The development of Dubai Properties' 200 billion-dirham ($54.4 billion)megaecoproject will not be impacted by soaring construction costs, the company's executive chairman said on Tuesday.
Labour and raw material costs have soared in the UAE over the last year due to record high oil prices and the falling value of the US dollar - to which the dirham is pegged - putting further pressure on developers already struggling to finish projects on time and on budget.
Mohammed bin Rashid Gardens, announced earlier this month, will be spread over 82-square kilometres between Al Khail and Emirates Road and include four built-up clusters as well as huge areas of greenery interspersed with large lakes and canals. RELATED: Dubai unveils $54bn eco real estate project
However, Hashim Al-Dabal said he was not concerned with current market issues such as rising costs.
“There are always big challenges when building in Dubai, sometimes its supply and demand or prices going up or location issues. But there is always a solution, we worry about the market as a whole, not it terms of just one cost area,” he told ArabianBusiness.com on the sidelines of a press conference announcing details of the project.
Al-Dabal said Dubai Properties would finance the initial work on the project and seek outside investment later on in its development.
"Here we will use a two-stage strategy where the infrastructure will be funded by the company... later on we will engage other developers and market investors for another source of funding," he said.
The four clusters, or houses - themed around wisdom, nature, humanity and commerce - will each have an "iconic" building at their centres, but Al-Dabal ruled out joining Emaar Properties and Nakheel in the raise to build the world's tallest tower.
“The icon will not necessarily be something like the tallest building but an iconic building that will be the theme of the house," he said.
"It won’t be the tallest in Dubai, I’m not going to compete with someone on height.”
The project's biggest cluster will be the House of Nature. This will include parks, flower gardens, recreational clubs, a zoo, hotels, environmental labs and alternative medicine and herbal healing clinics.
The House of Wisdom will include a library, international universities, history and science colleges and the Sheikh Mohammed Mosque.
The House of Humanity will include the Mohammed bin Rashid Al Maktoum Humanitarian and Charity Establishment, the Museum of Light, the Human Civilisation Museum and other charities such as Unicef.
The House of Commerce will include banks, financial services firms and insurance companies, as well as higher educational institutions that specialise in banking and finance.
Dubai Properties, part of state-owned conglomerate Dubai Holding, will oversee the project, which will be carried out in six stages. Initial work on the project has already begun, Al-Dabal said.For all the latest business 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.
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