Abu Dhabi a bigger construction site than Dubai within four years

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The volume of construction activity in Abu Dhabi will outpace neighbouring Dubai within four years, delegates at the MEED conference in the UAE capital heard this week. This building boom will allow the population of the city to double within a decade and the focus is very much on private sector involvement. Not since the 1960s when Abu Dhabi first arose from the Arabian sands has the city seen anything like this transformation, and the commitment of the government is clear and absolute. Several speakers at the MEED conference referred delegates to the integrated urban plan available in full on abudhabi.com which is a remarkably concise document detailing the expansion of the city. One of its objectives is to avoid the infrastructure bottlenecks that have left neighbouring Dubai with a traffic gridlock over the past few years. But Abu Dhabi already benefits from a road system with a generous capacity for existing traffic which will help. 'The first consultants offered our dear Sheikh Zayed a network to handle 50,000 residents and when questioned they returned with a system for 100,000. And he told them to build for half-a-million,' said engineer Jaber Ali Khali, CEO of Zonescorp, the giant quasi private developer of free zones. Cash is king That Abu Dhabi has the money today to undertake such a visionary expansion is not in doubt. McKinsey Managing Director Kito de Boer estimates that the city will have accumulated an oil surplus of $800bn from 2005 to 2020. He told the conference: 'Abu Dhabi will have the highest concentration of wealth on the planet.' Actually there is no need to project into the future. Abu Dhabi is already this rich with a rumored $850bn in its sovereign wealth funds and 10 per cent of the world's oil reserves. However, the astonishment that accompanied the new mega project announcements of the past couple of years has now given way to a more practical focus on getting the job done. On the conference margins there were still a few grumbles about slow decision making and a lack of urgency in comparison to Dubai. Private sector boom On the other hand, the mobilisation of a newly revitalised private sector in Abu Dhabi was also very much in evidence. The Chief Operations Officer of the Al Jaber Group, Fatima Al Jaber already has 30,000 workers under her control, and said she was gearing up for the estimated workforce of 700,000 that will be needed to construct the new Abu Dhabi. Finding human resources is the biggest challenge for the emirate, said Ron Barrott, CEO of Aldar Properties. But he believed that solutions were being found and that within four years construction activity in Abu Dhabi would outpace Dubai. For real estate investors the upcoming $2.4 trillion worth of active and announced projects in Abu Dhabi presents a conundrum of opportunities. Where, when and how to invest? This is likely to be a constant theme for many years ahead.

 

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