Wikinvest Wire

Booming Dubai

Wednesday, October 11, 2006

A set of photos came in the mail the other day, their original source unknown. They were so impressive, sharing them with a wider audience was warranted.

For some years now, word has come of boom times in Dubai - the scale of the boom something that few Westerners have seen first hand. Though increasingly a vacation destination, not many Americans are likely to have passed through this city in recent years.

Maybe some U.S. businessmen have seen what's been going on there, but for the rest of the country it's been an occasional news story or business show comment that comprises everything that is known about this city and the country of United Arab Emirates (UAE).

The IMF recently predicted that economic growth in the UAE would be cut in half next year, in large part due to capacity constraints in the construction sector. It's not hard to understand why when you see all that the construction going on.

Steel and concrete prices have been rising rapidly - they just can't supply enough building materials to keep up with ongoing construction that has only accelerated in the last few years. The photo below right, taken in 2003, doesn't accurately depict the current skyline, but it does demonstrate how much has changed since 1990.


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This is a more recent photo, they don't seem to have a problem getting building cranes...



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... or beach umbrellas.



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If half of the world's tower cranes are in China and another 15 percent here, that doesn't leave too many for the rest of the world.



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They'll probably need fewer cranes for building condos in the U.S. over the next year - that should help.



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These island developments are impressive - The Palm, The World, and many more. Note The World archipelago to the right in the photo below.



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Here's a close-up - you can own your own island for only $7 million.



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It doesn't look like there is much inland, once you get about a mile away from the water. This photo appears to be mislabeled - according to this, the Marina Project is inland.



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They say there are 40,000 to 60,000 new homes set to go on the market in the next year.



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An episode of the Amazing Race had the teams going to Dubai and making their way to the top of the Burj Al Arab hotel, shown at the bottom of the picture below. The episode was filmed back in May - it must have been quite an event for the locals.



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This is the Jumeirah Palms project with the Marina Project in the foreground.



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There is much more to see, starting at Wikipedia:
It makes you wonder what the place will look like in ten or twenty years, or fifty.

15 comments:

Anonymous said...

Another HK in the making? That took < 50yrs to go from backwater to financial power. Wonder what the tax structure is like. I bet it is damn low and this is the result of capital fleeing big government grabs.

Anonymous said...

The question of what Dubai will look like 50 years from now is a good one. It's risen as a center of commerce surrounding the oil industry, but when that eventually declines, there will be little need for that. It will then probably look like it did 50 years ago, just a bunch of sand.

Aaron Krowne said...

Hong Kong evolved; if Dubai does similar, it has no natural lifespan. Oil could just be a springboard; wisely invested, it could take the UAE far.

(What I'm saying is I hope the UAE is putting their reserves in something besides dollars ;)

Chip said...

I've been to Dubai several times, most recently three years ago. It is a very interesting story of princes and oil wealth. Dubai has the most magnificent high-rise buildings in the world -- each one is more amazing than the last. Usually, each is owned by a prince who is competing with the other princes (tons of princes in the Gulf OPEC countries). These days, from the looks of those photos, some princes likely are collecting multiple buildings. What isn't shown is the occupancy rates, which used to run about 20%, as I remember. No problem, if you are a prince in an otherwise very well-run Gulf state and if you don't mind subsidizing your jewel.

I cannot imagine anywhere enough people to occupy most of that space. While Dubai is an Arab watering hole, in the same manner as Bahrain but not as loosely so as Cairo, it is in the Persian Gulf. I have been there through an entire summer. It passes 130F regularly, though the papers report 129 because of the labor laws. Once when I was there in Dhahran, it went over 140. That is so hot that if you are outside, all you can think about is getting inside. The expats, who arguably enjoy a very rich lifestyle there, would be gone in 60 seconds if the toys were taken away and their salaries only normal. They take their frequent vacations elsewhere.

A related anecdote -- I had several friends in the oil business in Dhahran and in Abu Dhabi. Once, one of them proposed a "gumball rally" either from Dhahran to Dubai and back of from Dubai to Muscat and back. We were going to rent exotics, mine an Aston Martin, and it was no rules, though none of us were likely to go so fast as to be certain of dying. We were going to hire a videographer to film much of it, have t-shirts made, etc. Cost was estimated at $5,000 each for the 6-8 of us, for one long day. Work requirements set it back a year and when we decided to make the run, in the winter of 2003, we were getting everything prepared when either Sheikh Zayed or the Emir of Dubai decided to install speed cameras all along the roads leading from Dubai. We could not figure out an alternate route that would work well enough and the sorta-race fell through. So many Emirati were being killed on the roads (I think many being intoxicated) that the Emir cracked down hard on speeding.

I think that if you can stop over in Dubai for no extra cost, it would be worth a day or two to see, just to marvel at the beautiful buildings and to shop in the souqs at Sharja, the nearby neighboring state. No need to stay at the Burgh, which makes the George V look cheap -- there are plenty of very nice hotels in Dubai and you can get wonderful meals at a variety of restaurants.

As for it ever becoming anything close to the scale of Hong Kong, however, I doubt it.

Anonymous said...

I really dislike Dubai. The place seems to consist mainly of shopping malls, bling hotels and Russian hookers.

Call me a romantic, but when I visit the middle east, I expect to see souks, one legged beggars, flea ridden cats, spice markets, stinking fishing boats, and wailing mullahs, not Wal Mart and casinos.

Dubai Airport is just slightly smaller than Dubai itself and starts with a walk from your plane through Kuwait, past the holy city of Mecca, a quick detour through the backstreets of Teheran to baggage control and out into the Metropolis that is modern Arabia. Not a Arab to be seen, just Russian whores, Euro-failures in Audis and Indians by the million. The whole place is one enormous building site, and I do mean ENORMOUS, which is why I go there.

There is no culture, no feel of ARABIA, no presence, just signs in Russian, English and Arabic offering 75% off branded tat.

The hotels and restaurants are ridiculously luxurious (I have eaten at a so-called SEVEN star restaurant) to the point of embarrassment.

donna said...

Yawn.

Scenery, people?

Boring, dumb-ass sand spit.

ajn said...

This is a fascist state if there ever was one. They import their labor, 90% of labor is foriegn, which they give minimal rights too especially the hotel/construction workers. They are inefficient and extravagent in their spending.

jmf said...

hello from germany,

here is another piece about dubai and the a image of the new skyhigh building that will damonaite the skyline.

megalomaniac!

20% of all cranes worldwide are now at work in dubai

in 2008 they will have finished the buri dubai with 808 metern (2650 ft or 883 yard (watch the image!!!)

in "golbal village"(district) they copy/imitate the world most famous building like the eiffel tower or the tadsch mahal etc. the only difference is that the buildings will include living room and office space and of course all the buildings are bigger and higher than the original.

they are building "dubailand" that will be gigger than the the disneyoarks in florida and california combined.

http://immobilienblasen.blogspot.com/2006/09/dubai.html

Chip said...

AJN: "This is a fascist state if there ever was one. They import their labor, 90% of labor is foriegn, which they give minimal rights too especially the hotel/construction workers. They are inefficient and extravagent in their spending."

You are describing the entire Persian Gulf, with the exception of Oman (and of course, Iran in that they don't import much labor). This has been true for as long as there has been OPEC. I have worked in every one of them, including Iran and Oman.

Anonymous said...

I want to live there. Amazing

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aisha said...

As you know , Dubai is one of fastest growing economies in the world. In past 10 years Dubai changed a lot . I went to chris de burg concert last year and said I am completely shocked when I saw Dubai after 10 years. Right now buying Dubai property will be very good investment at least till 2015.
Just look at these breathtaking pictures- they are awesome!!

Stivel Velasquez said...

There aren't a lot of qualifiers in Ahmad Sharaf's vocabulary. Like his city, he prefers superlatives. As march madness he accelerated his 1995 white Porsche 911 down a grand boulevard landscaped with palm trees and periwinkles, Sharaf, the senior executive of a government corporation, looked out at a city-state that is building the world's tallest skyscraper, largest shopping mall, most luxurious hotel, largest man-made marina and biggest artificial island.
http://www.enterbet.com

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