DUBAI// Emiratis have welcomed the announcement of a Dh3 billion government loan fund to finance new commercial building projects.
The new fund will make 245 loans available to UAE nationals who already own land earmarked for investment properties and businesses but who require extra finance to cover the cost of construction.
Of these, 133 have been allocated to pay for the demolition and rebuilding of residential apartment towers and villas for rent, 103 are for new buildings and the remaining nine for annexes to existing buildings.
The cash will be made available through the Abu Dhabi Department of Finance’s commercial buildings finance committee.
UAE nationals say the new loan fund will encourage Emiratis to develop their own businesses.
“This is a good step by the Government because it will encourage locals to stop thinking of themselves as consumers and give them the confidence to take the initiative in business,” said Mohammed Saleh Ali, an Emirati engineer in Abu Dhabi.
Mr Ali was given land by the Government seven years ago and in September secured a Dh2 million loan to allow him to build on it.
“For me it is slightly different as I am more focused on building a family home.
“Although this doesn’t directly apply to me, for people who have already secured their family homes it is good because they can be thinking about developing a business.”
Mr Ali said the big issue for many young Emiratis was to have their own home and the Government had done extensive work to support that.
“I live with my father and the first priority for me is to look after my family.
“Only once that was done would I think about investing in commercial property as a business.”
Hamad Al Hurr Al Suwaidi, chairman of the Abu Dhabi Finance Department, said the loans would have a knock-on effect on other sectors of the economy.
The finance, he said, would push urban development forward towards the government’s vision and strategy for Abu Dhabi, and provide proper finance to stimulate the proerty sector into positive trends and help it to flourish.
The Government sees these loans as a way of boosting investment in property and providing a new supply of high quality properties, he said.
The move will help citizens to have stable incomes from revenue collected on these properties, said the government news agency Wam.
The commercial buildings finance law was introduced by the government of Abu Dhabi in 2005 as a way to help Emirati landowners to obtain funds for property projects.