By Nicole Walter, Features Editor, Property Monthly www.gulfnews.com
The UAE’s constitution envisioned an emirate-independent capital, which would be on the Abu Dhabi-Dubai border and would be called Al Karama. Although the plan has since been scrapped appointing Abu Dhabi as the permanent capital of the Federation, the expansion of the two emirates is likely to occupy the same space.
“There is a synergy between the two cities. I always said there would be an integration between the two on a national level,” says Masoud Al Awar, the CEO of Tasweek. “There is growth now right next to the Dubai-Abu Dhabi border, within the next 15 to 20 years, it will be difficult to see where the border is,” Al Awar is referring to Sorouh’s Al Ghadeer project. And had the global economy not taken a hit and the real estate market slowed down, the landscape in the border areas would have changed even sooner.
Massive developments, or rather ‘cities’, such as Ghantoot’s redevelopment, and the new Forest of Sieh Sdeirah project are still on the drawing board. These would neatly near flow into Dubai’s Jebel Ali Waterfront and Arabian Canal developments.
Even now, industry watchers believe the best way forward would be for Dubai and Abu Dhabi to co-opt their individual development priorities and work towards a common goal. “Despite Dubai being a story of oversupply and Abu Dhabi of undersupply, investors don’t differentiate between the two, but look at the country’s balance sheet as a whole taking a collective view of the risk,” states Saud Masud, UBS’s head of research and senior real estate analyst for MENA.
A unified picture of the two emirates seems to make perfect sense. The question though is whether there will be too much of everything. Up to now, each emirate in the UAE seems to have gone solo as far as real estate development planning is concerned.
For instance, take Dubai World Central, the Logistics and Industrial cities, while Abu Dhabi is also planning to enlarge its offerings in this respect. Dubai’s World Trade Centre exhibition district also competes against Abu Dhabi’s Adnec.
Even Ras Al Khaimah was planning to create a convention zone as the gateway to its emirate, complete with financial centre. Dubai has DIFC and Abu Dhabi will have a dedicated financial district in Sowwah Island.
For Dubai’s Media and Studio cities, Abu Dhabi has a media zone in ‘twofour54′. When it was conceived, Sama Dubai’s Lagoons was to have a cultural heart, including museums and opera house. Once Abu Dhabi’s Saadiyat Island reaches its full potential, it will be the cultural destination of some eminence in the larger scheme of things.
Dubai is ahead with some of these developments and Abu Dhabi is now ahead in others. Would it not make sense to create a federal plan allocating which emirate does what?
“There will be a natural shakeout of who does which element,” reckons Elaine Jones, Asteco’s CEO. “Dubai is the trading and financial hub, Abu Dhabi is the capital just like in any other country.”
She points out that the demographic mix in each emirate is different with Abu Dhabi housing more Arab expatriates and Dubai more Europeans and residents from the subcontinent. Therefore, there is a need to focus on different lifestyles. And those living in the northern emirates have yet another reason to be there.
“They have businesses in Dubai and Abu Dhabi, but they choose to live in the ‘countryside’ because they want a more relaxed life,” Elaine adds.
While for now each emirate needs to put its house in order, simultaneously engaging in communication on what to build and where would only benefit the country as a whole. “I think the play-off between Abu Dhabi and Dubai going forward is going to be a very interesting story,” says Steven Morgan, who is head of Cluttons’ Dubai office and also oversees the Abu Dhabi operations. “Ultimately, the emirates are stronger as a group than as seven individual emirates.”
He advocates something of a UAE 2030 urban plan focusing on real estate, utility and transport infrastructure, including a federal law on property and best practices.
“It needs to be looked at very sensitively without losing the very different identities of each of the emirates,” Morgan says.