More than 400 projects with a total value of over $300bn had been placed on hold or cancelled altogether in the UAE, according to a new report on the construction sector released on Tuesday.However, stability would begin returning to the Gulf state’s construction sector this year, with signs of recovery emerging during 2010 as cash flow shortages eased, according to the report by Dubai-based research house Proleads Group.
“From our cash flow projections for the industry, we see the UAE construction market beginning to stabilise at current levels and showing some signs of recovery during 2010,” said Emil Rademeyer, director of Proleads Global.
Although a slowdown had cut the number of new projects launched since mid-2008, the UAE remained one of the most active construction markets in the world, with more than 750 projects under construction and 450 completed recently, it said.
The commercial and retail sectors had seen a reduction in new construction projects being started, with education and healthcare projects being placed on hold more often than in the past.
A slowdown was also hampering the leisure and entertainment construction sectors, along with an increasing rate of cancellations in the residential sector, the report concluded.
But multiple projects in several sectors were still scheduled for completion up to 2011, with most set to be finished in 2010.
A liquidity squeeze combined with slackening demand within the UAE’s real estate sector caused by the global economic downturn has led to a dramatic reduction in new building projects and delays or cancellations to existing developments.
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