Tme: Dubai still seems to be the hub of regional investment in real estate although other Gulf destinations are undertaking ambitious plans. Which of these cities are serious contenders, if any? I think the main thing to remember here is that Dubai isn’t really in competition with the other emirates or Gulf countries. Each of the Gulf’s emerging real estate markets offers its own unique advantages. Also, remember that Dubai has a good few years on most of the other Gulf real estate markets and, as such, would naturally lead the pack.

An investor may have several different interests in a particular market, influenced by many factors beside simply the returns he can expect from a particular piece of real estate. This is why, although the Dubai market continues to grow at a very healthy rate, other markets in the region are catching up fast. There has been an enormous amount of interest and growth in the Ajman-Umm Al Quwain region, for example, with the focus being primarily on lifestyle developments which cater to the needs of those who hope to escape the metropolitan life

and want to set up home in a more relaxed environment. Other major developments are springing up in areas where business is taking off on a large scale. Sharjah, for instance, is a major logistical centre and gateway between East and West, which has resulted in significant growth of the real estate market there. Similarly, changing investment climates in KSA and other Gulf countries have begun to attract international attention and investment. None of these, however, take anything away from Dubai’s booming property sector. n

And from Abu Dhabi. . .

As the population of the UAE increases so too do the facilities required to keep these, mainly expatriate residents, happy. Neil Mitchenall, chairman of the retail and leisure specialist Lunson Mitchenall, is concentrating on development in Abu Dhabi where there is no sign of any drawdown in the market. I have a confession to make, "the speed and sheer enormity of the development programme in Dubai has always worried me but what has been achieved is quite outstanding – the product of enormous ingenuity and drive. But for all that, I still have this niggling concern in the back of my brain that near infinite supply needs near infinite demand. Unlike Dubai where “all comers” are being enticed, Abu Dhabi is concentrating on the introduction of world class cultural centres. By 2012-13 there will be the Louvre Abu Dhabi Art Gallery (architect Jean Nouvel), the Sheikh Zayed National Museum (Lord Foster), The Guggenheim Abu Dhabi (Frank Gehry), The Performing Arts Centre (Zaha Hadid) and The Maritime Museum (Tadao Ando). The common theme of “only the best will do” is very evident! Abu Dhabi has been fortunate in seeing the successes and errors Dubai has experienced and has the advantage therefore of being able to make a good attempt at avoiding some of the pitfalls. For example, £200bn is being spent on infrastructure (you will discover the word “billion” is far more prevalent in the Emirates than “million” these days) and it can afford to do so because it is the world’s third largest oil exporter. This infrastructure programme is central to “Plan 2030”, the structure plan for Abu Dhabi which governs infrastructure, building heights, land use and different modes of transport for the next 22 years which, it would appear, will see even greater change than the past 22 years. The population is due to treble by then and – courtesy of a $20bn oil and gas development programme – the crude oil production capacity is due to go up 50% to 4m barrels per day in seven years' time. Until relatively recently the influx of expatriates to the Emirates tended to be people nearing retirement who were tempted to bring their expertise to the Middle East by being rewarded with a nice little nest egg. Now, there are people throughout their careers being tempted to move, not only for the money

but also for the experience of working on fantastic projects. And their families are moving with them. However, this does not mean that there are no problems. For a start, housing is struggling to keep up with demand – with the obvious inflationary tendency – house prices in Abu Dhabi jumped by 50% last year, making it more expensive than Dubai on average. Indeed, overall inflation is running at 11% per annum throughout the UAE and is showing no sign of abating. With this background of increasing demand and shortage of supply, the indications in the short and medium term are tremendous. My particular work in Abu Dhabi has centred around four of the dramatic projects that are being created by Aldar, a publicly owned company established three years ago and among the premier real estate and management investment companies in Abu Dhabi. They are Central Market in downtown Abu Dhabi, Al Raha Beach, Yas Island (a 2,550 hectare development opposite Al Raha Beach and adjacent to the airport) and finally, Noor Al Ain (one of the two major shopping centres/mixed use developments in Al Ain, the University City of the Emirates). With the exception of Central Market where the Norman Foster designs were just being completed, all the others — merely ideas 36 months ago — are well under construction. Central Market will create the most complete retail centre in Abu Dhabi. It includes a new souq (which used to occupy part of the site) and in addition has three towers including a 53-storey hotel, 58-storey office tower and 88-storey residential tower. In the city where 10-20 storeys are the norm, it will be the focus of the city centre and will open in phases from next year. Perhaps the most dramatic development in the whole of Abu Dhabi is Yas Island. At over 2,500 hectares, this natural island is half the size of Abu Dhabi Island itself (Abu Dhabi is made up of 200 natural islands). This whole flagship project when complete will cost $40bn and is going to become a major destination for tourism in the UAE. Opposite Yas and on the way into Abu Dhabi City Centre, is the 11km natural beach front that is Al Raha; 11 separate residential districts will be created, each with its own personality. At the end of the day 120,000 people will live there. It’s already a sought after place to live for top executives." n

ThE MIDDlE EAST OCTOBer 2008 55