Print
Email
Discuss this article ( Comments)
Qatar has started a QR20bn riyal ($5.5bn) project to rebuild along traditional lines the inner capital of the world's biggest liquefied natural gas exporter, an official said on Sunday
DOHALAND, a unit of non-profit Qatar Foundation created by the Gulf Arab state's emir, plans to rebuild a 35 hectare area in the heart of Doha over five phases ending 2016, said Issa Al Mohannadi, the company's CEO.
Mohannadi said companies doing design work for the first phase included Britain's Allies and Morrison and US-based Burns & McDonnell.
He said some construction contracts were also awarded for the phase which is to be completed by February 2012.
The first phase is expected to cost about QR2.2bn which is being footed by Qatar Foundation, he said, adding the funding of further phases was being studied.
"The main objective is to create an endowment for Qatar Foundation that generates profit. Total reliance on oil and gas income is risky," Mohannadi said.
"We also want to create something Qatari rooted in the past and at the same time in tune with reality and globalisation."
Qatar, which has the world's third-largest gas reserves, is investing heavily on real estate, financial and other projects to help boost growth and curb reliance on oil and gas income.
At the end of March 2009, around 191 construction projects were under way in Qatar, with a total value of $82.5bn, Dubai-based research firm Proleads said in April.
The area will include residential units, offices, hotels, schools, a tramway and other facilities.
The first phase of the project includes the demolition of some areas, which has already started, and the expansion of some government buildings.
DOHALAND is counting on rental income to generate profit from the project by leasing units to Qataris and expatriates.
"You've got to have a rental cushion. It enhances your return on investments by diversifying revenue stream and mitigates overall property risk," said Saud Masud, senior Middle East and North Africa property analyst at UBS.
"This is in comparison of the Dubai model, where there is a bias to property sales, which works in good times, but makes it challenging in a downturn."
The once-booming property market in Dubai, has been hit by the global economic crisis with prices falling 41 percent in the first quarter, property consultant Colliers said in a report.
Qatar house prices have fallen as much as 30 percent in the last six months due to the global slowdown, but lingering demand for property will limit price weakness, real estate services company Jones Lang LaSalle, said earlier this month. (Reuters)
