Dubai real estate market not likely to recover until 2011, chief executive claims
The head of Dubai’s second largest developer, Deyaar, believes that the real estate market in the emirate will post a recovery in 2011, the third year after its initial crash.
‘My personal belief is that Dubai has reached the bottom. I cannot tell you whether the market will oscillate 5% up or down this year, but I can tell you that it won’t go 20% up or down,’ said Deyaar chief executive Markus Giebel.
‘In my personal opinion Dubai will see a recovery in year three, by which I mean 2011. Dubai’s fundamentals are still strong. If you believe in Dubai, you should believe in Dubai’s real estate sector. Because if Dubai is healthy, then the real estate sector will be as well,’ Giebel added.
He explained that 2010 would be ‘the year of the contractor’ and insisted that the firm had less than AED100 million ($27 million) in accounts payable to contractors. Giebel revealed that the firm had instigated a full review of all its contractors and is in the process of issuing its ten of its biggest partners with transparent payment plans that would be completed and signed within the next two or three weeks.
‘Your contractors don’t want the money right now. If you talk to these people, they are just asking for clarity or a payment plan. It’s most important to talk to these people and then commit to, and execute, a payment plan,’ he added.
Meanwhile Bahrain is to create an association aimed representing the kingdom’s real estate sector. The Bahrain Property Development Association (Bapda), will foster infrastructure services, co-operation, fair trade practices and integrity among its members, and will be a platform for the members to liaise with government authorities in forming best practice policies relating to the industry.
‘The Bahrain Property Development Association will be the first of its kind in the kingdom and will initially work towards forming amicable business ties among the members along with a specific focus on various pertinent issues like eco-friendly construction, green building construction concepts, productivity and quality optimisation,’ said Diyar Al Muharraq chief executive officer of Aaref Hejres.
The association will also be actively involved in establishing a research centre that will serve as a common database for compiling, managing and efficiently exchanging relevant research data along with other such industry statistics. The members also aim to promote activities like educational development and professional development.