Real estate and restaurants--the bubble has Burst

KUWAIT CITY, March 11: The managements of some commercial complexes have received letters from a number of agencies of well-known brands about their intention to leave the sites they rented by the end of March, reports Al-Rai daily quoting informed sources.

They explained that these letters came from agencies in the textile, accessories, perfumes and restaurant sectors. The sites that will be vacant are huge. In some complexes, the rented sites that will be vacant are of size 1,000 square meters.

This will in turn negatively affect the real estate sector this year. The sources indicated that the managements of those complexes have already started promoting the sites that will be vacant soon, stressing that re-renting these sites will not be easy due to the current troubling conditions facing the real estate sector.

Meanwhile, Secretary of Real Estate Union Qais Al-Ghanem said a number of companies recently reduced the number of their branches and their employees due to fall in rate of consumerism in the society. He indicated that these companies rent strategic sites that are capable of ensuring profits, and also depend on earnings from strong branches to compensate for the loss of weak branches. Al-Ghanem stressed that market conditions have changed recently and companies are re-evaluating their presence in different areas. He revealed that many of them decided to close down branches that are not making profits.