Emaar chairman Mohammed Alabbar, the developer behind the world’s tallest tower, has admitted his forecast in January 2010 that Dubai’s property sector had hit bottom was “wrong”.
In an interview published in today’s Arabian Business magazine, Alabbar concedes that the outlook for Dubai’s embattled real estate market remains unclear.
In January 2010, asked whether the property market had bottomed out, he said; “Without a doubt, without a doubt.” He later suggested the market would pick up within two years.
“Maybe I was wrong,” he told Arabian Business. “We underestimated how many [flippers] were out there. But it’s human nature. Everybody wants to flip and make money; it’s not against the law. It happened in America, it happened in Singapore. It’s just the percentage of flippers here was just huge.”
Asked whether he believes the property sector had now bottomed out, Alabbar says: “No I don’t think so. A year ago I thought two years. Today I would say it’s not clear.”
Property prices in the emirate declined more than 60 percent from their 2008-peak amid a global economic crisis that caused lending to dry up and speculative demand to decline, Deutsche Bank AG said in February.
Investment bank Rasmala said in March that house prices across the UAE were set to decline a further 25-30 percent over the next two years due to a rising oversupply of property.
The developer behind the world's tallest tower posted a 45 percent drop in profits in the first quarter to $115m, with revenues falling by 31 percent to $540m.
Alabaar, however, said the outlook remained positive for the state-backed company and hinted the developer was mulling a new project.
“I think the time has come for Emaar to roll to an incredible level. You know the story of the phoenix, it always rises up,” he said.
“Three years of difficult times are nothing in the life of cities and companies, so I think we are ready to go on another swing. Not all strategies work at the same time. We are working on something which we will announce soon.”
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