Posted inOpinion

Should Lusail be your first choice as a home buyer?

Lusail is an emerging metropolis offering a unique blend of sustainability, luxury living, and a thriving business environment, attracting residents and investors, believes Ahmad Al-Khanji, CEO, Hapondo

Lusail: A rising star in Qatar’s skyline

Located roughly 16 kilometres north of Doha, Lusail City is one of the region’s most ambitious projects (a lesson on how to build a new city in the 21st century).

Lusail, at 38 square kilometres, is more than the size of Macau and just smaller than the European country San Marino. It is a self-contained city of 19 districts and an embodiment of Qatar’s National Vision 2030, planned to be the home of 200,000 residents and the place of work for 170,000 people.

A flagship project of Qatari Diar, the construction of Lusail began in 2006. Sixteen years later, Lusail hosted the FIFA World Cup Qatar 2022 championship inside the uniquely designed Lusail Stadium, with the winning Argentinian team parading victoriously across Lusail Commercial Boulevard.

Lusail Stadium

From an aeroplane, it is not difficult to spot Lusail’s landmarks—the iconic and crescent-shaped Katara Towers (home to Fairmont and Raffles hotels) in Marina District; the Lusail Plaza Towers, the tallest buildings in Qatar, located in the Commercial Boulevard; Lusail’s four man-made islands collectively known as Qetaifan Islands; and Place Vendôme Mall, one of the largest in the Middle East.

Lusail is as futuristic and sustainable as a city can be. It was the first in Qatar to endorse the Global Sustainability Assessment System (GSAS) principles to rate all buildings, which means all its buildings have at least a minimum of 2-star GSAS rating. Additionally, around 17% of the total land area has been allocated for landscaping and open public spaces. Among the biggest in the world, the Lusail district cooling system has been designed to save 65 million tonnes of carbon dioxide annually.

The evolving real estate market

The primary residential areas in Lusail include Fox Hills and Marina District, and many other districts are emerging. Fox Hills features low-rise apartments and villas, while Marina District is a rising central business district with a significant concentration of office and commercial buildings.

In Q4 2023, apartment rents decreased in both Fox Hills and the Marina District. The median price in Fox Hills dropped from $1,650 in Q3 to $1,565 in Q4, with the price of a two-bedroom apartment falling to $2,060 from $2,660. In the Marina District, the median price for a one-bedroom apartment decreased from $2,360 to $2,130, while a two-bedroom apartment dropped from $3,090 to $2,865.

Master bedroom

These pressures, brought by an increasing residential supply, have only made Lusail irresistible to residents looking for new places to live. Rents in Fox Hills and Marina District are now more affordable than the two other prime apartment markets, The Pearl and West Bay, where the one-bedroom apartment median rents were at $2,335 and $2,610, respectively, in Q4 2023.

There are other reasons why people will want to move. Lusail feels as much an extension of Metro Doha as it is a new city, seamlessly connected through wide highways and the metro; the train ride between West Bay and Marina District takes roughly 10-15 minutes. Within Lusail, a system of trams brings people to different districts.

Marina District;

The population in Lusail is gradually increasing, brought by the relocation of companies and government offices from Doha, the rising number of apartments and villas in the area, and expanding retail and entertainment activity. In addition, Place Vendome Mall is already one of Qatar’s favourite shopping destinations. Recently, Meryal Waterpark has opened in Qetaifan Island North, boasting the world’s tallest water slide nearly as tall as Big Ben.

Lusail: Your money’s worth

Lusail is among the select areas in Qatar where foreigners can own freehold property. Investors buying a minimum of $200,000 grants temporary residency, while an investment of $1 million entitles a permanent residency. Recently, Qatar also rolled out a golden visa program for entrepreneurs and talented individuals.

Lusail has become the top location for apartment acquisition searches in Qatar, according to the Q4 2023 ranking. The residential investment options in Lusail are diverse, with various off-plan and completed developments available in Fox Hills, Marina, Waterfront, The Seef, and Al Kharayej districts. New residential projects such as Voya Tower and JMJ Waterfront Residences have been recently announced in the Waterfront District, offering a total of 291 units for potential buyers.

An architectural marvel in the city centre

According to our data, the gross rental yield for a one-bedroom apartment and two-bedroom apartment in Fox Hills is 4.7%. In comparison, a one-bedroom apartment in the Marina District has a rental yield of 8%, while a two-bedroom apartment in the same area yields 9.2%.

It is particularly interesting to watch how Qetaifan Projects’ Qetaifan Island North (one of the islands in Lusail) is taking shape. The island holds great promise as a prime residential and leisure destination, and the next wave of super-prime developments in the Middle East will be in this area. Les Vagues is a prime project of Dar Al Arkan and Qetaifan Projects with world-renowned designer Elie Saab. Last year, Qetaifan Projects and JMJ announced the development of several mid-rise multi-use buildings to be designed by Zaha Hadid.

As this new city continues to unfold, it is prudent to explore investible opportunities while it is still early.