Dubai must focus heavily on continuing to attract expatriates and foreign companies, says a leading property developer.

“I believe we will soon see the bottom of the current crisis but if we are to avoid the boom and bust cycle of the recent past, Dubai must return to the basics which first put it on the map,” said Mohammed Nimer, CEO of mid-market development company MAG Group Properties.

“Dubai was hugely successful before the real estate bubble,” said Nimer, whose company has Dh3 billion ($817 million) worth of construction projects in the UAE. “As the Arabian Gulf’s most globalised economy, Dubai’s existence has been driven by its power to attract foreign direct investment and the resources necessary to make it work.

“Dubai, a once small pearling village with limited natural resources, led the region in declaring a tax-free, business-friendly environment, attracting outside investment and a large highly skilled expatriate population.

“The basic pluses for Dubai that brought them here have not disappeared in the financial and real estate crisis. Dubai’s geographical position will never change and it remains the primary hub connecting Asia to Europe. It also connects Asia to Eastern, Western and Southern Africa, as well as becoming a gateway from Asia Pacific to South America,” he said.

“Dubai’s infrastructure cannot be bettered by anywhere else in the Middle East. Jebel Ali is still the world's largest man-made harbour, the biggest port in the Middle East and home to 5,500 companies from 120 countries. Dubai international airport is the sixth busiest in the world by international passenger traffic and one of the busiest cargo airports in the world.

“What this emphasises is that Dubai’s dependency on the outside world cannot be ignored. The future domestic economy must focus heavily on expatriates and foreign companies and its business relationships with the rest of the world. Now, however, there must be greater transparency, tougher regulations to protect investors and a basic safety net on provisions for the expatriate community upon which the economy is dependent.

“We need to ensure that the UAE remains a safe and secure community and that its tax-free and business-friendly environment is strengthened. Population and employment are basic fundamentals which underpin the UAE economy and reforms which ensure growth are essential to maintain them,” said Nimer.

“Solid fundamentals like these which lead to a sustainable recovery and affordable – not speculative - housing whether owner-occupied or rented, lie at the heart of the solution.”

In the shorter term, Nimer said there is still a large supply of new residential and commercial property to be absorbed by the Dubai market. Lower rents and values would ensure that the supply is taken up and “only then will the Dubai property market be stable,” he added.  –TradeArabia News Service