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Confidence remains in Abu Dhabi property market

Officials say that property values will remain high despite the current global slowdown and a research report from Citigroup says that Abu Dhabi has the cash to pay for all of its current development projects and is expected to see yet more growth.

'Even with steep rent increases, the average prime rates are competitive on a global playing field. Abu Dhabi rent levels lag significantly behind London and Hong Kong, and are still some 40% behind Singapore, Tokyo and Moscow,' the report said.

The state's Plan Abu Dhabi 2030, an urban development framework showing how the Emirate plans to cope with an expected population rise of 300% is regarded as a solid framework for the years ahead.

Many developers are upbeat but cautious. However some are cutting back. Abu Dhabi's biggest real estate developer Aldar Properties said it has no plans to slow down or put on hold any projects.

'Everybody is affected by the financial tsunami, nobody is immune. However, all projects that we started are going on as planned and we are not laying off anyone,' said Ousama Ghannoum, Aldar's marketing director.

He said Aldar's ongoing projects in Abu Dhabi, which include the Formula 1 track, Central Market project, hotel projects and Al Raha Beach residences, are going to be completed on schedule.

'We have tight delivery schedules and we are going at full speed,' Ghannoum said, adding the Formula 1 track would be ready next year to host the last Formula 1 race of the 2009 calendar year in Abu Dhabi on November 1. However the company's shares have been falling.

Meanwhile the Al-Mazrui Holding Company, a private company, has told potential bidders for the main construction contract on the Lagoon Club development in Abu Dhabi that all building work is being suspended until the financial situation improves.

Chairman Abdullah Mohammed Al Mazrui described it as a precautionary measure to minimise the negative impact of the crisis and said that once things improve the plans will be moved forward.