International developers and architects keen on eco friendly projects

The environmental impact of new buildings is becoming important as eco property investors increasingly seek out developments that lessen the impact of global warming.

But these kind of properties are also a good investment as more and more tourists and holiday home owners take environmental impact into account not just on how they travel but in choosing where they stay and what they buy.

This comes at a time when property developers are using the eco friendly aspect of their developments as a marketing plus. Bulgaria is set to open its first eco-hotel in 2009 which will conform to the relevant EU standards.

The world's first eco city is under construction on the outskirts of Abu Dhabi in the United Arab Emirates. It boasts it will be zero-carbon, zero-waste and car free. Buildings will be low energy with natural air conditioning towers and water from a solar powered de-salination plant.

Rosa del Mar on Cape Verde's Sal, is one of the very latest eco projects. 'We have designed the apartments to almost exclusively use passive cooling systems over-and-above air-conditioning. Solar chimneys will offer natural ventilation and air-flow without recycling stale air,' said Michael Earle of Costa del Sol architect studio Diseño Earle, one of the leading international firms of eco friendly architects.

'Rosa del Mar will be capped with photovoltaic panels to generate a large amount of the power required in the homes therefore producing a very low carbon footprint, he added. 'All buildings of the future have no excuse but to consider photovoltaic panels, particularly in a sun-kissed environment such as Cape Verde.'

In Thailand Greencore Co Ltd is building Sitara Village, a development designed with the environment in mind. They have introduced height restrictions to limit the visual impact and maintain the natural beauty of Thong Nai Pan Noi.

All the villas are being constructed to incorporate environmentally friendly features such as grey-water recycling and solar energy systems. Alternative transport will be promoted via means of quad-bikes and a non-profitable Sitara bicycle scheme. The local community is also getting involved in Sitara Village through an organic farm-café project using locally grown organic produce. With the needs of the local community in mind, Greencore intend to use the planned Sitara Village community facility to improve educational opportunities for both residents and the wider local community.

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Abu Dhabi a top 10 destination

Abu Dhabi is expected to become a tourism hub over the coming years, because of developments such as Saadiyat Island and the world-renowned museums that are setting up in the UAE's capital. Delegates at an Arab-German tourism meeting in Berlin during the International Travel Bourse were told that the UAE is emerging not just as a regional hub, but a major world destination. Expedia.co.uk picked Abu Dhabi as one of the top 10 places to visit, citing the breadth of things on offer for tourists.

A success story for UAE despite global downturn

16 Apr 2009

As the world continues to marvel at the scale of construction in the United Arab Emirates (UAE), it should also marvel at the rapid growth of the UAE as a top destination for Foreign Direct Investment (FDI). According to fDi Markets, FDI into the UAE has grown on average by 29% annually since Jan 2003 with a total of 1632 FDI projects accounting for $110bn of capital investment and resulting in the creation of over 267,000 jobs.

The largest FDI project into the UAE occurred in July 2005 when Tameer Holding announced the launch of its project - the Al-Salam City in Umm Al-Quwain. The project is expected to cost over $8.7bn and is to be built over an area covering 220mn sq m. The Al-Salam City will be an integrated residential & commercial city, consisting of a number of residential districts*.

FDI figures into UAE rise in 2008

With the 'credit crunch' entering the dictionary in July 2008, followed by the doom and gloom reports of the global recession in the third quarter of the year, it could be assumed that FDI would take a hit. However, contrary to this belief, the UAE achieved above average FDI project figures in the fourth quarter of 2008, as well as the announcement in November of the second largest investment of 2008 when property developer, Sunland Group, stated it would build a 68-storey, $2.2bn sloping silver glass tower called the Atrium on Dubai's beachfront.

In the six year period from 2003 to 2008, the UAE experienced the largest rise in 2008 in terms of both FDI project numbers and capital investment, with a 70% rise on project figures compared to 2007. In 2008, the UAE attracted 480 FDI projects consisting of $4.8bn of capital investment and the creation of over 87,000 jobs. This accounted for a third of all project numbers, capital investment and job creation in the UAE between Jan 2003 and Jan 2009.

Jan 2009 indicates positive outlook for UAE

The UAE started off 2009 on a positive note when one of the largest FDI projects into the UAE was recorded by fDi Markets in Jan 2009. BP announced plans for a hydrogen-fuelled power plant in Abu Dhabi which will generate 420 megawatts of electricity and come online in 2013.

The latest figures released by fDi Markets show that UAE has attracted double the number of FDI projects in Jan 2009 (50 FDI projects) when compared to the same month in 2008 (25 FDI projects). In Jan 2008, the average FDI project consisted of $122.62mn resulting in the creation of 354 jobs, yet in Jan 2009 the average project consisted of an investment of $95.74mn and the creation of only 187 jobs. Although the average project in Jan 2009 was smaller than those in Jan 2008, the increase in actual project numbers shows the sustained attraction of the UAE at the beginning of 2009.

Construction and Extraction the most Valuable type of FDI

The most popular activity for FDI into the UAE in 2008 was business service activities.  This is primarily due to the sheer number of FDI projects in the business services and financial services sector.

However, when analysing the investment capital across activities, the construction and extraction-type activities have involved the most investment primarily due to being heavily capital intensive. The average capital investment per project into the UAE in 2008 was $73.7mn, yet although there was only one project in the extraction activities in 2008, this was made up of a vast $506.6mn. This project into Abu Dhabi occurred in November with ConocoPhillips (USA) announcing its multi-billion dollar project to develop a sour gas field in the United Arab Emirates. The average project involved in construction accounted for $427.8mn.

Since Jan 2003, fDi Markets recorded 15 FDI projects into the UAE with a value of over $1bn. Eleven of these are involved in the construction activities. Interestingly, the other four projects were involved in electricity activities and the manufacturing of oil. As the UAE fears of shortage of power, this FDI has located in the UAE to accommodate those needs.

Motives for setting up in the UAE in 2008 included one by Hebert Smith, a U.K. based law firm who opened an office in Abu Dhabi in 2008; they stated: "Having an office in Abu Dhabi will enable us to enhance our service to existing clients based in the Emirate and to participate in the extraordinary development of Abu Dhabi that will occur over the coming years."

When Singapore firm Wong Partnership announced it was to open a new office in Abu Dhabi, Paul Sandosham, Head of the Middle East practise commented: " ''We recognise the tremendous growth in the Middle East region, fuelled by increasing oil prices and the desire of the UAE to develop and compete on the global front".

Source: fDi Intelligence, Financial Times Ltd

Abu Dhabi's real estate market to stabilise in 2010

Philip Gray, UAE Country Manager said, 'The report gives an overview of the Abu Dhabi real estate market across residential, commercial, retail and hospitality sectors and comments on the Emirate's outlook in light of the current economic conditions.'

'The report concludes that Abu Dhabi's real estate market is relatively well placed to weather the economic downturn, given that government-backed real estate organisations in the city are well funded and have the capacity to rationalise, phase or delay developments to mitigate oversupply risks. Furthermore, Abu Dhabi is performing well in comparison to regional and global counterparts across all asset classes,' Gray added.

According to the report, Abu Dhabi's office market is set to remain undersupplied for the next 3-5 years. Despite this, it has experienced a decline in both rental and sales prices in recent months and this trend is set to continue in 2009 before prices stabilise in 2010. However, the city's office market is set to outperform its regional peers and will overtake Dubai to become the most expensive office location in the GCC by 2010.

Office rental rates in Abu Dhabi have declined from the highs of Dhs4,500 per sq m per annum, achieved in prime locations in 2008, to current annual rental rates of between Dhs 3,200 and Dhs3,000 per sq m per annum. The highest annual rental rates are currently being commanded by schemes on Corniche Street which average Dhs3,200 per sq m per annum, whilst rents on Khalifa and Hamdan Streets currently command an average of between Dhs2,850 and Dhs3,000 per sq m per annum.

Office sales prices in Abu Dhabi have declined from the highs of over Dhs2,300 per sq ft achieved in prime locations in 2008 to current rates of Dhs1,800 per sq ft. This is due to substantively reduced levels of liquidity combined with a decreased appetite for real estate as an investment class.

The report goes on to outline that the proportion of Grade A office stock will grow significantly in the Abu Dhabi metropolitan area as the forecast development pipeline is delivered to the market.

The majority of this new office space will come from master planned schemes such as Al Suwwah; Al Reem; Saadiyat Island and Al Raha Beach which will shrink the current undersupply of office space considerably over the next 3-5 years taking the GLA from 1.3 million sq m - as of Q1 2009 - to 2.7 million sq m GLA by 2014.

As with the office and residential sectors, Abu Dhabi's hospitality market has also been undersupplied and characterized by a lack of internationally branded hotels. This is set to change with the launch of 12,000 new hotels rooms over the next two years alone - rising to over 20,000 units by 2012.

Average room rates in Abu Dhabi have witnessed an increase of 54% from Dhs676 in 2007 to Dhs1,040 in 2008 which placed the Emirate 4th in the world rankings behind Moscow, Geneva and Dubai. Revenue per available room (Revpar) increased by 7.9% between 2007 (Dhs786) and 2008 (Dhs848) maintaining Abu Dhabi's 4th place position in the global rankings.

Source: DTZ, Middle East