Emaar, Nakheel both no shows at Cityscape

Posted by: Hassan Al Hammadi Saturday, 19 September 2009 2:32 PM[UAE] - USA

The price of constrcution has fallen dramtically. It is cheaper to build a five bedroom villa in UAE than buying a one bedroom apartment. The massive supply of RE units has created a miss in the market. Home buyers mind changed. Leasing is cheaper than buying. Basically it is the time to lease. You can buy easilly a five star apartment in Burj Dubai Down Town for AED 950k why shall i go to Cityscape to buy properties. Manay many many. I think Real Estate has to change the way of managing RE business and look into new inititives and think of new innovative way of doing real estate business rather than working and focusing on the old way (Build and sell).

Posted by: Ananth Saturday, 19 September 2009 11:47 AM[UAE] - UAE

Yes it seems better sense prevailed at last with these giants and took the prudent decision.It is not the hype created but the real fundamental which was ignored by the RE segment which brought the present crisis.While retrenchment and redundancies continue in this segment what is absolutely necessary right now is to knock off the highly paid top management who contribute nothing except policy decisons and slash their pay packages by half and utilise the saving for payment commitment.Poeple who draws more than AED 50000 and above should accept a 30 -50 % pay cut to salvage the present crisis.They have to live with an austerity so that they can save thwe industry from further slow down.Marketing expenses like advertisement and other promotional activities should be done away with now.Dubai has the resilence to bounce back and till then people who loves this country should sacrifice their greed.

Posted by: Simon Saturday, 19 September 2009 11:22 AM[UAE] - Dubai

You miss the point completely... Its time for pay back and that will take years...easily 5-7yrs. Dubai does not have a 'productive manufacturing' GDP, like the USA, Dubai is and continues to be a consumer economy. No economy has ever come out of a recession/depression based on spending more money. The USA is not out of recession and neither is the UK...no matter what the 'official' figures say. All this unpresidented borrowing has to be paid back. All they have done is prolonged the inevitable and the real hurt is just around the corner, when all that govt spending/borrowing comes home to roost. With regards to Dubai...we have to turn away from the consumerism GDP which will take years to achieve. If Dubai relies on consumerism we have to wait for the rest of the world to come out of their recessions before we benefit or make Dubia a very cheap place to visit...like 6-7yrs ago. And thats my point...returning to what made Dubai attractive as a shopping and holiday destination. Forget the 'expensive' tag line marketing...its back fired. Make Dubai affordable and people will return...based on 'value'...like 6-7yrs ago. Sure there will be companies who can't afford this strategy...they will fall by the wayside...but Dubai has gone too far. Its cheaper to shop in Londons 'label' shops than it is here...that speaks volumes. A GDP based on solid growth will attract new investors...real investors, not short term speculators. Business plans used to be based on a 5yr projection...not 12mths like used to happen here. Lastly...the property industry is a good 5-7yrs away from getting to a 'healthy' level again. It will never get back to the stupid days of 2007/08 but it will go on cos life does. There will be investors because there always is...just on a smaller scale. When prices fall another 30-40% from where they are now and the banks lend at respectable interest rates...the 'local' market will begin to supply the buyers. Until a 3bed in the marina comes down to 1.2-1.4mil the local market won't buy up the surplus inventory. Until the likes of the springs type 4M/E comes down under 900k, you won't get a bouyant market. Its a long haul back to reality...but as i said...life goes on...deals get done at all levels...but until everyone forgets the greed of yesterday, Dubai will never recover. Investors are always around...they just have to see value before they return...there is NO value in Dubai property market right now...to be honest, there is NOTHING and economic realities that can under pin a property market in Dubai right now...the worst is yet to come!

Posted by: Kutty Saturday, 19 September 2009 12:09 AM[UAE]

Simon, life will go on minus the investors. Do you think that someone in right mindset would every buy property in Dubai? Keep dreaming those birds have flown away and are not coming back. Also,do you think their integrity will come back after the meltdown ? and they will give what was promised ? Damage is beyond repair.

Posted by: Simon Friday, 18 September 2009 8:39 PM[UAE] - Dubai

The fact that Emaar and Nakheel have both declined to be present at CityScape speaks volumes. Forget the PR talk and excuses as to why they are not there...what it points to is the fact that they expect NO BUSINESS to come by being there...international or local for that matter. That speaks volumes. If the biggest players in the region are not at their own, Dubai's, show case event...it means they expect the RE industry to be in very bad shape for a longtime to come and with little hope in the year 2010 of it turning around. All the measures Emaar and Nakheel have taken in redundancies/entrenchments etc tell us that they do not believe in a near future turn around, be it 1-2yrs. Therefore you can expect further rent declines and property price falls within the nxt 3-6mths as more and more inventory comes on line. Life goes on, sales will be done...just not in the volumes of old. There are too many variables that will not allow this RE market to bounce or even walk back into shape. It'll take 5-7yrs for things to come right again which is a real positive for Dubai because those that stay will be adding to the economy and building something strong. What Dubai does NOT need is a return to the past greed and fast days of making money. It destroys integrity and society...something that takes time to build is backed by strength and can most times weather will in bad times.