The United Kingdom´s Daily Telegraph stated on 9th June ´Abu Dhabi: rich, hot, lots of sand, lots of cranes. Just like Dubai, right? Wrong. In fact, the differences are profound. Abu Dhabi is less frenetic, more cultured, better planned - and, arguably, is now the better bet for today´s canny property investor. It is the richest country in the world, the federal capital of the United Arab Emirates and, if its £100 billion, 10-year vision succeeds, it will become the region´s hottest spot for real estate and cultural tourism.´

Fine praise indeed and it can be backed up with facts. Abu Dhabi generates 60 per cent of the United Arab Emirate´s GDP and has seen a 75 per cent increase in its population in the last decade. Its assets are estimated at USD17million per capita and it has attracted more than USD4billion in inward investment in the last year.

As well as being the political and economic seat of power, Abu Dhabi also benefits from an abundance of energy, owning vast hydrocarbon wealth accounting for 95 per cent of the country´s oil reserves and 92 per cent of its gas. The government has pledged to spend more than AED1 trillion or USD272 billion on construction, power and tourism and has committed to developing specialized economic zones through its formation of Zonescorp. Five industrial cities are being created across 74 square kilometres of land to attract new industries and manufacturing to the emirate. To date there is an anticipated inward investment of more than USD$2.7 billion to establish the first three cities.

Abu Dhabi is not just focusing on industry; it also has big plans for tourism with this sector growing 17 per cent annually. The national airline Etihad Airways is opening more direct global routes helping the city to attract the attention of businesses and residents in these destinations. By 2010, following a USD2.1 billion airport expansion increasing capacity to 40 million passengers annually, the airline aims to fly in visitors from over 70 destinations.

July sees the start of direct flights to Dublin and from September you can fly three times a week non stop to Singapore – a city with whom Abu Dhabi is establishing some significant connections. Two recent announcements are a joint venture between Singapore Property developer CapitaLand and Mubadala Development, to develop real estate in Abu Dhabi. The two partners have committed to investing a combined USD300 million into the joint venture to develop residential, retail and leisure elements, built around existing sports facilities. The project spans a 1.4 million square metre site and includes a two kilometre waterfront area which will be developed over the next four to five years.

In the same week ALDAR Properties, one of Abu Dhabi’s leading property developers has also signed a heads of agreement with Keppel Land Limited, one of Asia’s premier property developers, to develop two prime waterfront developments in Abu Dhabi. The two developments will provide over 4,000 residential units.

The real estate sector is still relatively young but has already announced an estimated USD270 billion in development projects to create much needed additional residential and commercial space for the rapidly growing city. Analysts have predicted that this market will overtake others in the region and that demand for residential property will continue to rise.

In January, Business News stated: ´By the end of the decade Abu Dhabi is likely to overtake its neighbours Dubai and Doha as the biggest construction market in the Gulf…… for real estate investors it is arguable that Abu Dhabi offers the most favourable outlook in the Gulf. Rents will stay on a rising curve, while capital values will be underpinned by high and rising demand.´ Whilst the Oxford Business Group in a report on emerging markets predicted: ´The population of Abu Dhabi is expected to double in the next ten years leading to demand for between 225,000 and 250,000 new housing units.´

There is definitely a buzz about Abu Dhabi both in the media and from investors, so if it isn´t there now, it is definitely one place to have on your watchlist.


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