UAE real estate chiefs cite diversification opportunities
Opportunities along Saudi Arabia's Red Sea coast will also be especially prevalent for developers looking ahead
The chiefs of two of the UAE’s top real estate development firms have cited the diversification efforts by some GCC states as a key opportunity over the next 12 months.
“With most GCC states looking to reduce their reliance on hydrocarbon receipts, focus is shifting towards diversified economies largely driven by trade, travel and tourism, real estate and infrastructure construction – in both transport and energy,” Abdulla bin Sulayem, chief executive officer of Seven Tides International, told Construction Week.
“This should present numerous opportunities for developers, especially along Saudi Arabia’s Red Sea coast, albeit over the longer term.”
Hussain Sajwani, founder and chairman of Dubai-based development heavyweight Damac, also said the economic diversification of GCC member states “poses the most lucrative opportunity for the real estate sector in the coming months”.
The 10-year residency visa, aimed at attracting and retaining top talent in the UAE, “will also be a big boost to the country’s real estate sector”, he added in his comments to Construction Week.
With this positivity in mind however, both touched on challenges that GCC developers will face over the next year.
“I would say competition is the biggest challenge facing developers over the next 12 months; however, it is important to note that competition is also very healthy,” said bin Sulayem.
“It continuously forces developers to come up with creative and innovative ideas, and this is what makes them stand out from their competitors.”
The “lack of an evolved public-private partnership model to help absorb the cost of development” is also a major challenge, as Damac’s Sajwani pointed out.
There are signs that parts of the UAE are showing signs of deepening collaboration between the public and private sector, namely the UAE’s northern emirate of Sharjah whose property market has gained momentum thanking to this funding model.