Dubai property market needs more than Nakheel aid

Posted by: Telco guy Saturday, 3 April 2010 1:24 PM[UAE] - UAE

@Dan, when was last time you jumped into a taxi and asked to go Ibn Batuta Mall to be siad, i do nto know where it is. or to JBR? For me the answer are yesterday and 4 days ago, respectively. So much for "new" taxi drivers. Do you realize that you are suggesting to get rid of employees once they are trained and get new, untrained stuff? Do you really believe this will improve service levels? The real issue here is a system with the wrong incentives and values that thinks that people are easily replaceable parts with no individual differences. In this region few respect work nor quality, therefore no interest in training/keeping/retaining best stuff. About your "buy property cheap" idea, I am sorry to inform you there is a credit crunch going on in the world right now. I doubt you will find anyone willing to finance such a proposal unless prices are extremely cheap. And that will not get hte banks out of the hole they are. Besides, lets be realistic, what is Dubai's USP? Sun? Beaches? there are dozens of places with similar or better characteristics. Dubai's main driver was cheap shopping and that is gone. If you want to compete on price in the tourist market that is a really crowded place, and Dubai has a long way to go against mediterranean and caribbean places. If you think cheap tourists are the way out, I think you are wrong. Margins are thin there. If you want to go upscale then you need to size appropriately. From some of your local posts you seem to have a problem with too many South Asian in Dubai, and talk about "an increase in crime". Have you seen the cheap German, Dutch or British tourists in action? I suggest you tour my country beaches in summer to see what they bring? Do you think the attitudes displayed by them will not generate a backlash? You can try to compete with benidorn or try to be monaco. You will not be both. And the skills could not be more different.

Posted by: Ali Saturday, 3 April 2010 10:33 AM[UAE]

Unfortunately Dan's statements are either misrepresentations or outright false. I would like to find a single laborer out of the hundreds of thousands here that has brought his parents here as Dan is insinuating. I'd wager a months salary that not a single one has. Secondly, what world is he living in if he thinks "half the population" has no jobs? Again that number is likely to be less than 10%, its sad that people sought to misrepresent facts in order to push his warped agenda.

Posted by: Dan Saturday, 3 April 2010 4:05 AM[UAE] - Sweden

There is still a chance of getting out of this mess and saving some of all these investments. Let big travel companies buy (very cheap) all the empty houses to use for vacationing people. Make sure people get a very cheap vacation in Dubai compared to many other destinations so they keep coming back. If you want to bring in laborers from the sub continent, make sure they get a one time none renewable, max 2 years working visa and pay them well enough so they give good service. This way they will not bring family and parents to UAE and make it the overcrowded place it is today. Also put an effort into sending back all those (at least half of population) who are staying with no jobs and creating more and more crimes in order to make some money. If there is a limit to staying in Dubai, these people will not turn rude after being in UAE a few years, as most people in service industries are( taxis, hotels, restaurants and so on). You can clearly see the difference in politeness in a newly arrived taxi driver compared to one being in UAE a few years.

Posted by: Sergay MacAndrew Saturday, 3 April 2010 12:57 AM[UAE] - Scotland

The essence of the argument is time, i.e. how soon before Nakheel receives the promised funding and in turn how soon it is distributed in settlement of trade and supply contractors who are labouring under the millstone of long outstanding receivables. Will contractors immediately start work again on projects that are deemed deliverable and financially viable, without transparency as to when currency will change hands. I maybe confused, but my understanding was that government contractors were first in line, followed by the rest; with any firm with a total outstanding of up to 500,000 Dirhams or below to be paid off in full and others to receive 40 per cent plus a form of tradeable paper for the residual 60 per cent with some years before fruition? The debate perhaps is whether the grand payment plan, while undoubtedly a step in the right direction in the hearts and minds as opposed to the oustretched hands of most, is sufficient to kickstart the whole labour and cashflow system in the space of twelve months. This is essential in order to create a sufficiently expanded, employed population to occupy the units produced on completion. Another issue is that there is an entirely new executive team installed at Nakheel, who will presumably need to get to grips with the business, which projects proceed, who is getting paid what pretty quickly and have some say in the matter. After all one assumes that they will have to be able to live with their decisions longer term. How much time is that process likely to take? I am also mindful of the current duration of the discussions surrounding the potential Amlak Tamweel merger which has considerable bearing on any expanded working population being able to buy anyway. The first quarter was expected to yield an outcome and it has come and gone. From a Dubai property market perspective, that union has to produce the local equivalent of America's Fannie Mae and Freddie Mac if the Dubai Government is to assist the industry. However, the money has to be rounded up to underwrite any new entity and where will that come from given the extent of the funds being put up to settle maturing Islamic Bonds and resolve Nakheel's immediate difficulties. Putting real estate related residence visas aside the level of market confidence restored by the repayment plan can erode just as quickly if it is not physically implemented in a transparent and relativelyshort order timeline as is the case with the mortgage merger. Maintaining impetus is all!