Damac CEO resigns
Peter Riddoch, the CEO of Damac Properties, is resigning from his position in October. No replacement for Riddoch has been appointed, nor did he name the reason for his resignation. In his last statement, Riddoch only said: “I know that the time is right to make some changes, focus a bit more on my personal interests and family, and possibly even take on new challenges.” Riddoch began has career at Damac in 2003. According to Arabian Business, Hussain Sajwani, chairman of Damac Properties, said he accepted Riddoch’s resignation unwillingly but wishes him success in his future.
Arabtec in St. Petersburg
Arabtec Construction LLC, a leading UAE-based construction company, was awarded the contract to build Europe’s tallest building in the Russian city of St. Petersburg. The project, known as Okhta Center, is owned by Gazprom Neft, a subsidiary of the state-owned natural gas giant Gazprom, and will be used as the company’s headquarters. The tower is presenting a threat to the historical image of the city, since the United Nations Educational, Scientific, and Cultural Organization (UNESCO) warned that the city’s center could be removed from the World Heritage list if the tower is built, according to the UAE daily newspaper The National. On September 2, a public hearing took place in the city where residents protested, claiming that it was wrong to change St. Petersburg’s zoning laws in order to build the project. During the meeting, six people were thrown out after disputes with security guards and the police, according to the newspaper. The contract was awarded in March last year, but faced delays due to design changes aiming to reduce costs. The original contract, valued at $2.72 billion, was cut to $817 million. Ziad Makhzoumi, the chief financial officer at Arabtec told The National that if the approval is given, work should start by the end of March 2010.
EEC teams with Binladen Group
The Saudi-based Emaar Economic City (EEC) announced September 6 that it has agreed to form a joint venture with Saudi Binladen Group (SBG) to finance, develop, and operate the port at King Abdullah’s Economic City on the Red Sea Coast. The EEC board had approved a preliminary agreement with SBG over the joint venture the day before, according to the company. Work on the first phase of the port was expected to begin as of the end of last month, and it is slated to be operational by 2012. The cost of the first phase is estimated at $1.07 billion. At the same time, according to the Saudi Stock Exchange Tadawul, the EEC canceled the $373 million contract with SBG awarded in April 2008 to build 16 residential towers. The cancelation was due to the decrease in building material costs and reconsideration of the development. The $31 million EEC already paid for the project will be retained by the contractor for works already executed on the development.
Real estate optimism at Saudi Build 2009
The Saudi Arabian real estate sector is projected to grow by 5 to 7 percent each year until 2012, and contribute 7.2 percent of gross domestic product in 2009, according to a recent study by the Kuwaiti investment company Global Investment House. The report also said Saudi real estate investments will reach $300 billion in 2009 and $400 billion by 2010. As the real estate and construction sectors continue to grow, it is expected that Saudi Build 2009, the annual construction trade exhibition, will also witness success with more than 650 regional and international companies already signed up, according to Riyadh Exhibition Company, the event’s organizers. More than 38 countries from Europe, Africa, the Middle East and Asia are already represented in the exhibition, and the number is expected to grow.
Alumco Qatar inks Doha deal
Alumco Qatar, part of the Lebanese Alumco Group, won a contract for the installation of 31,000 square meters of aluminum cladding and 48,000 square meters of stick system curtain walls, windows and doors in the Barwa Commercial Avenue mega project in Doha. About 250 people are expected to be employed due to the announced contract. Moreover, it was announced in Aswaq Aliraq in early September that the Thi-Qar Investment Commission approved the engineering design submitted by a Lebanese company for the construction of a residential compound in Nasseriya city, Iraq, which will be comprised of 1,800 buildings with eight floors each. The name of the company was undisclosed.
Dubai contracts Arabian Construction
The Lebanese construction firm Arabian Construction Company (ACC) won the contract to build a $397.5 million, 124 story skyscraper in Dubai. ACC will be building the “Pentominium” tower in Dubai Marina, which will be the tallest residential tower in the world, and Dubai’s second tallest building after Burj Dubai. The contract was awarded to ACC by the Dubai-based Trident International Holding, and the project is slated to be finished within two years. The tower will include a sky lounge, business center, sky pool and an observation deck of above 400 meters. The Pentominium tower is not the first to be built by ACC, which has 12 offices throughout the Middle East and operates in seven countries. ACC’s other projects include the 30-story Silver Tower, Sorouh’s Sky and Sun towers, all located in the UAE capital Abu Dhabi.
Property driving Lebanon’s economy
The real estate market is Lebanon’s main economic driver, accounting for 45 percent of total investment, according to a report published by American real estate brokerage firm Coldwell Banker. The report projected the size of the sector will reach $6 billion by 2010. Real estate activity soared in the months following the June parliamentary elections after a period of relatively slow growth. While Lebanon has been indirectly affected by the global financial crisis, the fact that some 90 percent of property buyers are end-users has taken the edge off speculation that has afflicted the Gulf countries. Moreover, regulations issued by the central bank have sheltered the sector from risky lending. The loan-to-value ratio allowed does not surpass 70 to 80 percent, and falls back to 50 percent if the individual wants to purchase a second apartment. The report also added that foreign investment accounts for 10 percent of the total real estate investment, and it is expected to increase to about 20 percent in the near future.
Tourist village slated for Petra
Construction of a $50 million tourist village near the ancient city of Petra in Jordan is expected to start by year’s end, according to The Jordan Times. Financed by Saudi-based Pharaon Commercial Investment Group (PCIG), the project is slated for completion in 30 months, and will be comprised of a 100-bed, five star hotel, a shopping center, a multipurpose conference hall, restaurants, a spa and a swimming pool. According to reports, the government has received guarantees on the preservation of the globally renowned archaeological site of Petra and the surrounding environment. The village is expected to create jobs for locals, while 15 percent of the project’s revenues are earmarked for community development. The head of PCIG, Sheikh Pharaon, said in a press conference that specialized companies are working on the project design, and are submitting blueprints to the concerned authorities.
Deyaar’s low-cost Beirut housing
The Dubai-based Deyaar Development company is planning to start its second project in Lebanon after launching the $100 million Saifi Village II development in June. The company is to build low-cost housing in the Beirut area in cooperation with Solidere. “Beirut is tremendously expensive,” Markus Giebel, CEO of Deeyar, told Maktoob Business. “If you build low-cost housing that’s close to the city, you could end up with solid returns over the long term and a new development model.”
If Solidere backs the project, the two developers will negotiate with the government to allocate the land and for banks to provide mortgage financing for buyers. Back in June, Giebel told Executive that Deeyar has a total of $200 million invested in various projects in Lebanon. Saifi Village II, the first development by Deyaar in the country, is part of the Beirut City Center master development.
Israel authorizes settlement expansion in occupied Palestine
Despite continuing pressure exerted on Israel to stop the construction of new settlements, the Israeli government has given the go-ahead to expand settlement construction in the occupied West Bank. Last month the Israeli Defense Minister Ehud Barak authorized the construction of 455 new residential units in the occupied Palestinian territories. A few days after the decision was taken, Israel reopened the tendering process for 486 new homes in another settlement in annexed Arab East Jerusalem, according to AFP. The Israeli government has said that “it would approve a burst in construction before considering a United States demand to halt settlement activity.” The unilateral decision has been opposed by the governments of the United States, Europe and Egypt.
Israeli settlers have also said they will resist any partial freeze on the construction of new settlements. According to the Yesha Council, the main settlers’ lobby in Israel, 2,000 young Israeli couples will require new homes to be built every year as the current and projected supply is not sufficient to meet demand.
“We have more demand than offers… the threat of a freeze would be a disaster for the development of our village,” said Tamar Castelnuovo, a real estate agent in the Tekoa settlement in Nokdim, south of Bethlehem. However, community leaders in the settlements still seem unimpressed with the number of building licenses granted to the settlers. Commenting on the first decision, Pinchas Wallerstein, the director general of the Yesha Council, said, “It is an insult to our intelligence; we are very disappointed by this announcement.”
Chief Palestinian negotiator Saeb Erakat said the move “undermines faith in the peace process, and the belief that Israel is a credible partner for peace,” according to AFP. Palestinian president Mahmoud Abbas said the plan was “unacceptable” according to the news agency.
