Real Estate and Construction Sector in the UAE: Growth Strategies: Abstract
In the last five years, the GCC has experienced a record boom in the infrastructure sector. Construction projects in the GCC exceeded $1 trillion, with two-thirds of the projects being undertaken in the UAE. The construction and real estate sector in the UAE posted double-digit growth on a year-on-year basis and contributed 15% to GDP. The unprecedented growth in the UAE’s construction and real estate sector had Dubai and Abu Dhabi observing the highest increase in the number of construction projects. Dubai has seen a major boom in the construction and real estate sector, making it a hub for some of the world’s biggest construction companies, including Nakheel PJSC and Emaar Properties PJSC. Abu Dhabi is also a major hub for construction companies, including Aldar Properties PJSC. Significant construction projects have also been carried out in other emirates.
Diversification remains the key to achieving sustainable growth in the UAE and the government is firmly focused on encouraging the non-oil sector to maintain its major role in the country’s economy. The sector’s key drivers include, among others: a growing expatriate population, ample liquidity and a friendly regulatory environment. Moreover, as a regional hub for investments, the UAE attracts international companies to establish offices. But the debt crisis that followed the world wide economic recession has had an impact on the sector.