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52% of UAE's construction projects suspended

Post Time:Feb 06,2009Classify:Industry NewsView:336

The future of more than half of the UAE’s 1,289 construction projects hangs in the balance, a new report has revealed.

Nearly 53 percent of the UAE’s development portfolio, worth a combined $582bn, has been suspended as the construction industry grapples with the country’s dramatic real estate crash.

The findings by Dubai-based market research firm Proleads show that of a $1.3 trillion-strong industry, only $698bn is still in operation on active construction projects.

The report, which reviews the real estate, leisure and entertainment and infrastructure sectors, shows the real estate market to be the worst hit.

Some 180 projects have been suspended while projected cash flow, the marker of the industry’s health, is set to drop 43 percent in the first quarter of 2009, the report noted.

Real estate comprises around 74 percent of the UAE’s construction portfolio.

While the numbers are daunting, Emil Rademeyer, director at Proleads, said the report also offers glimmers of hope.

Based on past data explored in the report, the majority of the projects are likely to resume at some point, creating a “dormant opportunity” for contractors able to ride out the economic storm, he said.

“There are delayed opportunities in terms of the suspended contracts. The money involved - and it is billions and billions of dollars - is still there.

“Though the negative numbers are daunting, we should still focus on the glass being half full. There is still close to $700bn worth of projects on the table, and not many countries in the world can say that during times like these.”
 

Source: Arabianbusiness.comAuthor: shangyi

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