For the past couple of years, the rich Gulf State of Dubai has been on a building spree of mythic proportions. There’s an underwater hotel, an indoor ski resorts, the world’s highest apartments, and the largest mall. They’ve built a series of man-made islands shaped like palm trees, and another shaped like different parts of the world (the ultra rich can buy an island representing the nation of theri choosing. There’s the now-iconic hotel shaped like a sail, a planned Marvel Superheroes Theme Park, and blueprints for the world’s tallest building. And of course there are ambitious golf courses, including Tiger Woods’ first design. Dubai also is the host and financier of the European Tour’s version of the FedEx Cup—the Race to Dubai.
But the times are changing. The now worldwide real estate market correction, combined with credit tightening and falling oil prices has left Dubai in a bit of a pinch.
Dubai real estate prices could fall as much as 60 per cent this year from their peaks in July last year, while Abu Dhabi may slide as much as 20pc, Shuaa Capital said yesterday.
Real estate prices have fallen by around 40pc in Dubai and by around 15pc in Abu Dhabi from their peaks last year, the Dubai-based investment bank vice-president for research Roy Cherry said, adding that rents in Dubai are likely to fall some 20pc in the next two years.
“Dubai is seeing a negative growth in demand for real estate,” Cherry said.
Meanwhile, the Mid East News Source has reports of construction in Dubai being abandoned.
The dream of a skyline that would soon have matched Manhattan’s may be on hold as Dubai’s once stellar property and construction boom slows from its previously frenetic pace to a more sedate one, in which many projects have been either suspended or completely abandoned.
It is an oft-quoted fact that 20 percent of the world’s cranes are in the emirate, but now many of them stand motionless and once bustling construction sites are empty, save for the few security guards posted at the gates.
When reports of the financial crisis facing the world’s economies first emerged, many observers in Dubai were quick to quash any suggestion that it would affect the desert city; but it has, and the shockwaves have rippled throughout the city.
And apparently the Arabs have a history of literally abandoning project to the sand. Will Tiger’s golf course actually be completed? The company developing the course, Tatweer, recently stopped construction on a couple of buildings in Dubai Health Care City. The parent company of the developer, Dubai Holding, plans to cut 2009 spending by 25%
In the meantime, Tiger apparently is spending money like—well, sand. Nearly 4,5000 trees are scheduled to be transplanted to create the look he desires. They’ve moved enough earth to create a 255 foot peak. Overall, the entire complex—course and associated properties—will cost $1 billion.
Right now, Tiger Woods Dubai is on track for a late 2009 opening. We’ll see what happens if oil prices continue to stay down.
What all of this foretells for the larger sport of golf remains to be seen. Surely the deep pockets of the Emirates have played a huge role in the calculations of the European Tour. I’d be interested to know what’s “Plan B” if the oil money dries up. More dependence on China, surely. They have the advantage of being able to clamp down on their
slaves citizenry and force them to pay for the egotistical ambitions of their leaders. The people will starve, but golf will go on.