x Abu Dhabi, UAEFriday 19 January 2018

Towering ambitions for the UAE

The next 12 months look set to give the country several new features that will build its reputation for creating stunning developments.

After Burj Khalifa's grand opening this year focus is now on major property developments.
After Burj Khalifa's grand opening this year focus is now on major property developments.

Next year will mark some major property milestones for the two largest cities in the UAE.

In Abu Dhabi, residents are due to start moving into homes on Reem Island and office staff are expected to start working at new premises on Sowwah Island. The moves are part of Plan Abu Dhabi 2030 in action and are likely to result in a major change in the look and feel of the capital.

In Dubai, meanwhile, thousands of new homes, offices and shops are expected to come on to the market even as prices decline.

That is likely to mean a fall in the cost of living, which some say will seed the emirate's economic recovery. Given Dubai's new infrastructure and appealing lifestyle, more companies from around the region will probably select the city as their headquarters.

As the year draws to a close, developers have taken a more realistic approach to property. Jones Lang LaSalle said in a recent report the challenges of the global property market had "forced developers to reassess their schemes, scale back more ambitious projects, seek alternative means of funding and plan products more aligned to the end-user".

In many ways, the UAE's property industry is in the midst of responding to the worldwide property slowdown.

Some 60 per cent of projects announced in Abu Dhabi in 2008 and perhaps even more in Dubai are expected to be cut back. Prices have declined by between 30 per cent and 70 per cent in some areas, analysts say, because of the global economic crisis.

The country will continue to face a challenging financing environment. Whether they are dealing with a buyer trying to find the 30 per cent down payment required to buy a home or a developer trying to finish the last leg of a building with debt, banks are still cautious about lending in the sector.

What is more, next year could be one of major legal issues in the country's property sector. In Dubai, the enactment of the strata law will play out prominently as owners get to grips with building maintenance and unpaid bills.

Meanwhile, the Abu Dhabi Government is widely expected to unveil a package of laws to govern the emirate's property sector, including a form of the strata law and an escrow law.

Whatever happens, the sector will remain one of the closest-watched in the UAE, featuring as it does architecturally ambitious towers, high drama and a tangle of disputes. Developments to watch next year include:

Sun and Sky Towers

Reem Island will next year become the latest centre of high-end living in the capital. Originally designed as a forest of towers, the island project was revamped after the property downturn.

The two most prominent developments are Sorouh Real Estate's Sun and Sky Towers and Reem Developers' Marina Square.

Sun and Sky Towers are among the tallest buildings in Abu Dhabi and command unique views of the city and the waterways through the mangroves.

The two buildings are connected by a five-story "podium" that is planned to contain restaurants, laundries and other amenities for residents. On top of the podium will be a pool and fitness facilities.

Marina Square is akin to Jumeirah Beach Residence in Dubai, with a cluster of 12 towers facing Abu Dhabi island. They will add more than 3,000 new homes. It is planned to have a waterfront promenade with shops and eventually a mall next door.

Some 200,000 people are expected to move to Reem when projects have been completed.

Sowwah Square

Abu Dhabi's answer to Canary Wharf in London, Sowwah Island is the new Central Business District of the city. The first four buildings, called Sowwah Square, will start welcoming their first tenants next year. Eventually the square will include a new headquarters for the Abu Dhabi Securities Exchange in a "floating" structure atop four columns.

Sowwah Square is expected to add 450,000 square metres of living space to the market.

The island has been quietly active during the property downturn, with several financial institutions buying plots on which to build headquarters, and hotel operators announcing plans to open there.

GCC nationals can fully own homes and offices on Sowwah Island, while foreigners from outside the six-country bloc will be able to acquire 99-year leases on property.

Sowwah Island will be a crucial link between Saadiyat, Reem and Abu Dhabi islands, with 13 bridges planned. It is expected one day to be home to 30,000 residents and 80,000 office workers.

Dubai Marina Project

Dubai is on track for another record when the Princess Tower is finished next year and stakes its claim as the world's tallest residential tower.

The 107-storey tower is planned to rise 414 metres, passing the 78-storey, 323-metre Q1 tower in Australia. The Princess will be just one of several eye-catching developments at Dubai Marina, which is now often referred to as "the tallest block in the world".

More than 200 towers are planned, including the 516-metre Pentominium, planned to surpass the Princess Tower as the world's tallest residential building when it is completed, which is likely to be in 2013.

Other towers under construction include the 380-metre Elite Residence tower and the 395-metre 23 Marina.

In addition, several other projects are progressing at the Marina, a master-planned development that is fast becoming the city's residential centre.

The list of developments scheduled for completion within the next year includes Cayan Real Estate Investment and Development's Silverene, which features one 35-storey glass tower and a companion 26-storey tower, and Damac Properties' 310-metre Ocean Heights.

Business Bay

Even by Dubai's standards, Business Bay is an audacious project. The 743,224 sq metre development is planned to include more than 200 towers and house more than 190,000 residents in a business district that has been likened to Tokyo's Ginza district or New York City's Financial District.

Construction slowed this year after the financial situation at Dubai Holding, the parent of the master developer Dubai Properties. But Dubai Properties has indicated that work is resuming on the infrastructure, as well as individual projects.

Dubai Properties Group has already announced plans to complete Bay Avenue, a two-storey, 16,258 sq metre retail centre. Various outside developers are also moving forward with their plans.

This year, the developer Deyaar handed over five towers and Damac Properties started preliminary work on seven projects.

Over the next 12 months, progress in Business Bay, a bellwether for the construction industry and the amount of available space in Dubai, will be closely monitored.

Projects scheduled for completion in the bay this year include the 31-storey Silver Tower and the 32-storey Regal Tower.