Emaar hires consultant to review overseas real estate projects

Dubai’s state-backed property developer has projects in Africa, Asia and Middle East
Emaar hires consultant to review overseas real estate projects
Emaar posted a 45 percent drop in first-quarter net profit last month, missing analysts’ forecasts, as revenue dipped and losses from associate firms rose
By Reuters
Thu 05 May 2011 02:26 PM

Emaar Properties, builder of the world's tallest tower, has
hired consultant McKinsey to conduct a strategic review of its international
operations, sources familiar with the matter said Thursday.

The McKinsey review mainly relates to the developer's
property segment said two of the sources, speaking on condition of anonymity.

It will cover Emaar's foreign units which span the Middle
East, Africa and Asia, in countries like India, Egypt and Saudi Arabia. The
developer is expected to announce the plan later this month.

A spokesman for Emaar was not immediately available for
comment. A McKinsey spokesman declined to comment.

The review may prompt Emaar to focus on expanding its
hospitality business - it operates malls, hotels and golf resort - in key
emerging markets, such as China and Brazil as well as Africa.

The developer, whose hospitality and mall business has been
a key income driver after the property bust, has said it plans to expand its
hotel brand globally.

Italian designer Giorgio Armani partnered with Emaar to open
his first hotel at Dubai's Burj Khalifa last year and the company plans more
hotels with the designer. The second property is slated to open in Milan in
2011.

Shares in Emaar, about 30 percent owned by the Dubai
government, closed down 1.54 percent on the Dubai index.

The builder's operations in its Indian joint venture came
under fire after it built the Commomnwealth Games Village, a development
plagued by shoddy construction and delays. The developer was penalised by
Indian authorities who cashed its $45m bank guarantee.

In March, Emaar denied a media report that the company is
valuing its Indian joint venture's assets in preparation for an exit or partial
sale.

Last year, it dropped plans for a $600m mixed-use resort
project in Indonesia, first announced in 2007 before the global credit crunch
and property slump.

Emaar posted a 45 percent drop in first-quarter net profit
last month, missing analysts’ forecasts, as revenue dipped and losses from
associate firms rose

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