate projects in the kingdom and the new law will set a framework to regulate and support such projects,” she stated.
The law also proposes a dispute resolution function which will assist developers and investors in a quick settlement of disputes to ensure smooth progress of the project, thus safeguarding the interests and rights of the investor, added Al Mahroos.
The workshop, held at the Capital Club in Bahrain, was introduced by Simon Green, the firm’s head of real estate and construction in the Middle East and included presentations from Unkar Chanian and visiting partner, David Savage, the global head of property and construction to an audience of over 70 industry professionals.
As per the latest Bahrain Economic Quarterly report issued by the Bahrain Economic Development Board, the real estate and property market in Bahrain grew by 4.5 per cent in the second quarter of 2014 compared to 1.8 per cent growth in the second quarter last year