By Shane McGinley
Tax-free park must compete with two million sq ft of office space to come online by 2012 in Dubai
Dubai International Financial Centre, the emirate’s tax-free financial hub, saw leased office space rise by 19 percent in 2010, but sees tough years ahead, a senior executive said Sunday.
The number of firms licensed to operate in the business park reached 792 in the same period, a rise on 6.3 percent on the first half, and 14.2 percent on 2009.
More than half of new firms were from North America and Europe, DIFC said. Around 45 percent were from the Middle East and wider Asia region.
Abdulla Mohammed Al Awar, CEO of DIFC Authority said despite a good year, the next two years would be difficult for the financial hub.
“There is no doubt that the road ahead remains challenging,” he told Arabian Business.
A key concern is the two million sq ft of office space that is scheduled for delivery in DIFC by third-party developers by 2012.
At present, occupancy levels across DIFC vary considerably. The park’s report found that occupancy rates in DIFC-owned office space remained around 95 percent.
Occupancy levels in non-DIFC third party developments, by contrast, average around 44 percent.
In a bid to attract new firms to open offices in the centre, DIFC last year announced it would slash rents and reduce the cost of setting up new companies.
The revised pricing structure included “revisions to office space rents as well as operational fees (visa services and registration fees),” DIFC said.
“We believe that there are still many untapped opportunities that our new strategy will position us to take advantage of,” Al Awar said.
The number of retail outlets in DIFC increased by 12.1 percent in the second half of 2010 to 83.
In a positive note for retail landlords, the occupancy rate in the second half of 2010 rose to 71 percent, up from 66 percent in the first half of 2010.
DIFC needs to stop giving spins (one key reason for its collapse ).Anyone who walks into DIFC,be it be the cafes/retail stores/etc can see the impact of the current market. Being transparent is the key to any Org' success. The spins have been the main reason why dubai has not been able to full fill the dreams of the vision that city still deserves.