Dubai construction firms are stepping up plans to expand into other Gulf markets less badly hit by the property downturn, it was reported on Tuesday.
Gulf states such as Qatar and Saudi Arabia where government have expansionary budgets were the places of choice for Dubai’s construction companies, reported UAE daily Emirates Business.
The sentiments come amid a massive property slowdown in the emirate, as a result of the global economic crisis, with as many as 53 percent of construction projects, worth $583 billion, on hold across the UAE, according to industry estimates.
“Saudi Arabia is definitely the place where growth is going to be sustained for the next two to three years,” Saleh Muradwiej, an executive director at Dubai contractor Drake & Scull, said at a construction meeting in UAE capital Abu Dhabi.
Drake, which specializes in mechanical, engineering and plumbing businesses, was in talks to buy companies in Saudi Arabia and Qatar and would examine three to five opportunities in the next two to three months, he added.
“It will be difficult to pick up additional work in 2010 to 2011 so we are finding ways to find work outside of our immediate geographical area,” said Riad Kamal, chief executive of Arabtec Holding, the UAE’s biggest construction company.
“We are looking at Saudi and Qatar. Negotiations are ongoing,” Kamal said at the conference, where he also revealed to Arabian Business that job losses were on the cards for the company this year.
Earlier this week it was revealed that a number of construction companies had bulk-booked flights for 20,000 Indian labourers to b e taken out of the USE – either to go home on long-leave or to be redeployed on other projects.
However, the UAE government has so far been able to give official figures as to how many people working in the construction industry have lost their jobs.
Top global oil exporter Saudi Arabia may not be hit as severely as Dubai because it dwarves its neighbors, boasting a 25 million-strong population to sustain demand, executives said.
Meanwhile, the economy of Qatar, the world’s biggest exporter of liquefied natural gas, is set to expand 10 percent in real terms this year, the minister of state for energy and industry said this month.
“There is a huge opportunity in Saudi Arabia for housing, a real demand for middle-class housing,” said Khalid Al-Zamil, managing director of strategic planning at Saudi Arabia’s Zamil Group.
Building companies with cash are also looking at taking advantage of between 30 and 70 percent drop in the rpice of building materials, added Ali Kolaghassi, vice-president of privately held Saudi Oger.
“It is time to take advantage ... Yes, there is a major slowdown in sales but this enables opportunities for developers who are solid and not leveraged,” he added.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.
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