By Andy Sambidge
Burj Khalifa cited in study as example of construction being followed by financial downturn
The construction of enormous skyscrapers has an "unhealthy" link with looming financial crises and investors should therefore keep a close eye on China and India, Barclays Capital has said.
It cited the Burj Khalifa as one of four examples where the construction of major landmark building have been followed by major economic problems, AFP reported.
China is currently the biggest builder of skyscrapers, while booming India is constructing the second largest tower in the world, the group said in its latest annual Skyscraper Index survey.
"Our Skyscraper Index continues to show an unhealthy correlation between construction of the next world's tallest building and an impending financial crisis - New York 1930; Chicago 1974; Kuala Lumpur 1997 and Dubai 2010," Barclays Capital said in a report.
At more than 800m and 162 floors high, the Burj Khalifa is the tallest building and the tallest free-standing structure in the world.
It boasts more stories than any other building on the planet, is home to the highest-occupied floor and has the world’s highest outdoor observation deck – situated on the 124th floor.
Barclays Capital said: "Often the world's tallest buildings are simply the edifice of a broader skyscraper building boom, reflecting a widespread misallocation of capital and an impending economic correction.
"Investors should therefore pay particular attention to China, today's biggest builder... and India, which with just two completed skyscrapers, now has 14 skyscrapers under construction."
Barclays Capital also warned of a "bubble" in China, whose property boom has been powered by cheap liquidity.
The bank also said India was set to experience its largest boom in skyscraper construction.
"China is not alone in the growth of its building bubble ... India it seems is playing catchup," it said.For all the latest construction news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.