The Dubai-UK joint venture lands two contracts in Abu Dhabi.
Al-Futtaim Carillion on a roll with Yas Island IKEA order
Al-Futtaim Carillion has boosted its Abu Dhabi order book after landing two more contracts in the emirate worth about Dh614 million (US$167.1m). The company, a joint venture between Dubai's Al-Futtaim Group and the UK's Carillion, will build a new IKEA store on Yas Island in a deal worth Dh168m, and a university in Al Ain for Dh446m.
Construction on the IKEA store, which is being developed by Aldar Properties and will be one of largest IKEAs in the world, will be completed by the end of this year, Carillion said in a statement to the London Stock Exchange. IKEA, renowned for its cheap range of flat-pack furniture, including the Billy bookshelf, has 301 stores in 37 countries. The Swedish company already has an outlet in Dubai and another in Marina Mall in Abu Dhabi.
The joint venture will build stage three of a university project in Al Ain on behalf of Mubadala Development, a strategic investment company owned by the Abu Dhabi Government. The contract includes the construction of academic buildings, recreational facilities and accommodation. Al-Futtaim Carillion, which is best known for the sprawling Festival City project in Dubai, moved some of its staff to the capital early last year as construction opportunities in Dubai slowed.
The company is also building the New York University project in the capital in a deal worth Dh3.1 billion. "The new UAE university is one of Abu Dhabi's most prestigious developments and we look forward to working in partnership with Mubadala," said John McDonough, the chief executive of Carillion. "The new IKEA development, which will be one of the largest IKEA stores in the world, is also another significant win that further reinforces the strong market position we have established in Abu Dhabi."
Al-Futtaim Carillion, which also worked on MotorCity, a development in Dubailand by Union Properties, is among dozens of contractors who have ventured into Abu Dhabi to counteract the slowdown in Dubai. But winning work in the capital has been tough, with contractors forced to cut their prices to stay afloat as competition intensifies. The Tourism Development and Investment Company has re-issued tenders on a number of projects announced in 2008 or earlier, including the Louvre Abu Dhabi and the Guggenheim Abu Dhabi, to benefit from construction costs that have fallen by about 30 per cent since the end of 2008.
Work on other projects has been scaled back, including Masdar City, the carbon-neutral development conceived in 2006. firstname.lastname@example.org