News

As more and more investors look to the emerging Abu Dhabi property market, we are now seeing an increase in activity from both local and international developers and investors buying buildings. Individual unit buyers are also eagerly awaiting imminent releases of properties for sale as the contract structure of purchase becomes clearer.

Recent announcements are also serving to further boost confidence in the answer to the ‘Why invest in Abu Dhabi?’ question:

• Abu Dhabi has announced that within the next seven years it will set up 30 industrial clusters across more than 300 square kilometres of land to include metal, chemical and petrochemicals, food processing industries, construction and building materials, wood and furniture, oil and gas services and automobiles. The Higher Corporation for Specialised Economic Zones (HCSEZ) which has now been renamed ZonesCorp, has indicated that new legislation to be issued very soon will allow 100 per cent foreign ownership of companies who will also be allowed to market their products duty-free locally and in the member countries of the Gulf Cooperation Council. It is also working on a ‘One Stop Shop’ to fast-track the process of company registrations and necessary permissions and licenses.

Two industrial cities are already set up with some 82 of 160 major international manufacturing companies working in ICAD I and 40 major companies setting up their operations in ICAD II, which is 96% booked, committing over AED10 billion to date in investment.

• National Cement Company, located in ICAD, plans to invest AED400 million to boost output to five million tones of cement by 2008 to cater to the considerable demand that Abu Dhabi will have over the coming decade.

• Khalifa Port and Industrial Zone, with an investment of AED8 billion, is to be set up and this will also house the largest single site aluminium smelter in the world with a 1.2 million tonne capacity. With an investment of AED22 billion it is expected to create 4,000 jobs.

• Abu Dhabi is forecast to award more than AED47 billion for construction projects by 2007. It is anticipated over the next five years that the volume of investment in all sectors will reach more than AED500 billion with real estate, construction and building sector attracting more than AED220 billion, followed by energy with about AED80 billion, environment sector with almost AED66 billion, while the services sector (education and health) will get AED45 billion. The predicted volume of investment in the field of tourism is about AED40 billion, followed by AED38 billion for industry and more than AED749 million for the agriculture sector.

• ‘Cert Education and Research City’, an AED1 billion venture, will be created in Abu Dhabi by 2007/8 to become a globally recognized entity for education and a technology cluster development.

• On direct foreign investment, it is expected that the Abu Dhabi economy will attract more than USD4 billion this year and that the figure would be doubled over the next few years in view of the establishment of new industrial cities and estates, along with real estate investment and property holding laws.

• The Abu Dhabi economy is expected to grow by 6.1 per cent this year and this month also saw Abu Dhabi announcing that it had the highest per capita GDP in the world last year at AED169,500. The private sector’s role has expanded in development with its contribution to GDP increasing by 17.6 per cent and this growing role, together with the implementation of economic and structural policies and programmes, has improved economic performance and boosted the achievement of potentially high, sustainable growth rates, expected to hit 9.8 per cent in 2006.

• Abu Dhabi Tourism Authority opened its first overseas office on 2nd February, located at No. 1 Knightsbridge, London, reinforcing its commitment to strengthening Abu Dhabi in the European travel and tourism market. The office will coordinate with British tour operators and tourism companies and prepare for participation in travel trade shows and conferences in Europe. Abu Dhabi will also be heavily promoted as a conference industry destination.

• Etihad Airways has unveiled its first purpose-built aircraft; the Boeing 777-300ER (extended range) which is the first of 24 new aircraft that will join the UAE National Airline’s fleet in the coming months. Etihad made history by placing an order worth USD8 billion for new aircraft within the first two years of operation. As well as purchasing the five Boeing 777-300ER aircraft, Etihad has also ordered 24 Airbus aircraft – four A340-500s, four A340-600s, 12 A330-200s and, probably most exciting of all, four double-decker A380s.

In summary, we are seeing a progressive commitment by the government and its specially created entities to a sustainable growth in tourism, industry and population in Abu Dhabi, backed up with legislation and investment.