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UAE contractors and developers eye Abu Dhabi tourism construction

by Oscar Rousseau on Apr 26, 2018

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Abu Dhabi Cityscape, held on 17-19 April, welcomed thousands of attendees and witnessed the unveiling of new projects worth more than $4bn (AED15bn).

Notably, not only did developers announce flagship projects at the exhibition, but most development leaders also expressed optimism about Abu Dhabi’s tourism sector – one that is rapidly growing amid economic change in the emirate.

Government officials have had an eye on developing Abu Dhabi’s post-oil economic model for more than a decade. In 2006, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, HH Sheikh Mohamed bin Zayed Al Nahyan, called for the development of a long-term economic strategy for the emirate, and accordingly, the Abu Dhabi Economic Vision 2030 was born.

This blueprint outlined 12 sectors the emirate should focus on to deliver economic growth and diversification, and tourism was one of them.

To date, Abu Dhabi has invested heavily in the tourism sector, building a number of acclaimed attractions such as the Louvre Abu Dhabi, Sheikh Zayed Grand Mosque, and the Saadiyat Island Cultural District, with its cluster of museums, cultural, and educational institutions. Recent tourism-focused construction projects include the Warner Bros World Abu Dhabi theme park, estimated to be worth $1bn (AED3.67bn), which will open at Yas Island on 25 July. Then there is the five-star Saadiyat Rotana Resort & Villas, which will open Q3 2018.

Aside from hotels and high-octane theme parks, the Founder’s Memorial, a cultural landmark commemorating the late HH Sheikh Zayed bin Sultan Al Nahyan, also opened in April. The 3.3ha landscaped space on Abu Dhabi Corniche features a centrepiece sculpture designed by US artist Ralph Helmick, called The Constellation. The general manager of the Founder’s Memorial, Yousef Al Obaidli, has called the site a “new landmark” and “major visitor attraction”, saying it will help to strengthen the UAE’s attractiveness as a cultural tourism hotspot.

It is unsurprising, therefore, that property development leaders are excited about Abu Dhabi’s evolution. Imkan’s chief executive officer, Walid El-Hindi, says he hopes more tourists will flock to the city. “The growth of Abu Dhabi is the main factor for Imkan,” El-Hindi tells Construction Week. “We based a lot of our research on [trying to understand] what Abu Dhabi is about. When we researched Abu Dhabi, we found amazing potential for a city that is coming to fruition in the next five to 10 years. I think Abu Dhabi will become one of the top cities in the world. It is already establishing itself as a cultural hub, and with that at the base of the city, there’s no limit to how great it can become. We’re banking on this.”

The Abu Dhabi-based developer, a wholly owned subsidiary of Abu Dhabi Capital Group, may be new to the market, but already boasts 26 projects, including Makers District, Nudra, and Sheikha Fatima Park, each at various stages of development. At least four additional construction contracts will be awarded this year, El-Hindi says, as Imkan looks to roll out new projects in line with Abu Dhabi’s tourism growth ambitions.

Executive director of Aldar Properties, Mann Farid Al-Awlaqi, also expects tourism to boost Aldar’s bottom line. Following the launch of Aldar’s $2.7bn (AED10bn) affordable mixed-use community Alghadeer, Al-Awlaqi tells Construction Week that a rising number of visitors to the UAE’s capital will benefit the company’s prospects: “Tourism growth in Abu Dhabi will benefit Aldar twofold. Firstly, it will deliver an increase in diversified GDP (gross domestic product), which will boost the economy, stimulating demand for property and thus, [driving] population growth.”

Secondly, he explains, will be the advantages that increasing tourist numbers will deliver to Aldar in its capacities as both a development manager, and as an investor.

As an investor, Al-Awlaqi explains, Aldar acquires property that it has either built, or held on to, in line with a pre-determined investment or acquisition strategy. The company’s hospitality activities fall within this umbrella, he says, adding: “We have multiple hotels in Yas Island that are right next to Abu Dhabi International airport.

“These tourists come to the city, and Yas Island is right next to them, which is why you see Aldar’s hotel occupancy rates are much higher than the sector-average across Abu Dhabi.”