Tuesday, October 28, 2008

Dubai real estate: mixed messages

WSJ Blog:
A six-year real estate boom in Dubai that spurred a $475 billion building frenzy has ended, according to agents who say sales are collapsing amid fears that the global economic downturn will hit the sheikdom.
...
“Our commissions have fallen by up to 70% recently,” said Khaled Daji, an agent at Al Jabal Real Estate. “The most hit are the projects under development and those luxurious high end. We plan to survive for another six months to see how this crisis unfolds.”

But the city’s biggest developers like Emaar Properties PJSC and Nakheel are adamant that sales remain robust. Mohammed Alabbar, Emaar’s chairman and one of the architects of Dubai’s real estate boom, said in the company’s third-quarter statement that “we are very confident of our company’s fundamentals and future growth.”

That hasn’t stopped investors dropping the company’s shares.

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4 Comments:

Blogger nzm said...

I came here to see if you had also read this, and you had!

I also found this today.

I guess it comes down to who you would believe - the real estate agents crying poor or the developers trying to flog off their properties!

12:01 AM  
Blogger Bilal said...

The problem about Dubai, in my opinion, is that it relies solely on real estate, it doesn’t have a solid manufacturing or production industry that can make it secure to sustain such an aggressive downturn from the international market. The other main businesses in Dubai are logistics (i.e. Jebel Ali Free Zone) and the financial market, and these exact businesses are strongly related to the international market. So take these 2 businesses out, you will only have real estate which highly depends on liquidity.

Bilal

2:25 PM  
Anonymous Anonymous said...

Any truth to the rumour that the Chairman of Emaar is under house arrest and that there is a party gone to Abu Dhabi seeking a loan of $50 billion??

5:05 PM  
Blogger Astral-Plane said...

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3:14 PM  

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