13 May 2015 - The property industry in the United Arab Emirates (UAE) continues to grow, with an increasing number of diverse developments being announced, constructed and handed over.
In any region, you need to understand local conditions but with the market focus shifting away from multiple megaprojects, it’s even more essential that companies such as Aurecon possess an in-depth knowledge of local conditions, trends and client requirements.
Simon Hough, Aurecon’s Unit Manager Buildings – Middle East, discusses these in this article.
Buildings projects in the UAE have individual challenges, centred around client requirements and a unique and changeable authority approval process.
“We are often approached by a client in a hurry, who wants to appoint the consultant ‘yesterday’. In reality, tendering the consultant often extends, with the expectation that the consultant will be ready to mobilise instantly upon client request. Procurement of the contractor can follow a similar process, pushing out the start-on-site date,” says Hough.
• Cost consciousness
Clients in the UAE are cost conscious and it’s essential that consultants justify the value they are adding to a project. Data modelling can be used in order to show clients how certain technologies can be applied in ways that will give them a return on their investment. Aurecon remains at the forefront of cutting-edge technology, which can help clients make smarter investment choices.
“Building information modelling (BIM) adds confidence to complex designs. Depending on what level of detail is required, BIM improves coordination, adds cost certainty and reduces queries on site,” explains Hough.
• Local authority approvals, reputation and relationships
Reputation is key to doing business in the Middle East’s building industry. Being seen as a trusted service provider and earning a reputation for being able to deliver outstanding quality work is very valuable.
Local authority approvals can be challenging. Building relationships with local authorities is a critical element for driving a project forward.
• A shift from residential to commercial projects
If you visit Dubai’s local property rental website, Dubizzle.com, you will see that there are over 50 000 apartments available for rent. There is a surplus of residential space in Dubai and this surplus is due to increase with more developments being launched now and in the coming years, pushing sales and rental prices down.
“Prior to the global financial crisis, it was extremely expensive to buy or rent residential properties in Dubai based on high demand, leading developers to build more residential properties. Since the crash, residential developments have been completed while additional projects have been designed and are in the process of completion. However, the focus of the municipal planner has shifted to travel and tourism, with more plots now being allocated to business hotels and attractions, such as theme parks.
• Business stopover tourism
According to the Tourism and Hotel Market Outlook by Deloitte, Dubai attracted 7.8 million hotel guests and 2.1 million serviced apartment guests in 2012, representing a total of 9.9 million guests over a 12 month period. In addition, the Global Destination Cities Index 2013 ranked Dubai as the world’s seventh most visited destination for international overnight visitors, ahead of Hong Kong, Barcelona, Milan and Rome.
Dubai plans to capitalise on this overnight visitors market by developing more 3 and 4-star business hotels. Dubai focused heavily on resorts and luxury hotels in the past but now there is a push for business and travel hotels, supplementing Dubai’s ideal location as a travel hub.
• Theme parks
Dubai wants to become the destination of choice for tourists and a number of theme parks and other tourist attractions are currently being developed. Aurecon is working on the Motion Gate project in Dubai, which is a movie-based theme park featuring DreamWorks Animation franchises. Everything from state-of-the-art rides to themed retail, dining and entertainment are being planned and some of the media outlets have called it the ‘Universal Studios of Dubai’.
The UAE has one of the highest per capita consumption rates of water and energy in the world. According to the Federal Water and Electricity Authority, the average UAE resident consumes 550 litres of water and 20-30 kWh of electricity per day, compared to the international average of 170 litres of water and 15 kWh per day.
The sustainability index in Abu Dhabi is Estidama, which employs a Pearl Building Rating System (PBRS) to promote sustainable building initiatives. A single Pearl rating is the standard and if you are designing for the government in Abu Dhabi, you need to achieve a 2 Pearl rating. There is increased focus in the region on reducing water and electricity consumption.
• From flamboyant to practical
A decade ago, the UAE was be seen as an architect’s dream. Anything an architect could envision was built. While architects and developers had extensive opportunity to push the boundaries, the designs are not as over-the-top and extraordinary today. The buildings and developments are still state-of-the-art, high tech and many of them are megastructures, but they are more practical than a decade ago. Many of the new projects are comparable with developments and buildings that are under construction in the rest of the world.
“Numerous opposing needs have to be carefully balanced in order to complete world-class projects in the UAE. Not only do the trends change at a rapid pace but you also need to future-proof projects and predict what the tourism needs, local needs and client needs will be. Aurecon is excited to have a wide footprint in the region, and to be involved in some of the most noteworthy building projects in many of the capital cities,” says Hough.