Construction and real estate experts agreed that Dubai remains in a good position to move forward through the global financial crisis.
The panelists listed a number of fundamentals which they said were already in place that would pull the emirate through the worst of the ensuing credit crunch.
The words spell good news for the construction industry, but much still rests on the flow of liquidity resuming to the market, before projects placed on hold can be restarted.
“Dubai has some strong fundamentals,” Jones Lang Lasalle regional director for Mena Ian Ohan said. “It is already established, and is a legitimate player going forwards.”
Moody’s senior credit officer Khalid Howlader pointed to government construction initiatives, such as the Dubai Metro and Emaar’s Burj Dubai, as vital to the future of the emirate. “No one is going to take developments such as those away,” he said.
Howlader added that the “dynamism” of the government would “allow for a quicker turnaround” once banks were able to resume lending again.
The pressure on poorly equipped firms, some of which may be forced into bankruptcy as a result of the financial crisis, would also be good for the construction industry in the long run, Omniyat Properties group development director Stephen Ashford said.
Speaking at the Cityscape Connect Business Breakfast meeting in Dubai on Wednesday, Ashford said: “Already it’s a good thing. It’s forcing companies to reassess business methods and professionalise in a way that can only be good for Dubai.”
But, Ashworth warned further challenges remained ahead. “We have seen a large repatriation from emerging markets,” he said. “This will fundamentally change the Dubai real estate outlook for the short-term.”
Almas Capital managing director Barmak Besharaty also warned against looking to the refinancing of debt as a means of recovery.
“If we continue to say that debt is the solution, we need to remember that debt became the problem,” he said.
by Jamie Stewart Mar 13, 2009, www.constructionweekonline.com