SM Syed Khalil, group executive director, Ilyas & Mustafa Galadari Group, discusses the development of the City of Arabia project and the future of Dubailand.
What is your opinion about the market downturn?
I think there is a lot of negative publicity going around. Those projects that have already started have not been stopped; maybe there will be some kind of delay due to the economic situation, which has affected everyone, but no brakes are going to be put on Dubai's construction market, that's for sure.
When do you think the situation will improve?
Dubai offers a lifestyle that very few cities do and I feel confident that it will bounce back soon. But, projects won't be announced everyday as was the case earlier. A conservative, practical and pragmatic approach will prevail. Speculators will disappear from the market and the real investors will remain.
Has the City of Arabia project been affected by the slowdown?
We are going according to plan. The Mall of Arabia will be ready and open by 2010.
This must have affected development and developers?
For a focused developer, the situation will remain unchanged. For a developer who has taken on too many projects and has indulged in cross financing, the situation might be tricky.
Has there been anything positive that has come out of this downturn?
It is a difficult situation over all, but yes, it has turned into an advantageous situation for us. When we were constructing earlier, costs were rising, contractors were not available and there were a lot of problems.
Today it is the other way around, contractors are free, we are getting better prices and our construction costs have been trimmed down. The current situation will work to the advantage of the developer.
What is going to be the future of Dubailand?
With the current situation, the focus will shift on fully developing Dubailand. A number of projects that are being constructed in the area such as Falcon City and the Villa project are going ahead as planned. By 2012 to 2013, Dubailand will be a substantial residential and leisure development.
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