Readings: Revenue sharing with retailers, Oil targets, Dubai bubble
- Business Standard: Realty developers may go for revenue sharing model to promote margins
Realty developers are likely to go for revenue sharing arrangements with retailers to protect margins and minimise risk due to declining retail rentals and sales.
. . . when the revenue sharing model was first mooted around 2002-03, not many developers were willing to accept it. However, the recent downslide means that mall-owners need retailers to survive in their business and are therefore becoming open to new ideas.
Would be useful to know what % revenue share the mall developers are willing to go with.
OPEC deferred a decision on whether to cut production again this year by two weeks to gauge the impact of previous cuts, as it seeks to push oil prices back up to $75 a barrel.
In a statement after yesterday’s meeting in Cairo, the group warned that oil demand will be “much lower” than expected a month ago. Prices have continued to slide even after the group agreed on Oct. 24 to cut production by 1.5 million barrels a day starting Nov. 1.
Eleven years ago, OPEC members bickered over quotas as oil prices slid 28 percent in 10 months amid the onset of the Asian financial crisis. At a meeting in Jakarta in November 1997, they raised quotas, even as economic turmoil in Asia was slowing demand and prices fell another 44 percent by December 1998 to a low of $10.35 in New York.
No control on the way up, no control on the way down.
- Economist: Dubai - Has the bubble burst?
. . . the debate moves from whether the Dubai property bubble will burst to just how bad it is going to get. Some nervous bankers think property prices could fall by 80% or so in the next year or so.
. . . worried banks are sharply reining in their mortgage lending. A series of arrests of senior businessmen as part of a fraud investigation is also making people twitchy. There is even talk of a coming “Gulf Enron”.
Several GCC economies will go into budget deficits next year for the first time since at least 2002, including Saudi Arabia, whose budget is based on oil at around $50 a barrel but excludes the cost of Saudi Aramco’s massive programme of capacity expansion.
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