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Friday, July 31, 2009
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Wednesday, July 29, 2009
Dubai’s future domestic economy must focus heavily on expats and foreign companies, says leading UAE property developer
Get back to basics,’ Dubai urged
Dubai’s future domestic economy must focus heavily on expats and foreign companies, says leading UAE property developer
With the global economy going through one of the most challenging periods of economic stress in generations, Dubai’s future domestic economy must focus heavily on continuing to attract expatriates and foreign companies, says a leading property developer.
“I believe we will soon see the bottom of the current crisis but if we are to avoid a recovery like the boom and bust cycle of the recent past, Dubai must return to the basics which first put it on the map,” said Mohammed Nimer, CEO of mid-market development company MAG Group Properties.
“Dubai was hugely successful before the real estate bubble,” said the boss of a company with AED3 billion worth of construction projects in the United Arab Emirates. “As the Arabian Gulf’s most globalised economy, Dubai’s existence has been driven by its power to attract foreign direct investment and the resources necessary to make it work.
“Dubai, a once small pearling village with limited natural resources, led the region in declaring a tax-free, business-friendly environment, attracting outside investment and a large highly skilled expatriate population.
“The basic pluses for Dubai that brought them here have not disappeared in the financial and real estate crisis. Dubai’s geographical position will never change and it remains the primary hub connecting Asia to Europe. It also connects Asia to Eastern, Western and Southern Africa, as well as becoming a gateway from Asia Pacific to South America.
“Dubai’s infrastructure cannot be bettered by anywhere else in the Middle East. Jebel Ali is still the world's largest man-made harbour, the biggest port in the Middle East and home to 5,500 companies from 120 countries. Dubai international airport is the sixth busiest in the world by international passenger traffic and one of the busiest cargo airports in the world.
“What this emphasises is that Dubai’s dependency on the outside world cannot be ignored. The future domestic economy must focus heavily on expatriates and foreign companies and its business relationships with the rest of the world. Now, however, there must be greater transparency, tougher regulations to protect investors and a basic safety net on provisions for the expatriate community upon which the economy is dependent.
“We need to ensure that the UAE remains a safe and secure community and that its tax-free and business-friendly environment is strengthened. Population and employment are basic fundamentals which underpin the UAE economy and reforms which ensure growth are essential to maintain them.
“Solid fundamentals like these which lead to a sustainable recovery and affordable – not speculative - housing whether owner-occupied or rented, lie at the heart of the solution.”
In the shorter term, Nimer said there is still a large supply of new residential and commercial property to be absorbed by the Dubai market. Lower rents and values would ensure that the supply is taken up and “only then will the Dubai property market be stable,” he added.
Photo caption:
Affordable – not speculative – housing, whether owner-occupied or rented, lies at the centre of the solution, says Mohammed Nimer, CEO of mid-market property development company MAG Group Properties
About the MAG Group
The Dubai-based Moafaq Al Gaddah Group of Companies (the MAG Group) was established in 1978 and has grown into a multinational organisation with 18 offices in eight countries throughout Europe, the Middle East and Asia.
In the last five years the MAG Group Properties has invested in 12 properties at various stages of development across the residential, commercial and industrial sectors. The company focuses on projects that provide long-term benefits to investors and customers.
In total MAG has a property portfolio in excess of AED3 billion and was one of the first developers to create Escrow accounts for all of its projects, long before the Dubai Government introduced Law number 8. In October last year, MAG Property Development was awarded ISO 9001 certification by risk management company Det Norske Veritas (DNV). MAG still remains one of the few developers in the region to be accredited to that standard.
Tuesday, July 28, 2009
UAE construction sector still ‘active’ by global standards
UAE construction sector still ‘active’ by global standards
New Proleads investigation assesses impact of economic crisis
on the civil building construction industry
Dubai, 28 July 2009: Despite the global slowdown, the UAE continues to be one of the most active construction markets in the world with more than 750 active projects in construction and 450 recently completed, according to a new report* by Dubai-based research house Proleads Global.
Although more than 400 projects with a total value in excess of $300 billion have been placed on hold or cancelled, (the rest either in study, planning, design or bidding), the report forecasts stability returning to the sector this year with some recovery in cash flow in 2010.
The study identifies a slowdown in new projects in the commercial and retail; education and healthcare projects being placed on hold more often than in the past; a slowdown in leisure and entertainment and an increasing rate of cancellations in the residential sector.
The Insights study provides statistics to back the anecdotal evidence of the impact of the slowdown. Insights United Arab Emirates: An Investigation into the Current and Future State of the Civil Building Construction Industry examines more than 1,900 projects with a total budget of more than $1 trillion.
The results of the most recent and detailed study of its type reflects the continuing impact of the economic crisis on the UAE construction market, including:
• A marked downward trend beginning in mid-2008 in the rate at which new projects are announced.
• A dramatic increase in the rate at which projects are cancelled since early 2009.
• An increase in the rate at which projects are placed on hold as well as the size between late 2008 and early 2009.
• Multiple projects in several sectors scheduled for completion up to 2011, with most in 2010.
Emil Rademeyer, Director of Proleads Global, said the aim of the study is to quantify the UAE civil construction market as accurately as possible, rather than simply relying on anecdotal evidence.
“It is vital to know how fast and by how much the industry is changing, not just for the industry and its suppliers but also for planners, governments and financial institutions,” he added. “Projects are always put on hold even during boom times but it is the rate at which it occurs that enables us to forecast when we might see an upswing.
“From our cash flow projections for the industry, we see the UAE construction market beginning to stabilise at current levels and showing some signs of recovery during 2010.”
* Insights United Arab Emirates: An Investigation into the Current and Future State of the Civil Building Construction Industry, is published by Proleads Global, price US$390. For further information, please visit www.projectsandleads.com
Photo caption:
“We see the market beginning to stabilise at current levels and showing some signs of recovery during 2010,” says Emil Rademeyer, Director of Proleads Global
About Proleads
Based in Dubai, United Arab Emirates, Proleads focuses on construction markets across 19 countries in the Middle East, North Africa and Asia. The Proleads online database contains over 8,000 active projects with a total value of more than US$6 trillion containing details of scope of work, ownership, budgets, schedules, companies involved, contact details along with the latest update of projects. A company profile for each project is available with senior management structures and project analysis. Proleads estimates the accuracy of its data at 90%.
Proleads also offers ProCost, an online cost tracking model to calculate and monitor costs in the construction industry; ProScope, a consulting division focusing on supply chain optimisation, planning and engineering; and ProSpec, a free online product specification guide providing details of thousands of products supplied to the construction industry. For more details, please visit www.projectsandleads.com
