Masdar City's moment in the sun

Masdar reaches a defining milestone this year as the eco-friendly, futuristic city more than doubles in size and welcomes commercial tenants including Siemens and GE.

Masdar City also houses Masdar Institute, above, a graduate level university and research organisation occupying eight faculty buildings. Fatima Al Marzooqi / The National
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Out in the desert next to Abu Dhabi's airport, the emirate's vision of the future is slowly becoming a reality.

For Abu Dhabi's Masdar City, an ambitious eco-vision that the owner Mubadala Development hopes will help to diversify the economy away from fossil fuel exports, this year is shaping up to be an important year.

"We are not just a science project," says Stephen Severance, the city's head of programme management and logistics. "Masdar is open for business."

Mubadala is a strategic investment company owned by the Abu Dhabi Government, and its grand experiment in future technology, which includes plans for housing 50,000 people and employing 40,000 in a carbon neutral, commercially viable city, has been up and running for two years.

It also features the Masdar Institute, a graduate level university and research organisation occupying eight faculty buildings, as well as operating a state-of-the-art wind tunnel and a whizzy electric car public transport system.

But this is likely to be a watershed year for Masdar as the city more than doubles in size and - perhaps more importantly - welcomes its first commercial office tenants.

In that time, Masdar will go from being a 35,000 square metre research base that houses about 300 of its postgraduate students on campus to being a 110,000 sq metre mixed-use eco development, including businesses and shops.

Mr Severance guides yet another party of day trippers around the futuristic university buildings and waves in the direction of the city's first new office block - Siemens' 22,000 sq metre headquarters - which is set to open this year alongside an extension to the institute, about a third of which will be leased out to other firms.

This will soon be followed by an 8,000 sq metre start-up incubator. The 2,000 sq metre Masdar and International Renewable Energy Agency, known as Irena, headquarters building is then set to be completed early next year.

"Siemens is moving in, and we'd like to see other companies moving in too," says Mr Severance. "Rents are absolutely competitive because people are not going to move here just because they are going to use less in electricity or water. Companies have to move here for commercial reasons."

Masdar, which was conceived in the height of the 2006 and 2007 property boom, has had to learn some harsh commercial realities fast to fill its offices. Now the company is going all-out to court commercial occupiers. "We offer everything from workstation space for very small businesses in fully fitted-out offices to core and shell in larger installations, and the prices vary depending on the level of fit-out that we do versus what you do and the size," adds Mr Severance, who is in charge of setting sustainability goals and balancing different requirements of economics and sustainability.

"We are competitive with Abu Dhabi [city]. You find us competitive with other Abu Dhabi buildings. We have to be."

As well as the German electronics and engineering giant Siemens, Masdar has also signed up General Electric from the United States, as well as Mitsubishi from Japan and SK Group from South Korea. And it expects over the next few months to bring more of the 100 or so companies already registered with the Masdar free zone into the new city.

"Right now, depending on a couple of deals, we probably have between 3,000 and 6,000 sq metres left to rent of our current office stock," says Mr Severance.

"We have almost 100 companies registered in the Masdar City free zone, and they will be moving into the city," says Naser Al Marzouqi, the head of facilities management at Masdar City.

"They are already operational through a Masdar City licence for the past three years. We have managed to lease some office space outside in the city so they could become operational. Then later on we can move them to Masdar City."

"At the end of the day it is the cost of building which influences the rent so we are competitive," he adds.

"Moving to Masdar City will give you some green points for your own company for social responsibility, etc. However, to drive sustainability or green concepts you need people who work in all sorts of disciples - like law firms or accountants or anybody. So it's all complementing each other."

But all of this is still just the tip of the iceberg for Masdar, which is expected to extend to a whopping 3.7 million sq metres in its first phase alone. Of that, Masdar hopes to have about 1 million sq metres built out completely by 2017.

In 2010, the company unveiled a new strategy for the city, in some cases turning Masdar itself from developer to master developer and leaving some of the risk and construction to third parties.

It now hopes to complete a series of land deals with independent developers for much of the residential component of the city.

And Masdar officials say they have no plans to finalise plans for future development phases.

"We are not a real estate company," says Mr Al Marzouqi. "There is no point for me to build a full city within five years. Technology is changing. Technology is becoming more commercial. So I have to get my lesson learnt. If I build it all then what is next?

"We have the students who are studying and living here who are coming with ideas so we can implement them and become more sustainable, and then you can push the envelope a little more."