Abdulla Bin Sulayem is the operations director of Palm Deira, which will be the largest man-made island in the world and a new city within Dubai for more than a million people. It is the final part of The Palm Trilogy consisting of Palm Jumeriah, Palm Jebel Ali and Palm Diera. Nakheel, the world’s largest privately held real estate developer, is driving the project. Nakheel now has 16 major projects under development in Dubai across a range of sectors. The company’s portfolio spreads across more than two billion square feet of land and is projected to be worth more than $30 billion.
E When did Nakheel start construction on Palm Deira and what stage has the project reached?
In 2003, the deal was signed between Nakheel and Van Oord, the company that is creating the island for us. Right now we have more than 36 percent of the island completed, which is equivalent to more than three times of what is available at the Palm Jumeirah in terms of land area. Currently, more than 50 percent of vibrocompaction is completed, which basically makes the land stable and ready for construction. That is the same method we used in Palm Jumeirah and that people use all over the world. Palm Deira will eventually hold a population of 1.3 million people. The difference between Palm Jumeirah and Palm Deira is that Palm Deira is going to be a city on its own. It will have a lot of facilities, offices, retail, swimming pools and even firefighters; everything that you find in a normal city will be available in the Palm Deira. One of the reasons for this is that we have tried to minimize the traffic going in and out of the Palm, so if you live there you can work and be entertained there as well.
E Has the construction at Palm Deira been affected by the ongoing financial crisis?
These difficulties come from corporate Nakheel. We work together with them to adjust our business plans. Obviously the financial crisis is affecting the whole world and changing plans. What is good about Nakheel is that we took a lot of sukuk funds from the market, so we have secured a good amount of cash to finance the project. Nakheel is thinking to complete the committed projects, where people already paid for villas and apartments. For other projects, we will have to readjust our master plan based on the market conditions.
E Are some parts of the Palm Deira projects going to be delayed because of the market conditions?
I would not say delayed, but we are re-examining the programs and making them more flexible. Some properties that were sold to investors, we are continuing to complete these and have the land ready for them. Other than that, we have one bridge that is already under construction and that is still ongoing. We have our sales office that was under construction, which is going to be completed in a month’s time.
E What about delivery times? Are they the same as planned?
Of course the delivery of the project will all depend on the market conditions. If we have a commitment to someone, we are still committed. The other parts that we were thinking of creating or planning to do, these will be slowing down until the right time comes.
E In November, you denied rumors that the project was on hold. Where did these rumors come from?
At that time some information was given to the public that we are stopping Palm Deira, which was incorrect. So in November we came out to the press showing them that we are still continuing. Of course with the financial crisis, we would not be continuing as fast as we were before, but the project is not canceled and that was our message. We still have a team of over 100 staff from Nakheel in Palm Deira working on the project. Mainly in Palm Deira there were many rumors before, maybe because of the prices of villas and there is a lot of history behind it. But what is good now is that we have more than 36 percent of the island completed and we showed that in November, so after that period we felt the market now understands we are still going ahead with the project. It could be because of the magnitude of the project, people weren’t sure that we would go through with it. Of course the crisis has had an effect on everyone and we are not moving as fast as we were moving, but that is the sensible thing to do since our direction is based on the market. For example, if we were planning to sell two bedroom apartments and demand is there for one-bedroom apartments, obviously we will divert to the demand. We have one private investor that joined the venture with Nakheel. We have not announced their name yet and maybe this month or next month it will be announced. This private investor will jointly construct 50-50 with Nakheel a development that is to be announced.
E Have you launched any part of the project yet?
No, not yet. The launch will depend on market conditions. So the launch will be 50-50 with the private investor. It will be launched in stages depending on market conditions.
E Congratulations for winning the developer of the year award. What do you think made your company the winner?
I would say that we have good management, which believes in empowering the business unit to come up with ideas. Nakheel is working in a very healthy environment and what we like to do here is show our experience in different areas, so we always come up with innovative ideas.
