UAE: Abu Dhabi Construction Articles & Analysis

Chapter | Real Estate & Construction from The Report: Abu Dhabi 2017

Abu Dhabi’s office, residential and retail markets, long buoyed by undersupply, now face the opposite challenge, with a host of large-scale new completions coming on-line in recent years. This weighed heavily on sales prices and rental rates in 2016, although bright spots remain in the mid-market residential segment, as well as in prime up-and-coming neighbourhoods and commercial districts. In...

While reduced oil prices are undoubtedly a concern for the emirate’s authorities, economic diversification efforts of recent years mean Abu Dhabi is well placed to weather a prolonged period of subdued prices. Vision 2030 meanwhile contains a raft of goals that will further reduce the emirate’s reliance on hydrocarbons, and continue to foster the emergence of a more sustainable and knowledge-based economy in the years ahead.

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Renewed demand for more affordable housing in Abu Dhabi has come about as a downward readjustment of housing allowances has strained rents in the high-end residential sector. Developers are now shifting their strategies to include new mid-market developments. This has enabled double-digit returns on rental yields for some, making the mid-...

 

As Abu Dhabi accelerates efforts to diversify its economy away from a reliance on hydrocarbons, development of Al Maryah Island has become a top priority for real estate and construction. An international financial free zone and mixed-use real estate development, the island is expected to become a major financial and business district,...

 

How can developers weather the cyclical slowdowns in real estate markets?

 

Although it has risen to become a strong contributor to GDP and diversification over the past 15 years, Abu Dhabi’s real estate sector is feeling the pressures of an economic slowdown, brought on by a period of depressed oil prices and spending cuts that have affected markets across every property segment.

 

In 2017 Abu Dhabi’s construction sector should begin recovering after global oil prices reached their pain point in 2016, ending the year two-thirds higher than in January following a landmark OPEC deal. Stabilising oil prices allowed the government to reduce spending cuts, and the industry’s long-term outlook remains positive since the Abu...

While reduced oil prices are undoubtedly a concern for the emirate’s authorities, economic diversification efforts of recent years mean Abu Dhabi is well placed to weather a prolonged period of subdued prices. Vision 2030 meanwhile contains a raft of goals that will further reduce the emirate’s reliance on hydrocarbons, and continue to foster the emergence of a more sustainable and knowledge-based economy in the years ahead.