Children of the crisis

Financial crisis that had combusted in September 2008 has severely impacted property markets and construction industry sectors of various states. Not everyone was, however, conquered by it.

142 high-risers (11% of total 1324 projects) have been shelved during the last six months. Among others, the construction of Europe’s tallest skyscraper that was to be built in Moscow has been frozen. In the country most intensively developed during the last decade, UAE, a number of projects totally worth $335 billion have been suspended or cancelled. This January in USA the volume of new residential housing construction has reached its 40-year record low.

Mainly those projects that have succeeded in acquiring financing before the bank liquidity declination and credit terms stiffening are currently being realized. Beside that, various governments support local stagnating economies by investing in the development of infrastructure and social housing. On the contrary, hotels, resorts and skyscrapers priced more than $1 billion, which have been so frequently reported of barely a year ago, still remain on a drawing-board.

In some areas, however, large-scale residential and commercial projects continue to appear regardless of the crisis.

Dubai
In the beginning of October 2008 developer company Nakheel has confirmed its readiness to construct a skyscraper Nakheel Tower. The tower is 1000 meters tall, which will allow it to outscore the Burj Dubai building that is also located in the emirate. The skyscraper will be included in the 270 ha-large Nakheel Harbor and Tower project. Residential part of the multifunctional tower will accommodate 55 thousand tenants. Commercial part of the high-riser is designed for 45 thousand workers.

Several days later Meraas Development company has announced its plans to construct a new neighborhood Jumeirah Gardens, which is viewed as “a town inside a city”. Its estimated price is $95 billion. The neighborhood is scheduled to be commissioned within 12 years. A water canal which will split the Jumeirah Gardens is also planned for construction.

Subsequently Tameer Holding Investment has promulgated its project of a water-turbine-shaped skyscraper with its upper part resembling a propeller. The construction of the Anara Tower (200 meters tall) is scheduled to begin in 2009. The building will include residential, office and retail facilities, as well as a hotel, art-gallery, gardens and an elite restaurant.

Saudi Arabia
In October 2008 Kingdom Holding Co. has announced its plans to build a kilometer-tall skyscraper in one of the kingdom’s first-tier cities – Jeddah. The tower will become a part of the Kingdom City project which is totally worth $26.7 billion. The overall floor area of the development that incorporates residential, entertainment, retail and hotel facilities will amount to 7.1 sq. km. Up to 80 thousand tenants will be able to simultaneously reside in the Kingdom City.

Six agreements regarding the construction of a large-scale project “Prince Abdulaziz bin Mousaed Economic City” located in Ha’il province have been inked in February 2009.  Its floor area amounts to 1.5 sq. km. The complex will include residential units for 300 thousand tenants, passenger and freight terminals, schools, mosques, parks recreational facilities and shopping malls. Construction works are expected to be finished by 2025. The cost of the project remains confidential.

China
In November 2008 Shanghai’s authorities have started to build a 632-meter-tall Shanghai Tower, its total cost is $2.2 billion. 121-storey building will incorporate offices, retail space, a hotel and cultural facilities. Architects claim that the tower will become one of the most ecologically friendly buildings in China. It’s scheduled to be put in commission in 2016.

Jordan
In February 2009 a developer company Al Maabar has announced the construction of a yacht-resort Marsa Zayed, totally worth $10 billion. A 3.2 sq. km. large project will accommodate residential property units, hotel-recreational facilities, business and retail space, as well as several yacht piers and a terminal for cruisers. The project is located in the city of Aqaba, which is the only sea-port and resort in Jordan. The realization of the project will begin in 2010.

Romania
In September 2008 Carpatia Resorts developer company has finished the acquisition of a land parcel in Transylvania. The 3.6 ha-large plot will include 5-star hotels, casinos, a conference-center (the largest in Romania), medical center, spa, shopping mall, ski-resort and a concert hall. The construction will begin in April 2009.

Tanzania
Investment company Integrated Property Investments in cooperation with African residential construction association Shelter-Afrique have signed an agreement to construct a Bahari Beach Town near Dar-es-Salaam city (the project’s total cost amounts to $500 million). Over a thousand elite residential property units, a five-star hotel, office building complex, ferry terminal, a yacht club and well developed ecotourism infrastructure are all included in the project. The first stage will be commissioned in 2010.

…and others
A realization of office property projects totally worth $15.7 billion is currently ongoing in all member-states of the Gulf Cooperation Council. 74 projects are scheduled to be commissioned in 2009, 82 – in 2010. Finally, according to a CB Richard Ellis report, roughly 23 thousand rooms in 4- and 5-star hotels will be commissioned in Singapore, Bangkok, Hanoi, Ho Chi Ming and Kuala Lumpur by 2012.

Author: Alexey Lahov