RIYADH: UAE homebuilders are expected to pivot toward preserving liquidity in the wake of the recent geopolitical shock in the Middle East, according to Fitch Ratings.
The credit ratings agency noted that while the immediate impact on the sector has seen a drop in on-site viewings, a substantial backlog of pre-sales and funds held in escrow should provide a cushion for rated companies in the near term.
The escalation of regional hostilities is presenting the first significant challenge to the UAE’s property boom.
Since Feb. 27, the last day of trading before the conflict began and subsequent market closure, shares of major developers have trended downward. Aldar Properties has seen its share price decline by 22.2 percent, while Emaar Properties has dropped 21.9 percent to date.
Fitch’s analysis focused on a portfolio of UAE developers clustered at the “B+” and “BB-” rating levels.
