Work on some delayed real estate schemes on Abu Dhabi's partially stalled Reem Island community is starting again as developers begin to recover from the effects of the global financial downturn.
Reem Island starts to work through growing pains
Work on some delayed property schemes on Abu Dhabi's Reem Island is starting again as developers begin to recover from the effects of the global financial downturn.
Master developers Sorouh Real Estate, Tamouh and Reem Investments, which last year finally handed over the 1,150-apartment Sun & Sky Towers development and 3,400 flats in Marina Square, predict that by the end of next year the island will be home to thousands more.
In the Shams area of the island, Sorouh says its long-awaited 3,500-apartment Gate Towers will be completed next year.
"During the next quarter we expect to move closer to the completion of Gate Towers, which we will begin to hand over early in 2013," said Abubaker Seddiq Al Khouri, Sorouh's managing director.
The developer added that 12 plots in the area, including Chun Wo's Reem Diamond scheme, were under construction, two of which it expected would be completed by the end of the year.
Dhafir Development & Contracting's Amaya Towers in the Shams district is already complete.
Meanwhile Tamouh executives said they expected to complete eight of the 13 buildings comprising the developer's City of Lights scheme next year and the remainder of the towers in 2014.
Earlier this year, the Dubai-based Damac completed its 24-storey Marina Bay Tower, which forms part of Eshraq Properties' Dh75 billion (US$20.41bn) Marina Rise project.
And Reem Investments, the third of the master developers on the island, said work was progressing on its 50 million square feet Najmat project on the island after it signed a memorandum of understanding in January with a South Korean government body to build a cultural centre and homes for Koreans settling in the UAE.
But development on the island has been anything but smooth sailing.
"Obviously there are a lot of projects which haven't happened due to the global financial downturn, but we are now starting to see Reem Island begin to take shape," says Craig Plumb, the head of research at Jones Lang LaSalle's Middle East and North Africa operation.
"With all major developments, they all take a bit of time to start with as they begin to build up critical mass, and it is important to establish the infrastructure. After a first few developments become established, it becomes easier for others to follow."
"We were very disappointed about the type of commitment being made both by the major developers in Reem. The infrastructure and everything is not ready," said Derrick Pang, the deputy chairman of Chun Wo. "I think by the middle of next year when we showcase Reem Diamond, everything will be ready."
"We are very disappointed about that very speculative environment that created a lot of wealth and also destroyed a lot of wealth," he added. "In any healthy market I think government intervention is necessary, and in the future I do hope the Government does something because for people like us that come here for the longer term we cannot afford to go to places where we see what happened in 2008. It is very discouraging."