Is Dubai's construction sector recovering?

Will Dubai construction recover?

While everyone agrees that Dubai will be able to drag itself out of the financial hole it has found itself in, they are divided on how long it will take the emirate to get back on its feet.

This week, however, industry experts predicted that the sector would start to pick up by the end of the year with the main obstacle being the lack of liquidity in the emirate.

Speaking at a conference, Ali Bu Rahima, deputy director general of the Dubai Technology and Media Free Zone Authority said, "Dubai has the technical expertise as many international companies have based themselves in Dubai.

It's the economy that will be the industry's main challenge in the coming months in Dubai and I don't think this will get better until the end of 2010."

However, like many others Bu Rahima stated that instead of green-lighting new and expensive projects, the emirate should focus on those already underway and building up infrastructure around them.

No alternative

One thing that all developers can agree on is that Dubai can't simply be abandoned as a lost cause.

Sanzio Vaienti, global sales director at Soilmec, an Italian based company which manufactures drilling and piling machinery, is one of the many companies that has experienced losses in the last year.

"Dubai is a very important market to us. However recently due to the downturn it has not done so well and it probably won't pick up until the later end of this year We made a 70 percent loss in 2009 in the UAE. Globally we made a 50 percent loss."

Others that have made a loss such as the Tanmiyat Group, the Saudi-based master developer who is involved in projects in Dubailand, Business Bay and Dubai Marina, has said it is still committed to investment and growth in Dubai.

"We believe in Dubai. There is no alternative to Dubai in the region," Dr Rasim Kaan Aytogu, group executive director at Tanmiyat, told Arabian Business in an interview.

"It is just a correction in the market," he said of the current downturn in the market in the emirates.

"Dubai [has] very important potential for further investment," he said referencing the plans to turn the country into a major business and tourism hub.

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