Announcements of lay-offs and projects put on hold have left contractors in the emirate worried
The announcement of 500 redundancies at Dubai government-owned Nakheel, developer of the Palm Jumeirah and part-owner of the newly opened glitzy Atlantis hotel, has underlined the very obvious fact that the property boom is over. There have been a string of lay-offs in the industry, from the 200 set to lose their jobs at the emirate's largest private developer Damac to redundancies at Emaar Properties and EC Harris.
It is much quieter on the road in Dubai this autumn, and the talk in the conference margins is about what the government may or may not do to salvage its vision for the city. The main hopes are the coming new banks for real estate finance and a debt-for-equity swap with Abu Dhabi. Dubai has around $80bn in public debt, while Abu Dhabi has net cash, so a friendly deal is widely anticipated.
Contractors are seriously worried about the outlook for new business when current contracts expire in 18 months' time
A sombre mood has settled over the owners of the 46,000 property units either under construction or delayed in the emirate. Certainly the market for selling new and reselling part-paid off-plan units has collapsed, while resales of the 35,000 units completed since property ownership for foreigners was legalised in 2002 have halved this autumn.
Nakheel has also announced the delay of work on major projects including the Trump International Tower and Hotel on the Palm Jumeirah, the Waterfront, Palm Jebel Ali and the Universe. The developer also says it is delaying long-term infrastructure work on projects including the Frond N villas and Gateway Towers at Palm Jumeirah.
There is still a construction boom in Abu Dhabi and neighbouring Qatar, and many firms are preparing to move on
At Nakheel's Waterfront mega project, work on the Madinat Al Arab, Venetto, Badra and Canal District is continuing as planned. But other phases will be delayed, and it has slowed reclamation work on the Palm Deira, the largest of the Palm island trilogy, while the pace of construction on components of Palm Jebel Ali is to slow down.
Work on the Universe, a collection of reclaimed islands under a similar and already completed scheme called the World, will also be restricted to preliminary studies.
Contractors and builders are, understandably, seriously worried about the outlook, particularly for new business in Dubai when current contracts expire in 18 months' time. But there is still a construction boom in Abu Dhabi and neighbouring Qatar, and many firms are preparing to move on.
Peter Cooper is the author of "Opportunity Dubai", published last month and available on Amazon.com.