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Tuesday, 24 November 2009 20:53 UAE time

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Hidden gem

by ArabianBusiness.com staff writer  on Saturday, 27 October 2007
Wonderland: Rakeen recently launched the US$1.8bn Al Marjan Island at Cityscape Dubai.

The Middle East has redefined the expression ‘boom times'. Driven by record high crude oil prices that reached US$90 on New York's Nymex exchange last week and the planet's incessant demand for black gold, Gulf countries have billions of dollars in reserve waiting to be deployed and invested across the world.

We have all heard of the leaders in this race to diversify investments in Africa, Europe, the US, Russia, India and China to name a few. Dubai, Abu Dhabi, Qatar, Bahrain, Kuwait and Saudi Arabia are all on the frontline of billion-dollar deals, but what about the rest of the Middle East?

Rakia plans to invest US$15bn across various sectors throughout the emirate over the next five years.

One of the UAE's smaller, but equally vital emirates is not only riding the investment wave, but carefully implementing a structured plan to develop the area into one of the must-see in the GCC.

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Ras Al Khaimah, on the Northern tip of the Arabian Peninsula is located 45 minutes by car from Dubai and is possibly the UAE's most picturesque emirate. Nestled between the Hajjar Mountains on the East and the Arabian Gulf on the West, it shares its mountainous borders with the Sultanate of Oman. Under the guidance and vision of Sheikh Saqr bin Mohammed al-Qassimi and Sheikh Saud bin Saqr Al-Qassimi, Crown Prince and Deputy Ruler of Ras Al Khaimah, the emirate is predominantly involved in industry, energy, tourism and property inviting businesses into its freezone, boosting its oil plans, and developing the many sites of cultural interest it has plans for dozens of hotels, resorts, malls and infrastructure projects.

Property

Covering an area of 1700 km², RAK, as it is more commonly known, has a population of just under 200,000 people. This figure, however, is expected to leap dramatically in the near future with a large number of key property projects either underway or in the planning process. The main companies involved in the emirate's transformation include the state-owned Ras Al Khaimah Investment Authority (Rakia), Rakeen, RAK Properties and Khoie Properties, all with a series of multi-million dollar projects in the pipeline.

Rakia plans to invest US$15bn across various sectors in the UAE emirate over the next five years, the company revealed at Cityscape Dubai two weeks ago. Rakia CEO Khater Massaad, who is also the Crown Prince's principal advisor, says the investment will go towards developing Ras Al Khaimah's infrastructure, and making the emirate more attractive to foreign investors - a message he and RAK's rulers are very keen to get across. Massaad highlights sectors such as real estate, tourism, power, and industry as key investment opportunities.

Ras Al Khaimah, like the other UAE emirates, is making a big push to attract foreign investment, in order to fuel its rapid economic expansion with Rakia already investing US$2bn in the last two years.

Projects currently under development in the emirate include the US$8bn RAK Financial City, man-made Al Marjan Island, Jebel Jais Mountain Resort and Mina Al Arab residential community.

Rotana and Marriot properties are also due to come on line in 2008, with the Hilton Mina Al Arab Resort following in the first quarter of 2010.

Massaad adds that he expects even more growth in all of RAK's target markets, and that the final quarter of 2007 will see aggressive marketing campaigns in Germany, Japan, Russia and the UK.

RAK Tourism recently released the RAK City Tourist Map to provide visitors with information about the emirate's key attractions, and the tourism authority is working with the government to preserve a number of sites and make them more accommodating to tourists.

RAK Properties is also gearing up for further expansion with plans to sell up to US$2bn of Islamic bonds early next year to finance new projects.

A lingering credit squeeze triggered by defaults on US home loans has prompted many issuers to shelve or postpone borrowing plans in July, with bankers expecting the majority of issuers to wait until early next year to hit the market. This hasn't deterred companies in Ras Al Khaimah however, with Rakia following RAK Properties by announcing a benchmark size Sukuk sale worth US$500m to be held by the end of this year. Cityscape has been a great event for RAK Properties in the past with its Mina Al Arab and Julfar Towers projects attracting local, regional and international investors during the three-day exhibition.

The US$2.72bn Mina Al Arab and the US$136m Julfar Towers sold several units and received numerous inquiries from investors looking to invest in the northern emirate's projects. Rakeen also exhibited its projects at Cityscape including its US$327m Bab Al Bahr resort, which will be located on Ras Al Khaimah's US$1.8bn Al Marjan Island. Bab Al Bahr is Marjan's inaugural development project, Rakeen's man-made coral-shaped atoll that extends impressively four kilometres into the Arabian Gulf.

The development includes a four-star deluxe hotel, time-share apartments, freehold residential apartments, a shopping centre and an office tower, offering occupants 360-degree sea views and open private beachfronts. On completion in the first quarter of 2010, Bab Al Bahr will feature five residential buildings and a total of 710 residential freehold apartments broken into 110 studio apartments, 290 one-bedroom apartments, 220 two-bedroom apartments and 90 three-bedroom apartments.

Rakeen is also involved in a host of other upscale projects in Ras Al Khaimah, including RAK Financial City, Gateway City, RAK Convention Centre, Jebel Al Jais, Banyan Tree Resort, Azure Hotel and Dana Island. The company is also developing extensive mixed-use projects internationally such as Isfahan, Iran; Tbilisi Uptown and Tbilisi Heights in Georgia; and Kinshasa High Rise Congo in Africa.


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