Dubai keeps up property growth

source Hurriyet

DUBAI - A top Dubai property development executive said Sunday that the emirate's booming real estate sector would maintain growth despite the global crisis as demand continued to outstrip supply.

"Domestic demand for real estate continues to outstrip supply, and it will be so for several years," Mohammed Alabbar, chairman of real estate giant Emaar, told participants at a World Economic Forum meeting in Dubai.

"This demand is real, and there is a positive shift now towards an end-user market," he said, in an apparent reference to a reported exit by speculators from the sector which saw a significant overheating in past years.

Alabbar, who is also a member of the Dubai Executive Council, shrugged off claims that Dubai's thriving economy was poised to slow down due to a drop in real estate, stressing that the city-state's economy has other driving sectors. "For several analysts, the 'Dubai Inc.' story is tied in to its real estate sector.

They miss the mountain for the hill," he said. "The Dubai economy is driven by traditional sectors such as re-exports and trading; tourism and retail; transportation and logistics; manufacturing; the free zones and the business hubs for IT, media, financial services, education and healthcare. These are the sectors that drive real demand," he argued.

He claimed that the impressive growth in real estate was "Dubai's answer to the demand created by these traditional sectors".

Alabbar downplayed the impact of the global credit crunch on Dubai's real estate sector, saying the bulk of the market was equity or cash-driven, with very little mortgage-dependent developments."This takes out a lot of risk from the system," he said.