However, Dubai is still a good place to live in the Middle East with the existing infrastructure and right atmosphere for business.
|UAE Construction Worst-hit in GCC|
| Issac John|
|17 September 2009|
DUBAI — As a result of the global economic crisis, the UAE’s once-torrid construction industry has cooled more dramatically than any other construction market in the GCC region. Even so, the Emirates are still seeing “an extraordinary level” of activity, with 1,372 projects either being built or in the bidding process, according to a report issued on Wednesday by the Dubai-based research firm Proleads.
Since the construction business began feeling the chill in late 2008, developers have put on hold or cancelled a total of 566 projects comprising 29 per cent of all those planned across the UAE’s office, hotel, residential and retail sectors, Proleads said.
“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 Chris Speller, Cityscape Group Director.
The report was based on a study that Proleads made for organisers of the Cityscape Dubai property exhibition set to take place at the Dubai International Exhibition and Convention Centre on October 5-8 2009.
With total projects worth $900 billion, including those put on hold or cancelled, the UAE accounts for 60 per cent of the $1.5 trillion of total projects in all member countries of the Gulf Cooperation Council. The UAE accounts for 46 per cent of the GCC’s total of 3,000 projects, the report said.
While some of Dubai’s major property plans are among those that developers in the UAE have dropped, the Proleads database shows a continuing high level of activity in the Emirates that would be “the envy of many” economies elsewhere, Speller said.
The study shows that a total of 340 commercial projects are under construction or in the bidding process, with 147 cancelled or on hold. In the hospitality business, 288 projects are under construction or bidding, with 118 cancelled or on hold. A total of 495 residential projects are being built or in bidding, with 217 cancelled or on hold; in retail, 249 projects are in construction or bidding, with 84 on hold and no cancellations.
The impact of the economic downturn elsewhere in the Arabian Gulf has been decidedly less severe, the study said. The report was based on a survey of thousands of projects across the Gulf, each worth at least $10 million.
Of projects worth more than $387 billion in Saudi Arabia, 19 per cent of the total number have been cancelled or put on hold. Kuwait has total projects worth more than $114 billion, with 17 per cent cancelled or on hold. Oman has total projects worth more than $38 billion, of which 8 per cent are on hold and none cancelled, while Bahrain has $36 billion of projects, with 27 per cent cancelled or on hold, Proleads said.