Font Size

- Aa +

Wed 16 Sep 2009 03:02 PM

Font Size

- Aa +

UAE real estate hardest hit in region by global crisis

A total of 566 projects are currently on hold or cancelled, latest research shows.

The UAE’s real estate and construction sectors have been the hardest hit in the region by the global downturn, with a total of 566 projects currently on hold or cancelled, according to the latest report by Proleads.

However, the country retains an “extraordinary level of construction” with a total of 1,372 projects under construction or bidding, the Dubai-based research house says.

“While some of Dubai’s ambitious plans are among the UAE projects that have been dropped, the Proleads database shows a continuing high level of activity in the emirates which would be the envy of many economies elsewhere,” said Chris Speller, Cityscape group director.

The report, which is based on more than 3,000 Gulf projects valued at over $1.5tn, found that impact of the economic downturn had been less marked in other countries in the region.

Saudi Arabia has a total of 442 projects currently in construction or bidding, with 106 on hold or cancelled, while in Qatar, 124 are underway, with just seven cancelled and none on hold, the report says.

In Bahrain 148 projects are in construction with 54 cancelled or on hold.

The report says that Kuwait has 90 projects underway, and just 18 are cancelled or on hold, while Oman has 95, with eight on hold and none cancelled.

“In the worldwide shakeout, no region has been immune and, as a result, a strong element of realism has entered the real estate investment landscape,” said Speller.

Cityscape Dubai takes place between October 5-8.

Andrew 10 years ago

To quote the above article. 'While some of Dubai’s ambitious plans are among the UAE projects that have been dropped, the Proleads database shows a continuing high level of activity in the emirates which would be the envy of many economies elsewhere,” said Chris Speller, Cityscape group director' Firstly, can someone tell me what economy in the world would envy the one Dubai has at the moment? Secondly, holding an exhibition like Cityscape in Dubai at the moment is a little like rearanging the deckchairs on the Titanic. But then again I suppose it was only a matter of time before the spin started.

John 10 years ago

Ditto Andrew . . . Also, i have very little confidence in the actuals quoted. With reference to Speller's quote, i think the only strong element of realism that has entered the market is the shocking reality of how grave the situation really is. I would love to get people like Speller in a forum and ask some relevant questions as to the basis of their statements.

mark 10 years ago

Andrew, John, in my view you are looking short term. Take a step back and look at the big picture. Yes, Dubai has a large debt and real estate overhang which results from being blindsided by the global recession, and the excesses of the property speculation era. and this will take some years to clear up. However how many other places in the world are as attractive for business, with the rules about to get even better. And with real estate prices now having come down to a reasonable level this just improves the fundamentals for businesses looking to come here. No taxation, a central location within a stones throw of half the worlds oil reserves, full support from within the UAE who are financially one of the most secure in the world and continuing to produce more than 2 million barrels of oil daily. Dubai has also invested heavily in infrastructure to support the growth (roads, rail, bus, heathcare, power), and these are all factors businesses consider when moving into the region. For businesses and individuals UAE and Dubai is an attractive long term proposition and I see the future as positive. Even now in the short term, the streets are still busy. Look at the traffic and school waiting lists.. it is nothing like what was predicted. The summer exodus did not happen to the scale some folks were predicting, and new families are arriving. All IMHO.

carol wagner 10 years ago

Spin - Love your comment "Secondly, holding an exhibition like Cityscape in Dubai at the moment is a little like rearanging the deckchairs on the Titanic."

Ali 10 years ago

Mark, we all know Dubai is more competitive than almost any other Arab city. However please dont spout the "no taxation: nonsense as there are indirect taxes on many many things from "fees" to exorbiant telecom charges, to RTA fines "by mistake" which dont get refunded even in 6 months. So claiming there is no taxation tells half the story and is misleading

Ace 10 years ago

A very strong analysis Mark. N I would add the fact that there probably is no other state which can boast of Dubai's infratructure in the region and hence Dubai will remain the hub of the increasingly lucrative Middle Eastern market which more and more organizations would be looking to tap. So to all the doom n gloomers I say watch your words lest you be eating humble pie cos nothing is as good or bad as it seems at first.

Frank 10 years ago

I am totally agree with Mark comments. Many pictured a doom day and dark future for UAE and particularly Dubai, but you can see that hotels are fully booked with a lot tourists and local populations, parking still hard to get, restaurants are full, schools and universities are hiring more teachers, and then economy in Europe such as UK and US is getting worse. I predict by end of this year everything goes back to normal in UAE. Why UAE? Because UAE is a unique country in this region. Located in the middle of oil producing countries with a very open market, positive attitude towards businesses and enterprises, excellent communication and infrastructures, speedy customs compare to neighboring countries. Let us talk about reality and facts not emotions. How many of you wants to change your job and work & live in Bahrain, Saudi Arabia, Kuwait or Pakistan if you can stay in UAE, this is another reason that UAE is on the top in this region. It is a preferred place to open business, work, and having your family with you. By the way it is not my opinion it is 87% opinions of British, Germans, French, South Africans, Australians, Philippines, Indians, Pakistanis and Iranians.

SR 10 years ago

Spot on Mark, on your analysis. I think business is already starting to pick-up. But if anybody is expecting the real estate craze of 2007-08; you are dreaming!!!!

Denny 10 years ago

Mark has a point. Dubai does have stronger fundamentals than most places in this region...but it is in deep. It's not the end of the world, but it's nowhere near a proper recovery yet. Hopefully what will emerge will be a more humble economy, which listens, prefers moderate and sustainable growth over brash statements, status symbols and a scattergun approach to investment. The over the top Metro hype suggests there is still a little way to go but hopefully the listening will start soon. But it has not turned the corner yet, anyone who thinks hotels are full needs their head examined (and that considering you can get flights from the UK and a week in a 5 star for dh2800), the real estate sector probably still has a little way to fall. The restructuring of major govt owned companies, the lack of big players at cityscape and the lack of people coming through the door (I fly from the UK every month and see no more than 10% of the passengers getting off in Dubai) Overall Dubai will survive, and we can only hope 2.0 will be better.

Tom 10 years ago

I am totally agree with Mark comments. Many pictured a doom day and dark future for UAE and particularly Dubai, but you can see that hotels are fully booked with a lot tourists and local populations, parking still hard to get, restaurants are full, schools and universities are hiring more teachers, and then economy in Europe such as UK and US is getting worse. I predict by end of this year everything goes back to normal in UAE. Why UAE? Because UAE is a unique country in this region. Located in the middle of oil producing countries with a very open market, positive attitude towards businesses and enterprises, excellent communication and infrastructures, speedy customs compare to neighboring countries. Let us talk about reality and facts not emotions. ------------------------------------------- What school of Economics did you study at??? If Europe and USA are down there will be no-one going to Dubai to spend any money etc.... :-/