Monday 25 March 2019

Abu Dhabi's active building projects' value hits $62.8bn

ABU DHABI, April 18, 2018

The total value of the over 1,200 residential and commercial building projects in Abu Dhabi has exceeded $62 billion, according to BNC Network, a major project intelligence provider in the region.

Of the more than 1,600 active projects in the urban construction sector, 76 per cent belong to residential and commercial buildings category. However, when split on value of the projects, 41 per cent of the projects belong to the residential and commercial buildings category while the remaining 59 per cent belong to other urban construction projects such as hotels, hospitals and malls, the report stated.

This means that the average value of other urban construction projects is higher than that of the residential and commercial buildings projects, it added.

BNC report said around 700 projects with an estimated worth of $21.6 billion belong to low-rise residential and commercial buildings while more than 350 belong to mid-rise categories worth $16.5 billion and 210 worth $24.7 billion are high-rise towers.

Approximately 700 projects worth over $16 billion of the total projects are under construction while over 60 residential and commercial building projects valued at $2.3 billion are currently being tendered. Approximately 130 projects worth $7.3 billion are in preliminary stages of the construction life-cycle.

Avin Gidwani, the chief executive officer of BNC Network, pointed out that Abu Dhabi was a major economic power backed up by large hydrocarbon reserves that put the emirate’s economy on solid ground.

"However, low global oil prices in the period of 2014-2017 compelled oil dependent economies to undertake conservative growth strategies, resulting in a slowdown in construction activities," he explained.

"This is expected to be a temporary phenomenon as crude prices hover around the psychological $ 60-70 per barrel, investment in housing projects and other development initiatives is expected to increase," stated Gidwani.

“We would expect to see a surge in the construction activities in Abu Dhabi in the next few years, if the current level of crude oil prices hold. As it stands, major Abu Dhabi developers have already started announcing new projects, especially in the affordable home segment,” he added.

As per BNC Construction Analytics, Abu Dhabi projects are part of the more than 8,300 active residential and commercial building projects in the UAE, valued at over $237 billion.

Of these, 1,100 high-rise residential and commercial building projects represent more than $108 billion in value, while 4,700 low-rise building projects represent almost $68 billion and 2,500 odd mid-rise buildings are worth almost $60 billion.

BNC data shows the residential and commercial buildings worth over $105 billion are currently being tendered or are currently under construction – while projects valued at over $90 billion are on hold and projects estimated at $41 billion are in either concept or design.

In terms of the number of projects, 84 per cent are residential and commercial buildings while the remaining 16 per cent belong to the other urban construction projects.

However, in terms of the value of the projects, residential and commercial buildings represent 45 per cent of the projects. This means that 16 per cent of projects constitute 55 per cent of the  total value of projects, said Gidwani.

According to him, the UAE’s construction project market is currently being driven by the anticipated footfall demand for the World Expo 2020 – that necessitated the upgradation and expansion of infrastructure as well as the addition of new housing and hotel projects – to accommodate a large number of visitors to the emirates.

"Over the course of the next two years most of the currently ongoing construction work will be completed," he added.

Tags: abu dhabi | Residential projects |

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