Dubai’s property market could see a “cooldown”, one of the UAE’s biggest developers has said, as he insists “smart capital” will continue to invest despite Iranian missile attacks.
Mohammed Alabbar, founder of Emaar Properties, the company behind the Burj Khalifa skyscraper, told CNBC’s Don Murphy that “there could be a bit of a cooldown, but I don’t really see it,” adding that the UAE’s real estate business is “not built on bank debt.”
“Bank lending is really constrained in this market. Consumer confidence will be shaken a little bit, but as I said, the policies in this country will bring confidence back very quickly,” he said on Thursday.
He was speaking on the sixth day of the escalating war in the Middle East, in which the UAE has been hit by retaliatory attacks from Iran after the US and Israel launched strikes against Tehran on Saturday.
Countries have repatriated their citizens. Dubai’s airport, one of the world’s busiest, disrupted flights, as did hotels and ports across the country.
“I was surprised and I was shocked,” Alabbar said of the strike. “But people with real capital understand what a country like this can deliver with stable leadership and the security it has shown. They will double down on this.”
He insisted that life was gradually returning to normal, adding that footfall at the Dubai Mall had already returned to 190,000 visitors daily, compared with 250,000 daily before the war.
“The number of customers that come to our restaurants, our numbers are about 80, 85% and it’s only four days, five days,” Alabbar said. The Dubai Mall is owned by Emaar Properties and is located next to the Burj Khalifa. “Life is getting back to normal,” he said.
Asked why Iran chose to target the UAE, Alabbar said: “It’s a global trade hub… where prosperity should be, what positivity should be, this is the place.”
“So I think it’s only natural that … people who have no respect for progress, no respect for a good quality of life, maybe they think that’s one of their goals. But thank God, it’s not going to be,” B
Iranian Foreign Minister Abbas Araghi was reported to have said that the attacks “were not targeting our brothers or neighbors in the Persian Gulf. But we were targeting US targets.”
However, other experts told CNBC that the rich are leaving Dubai.
Dale Buckner, CEO of security firm Global Guardian and a former Green Beret, told CNBC on Tuesday morning that the firm has seven corporate clients, including large financial and consulting firms, looking to relocate 1,000 to 3,000 employees.
“It looks like Ukraine,” he said.
“The US-Israel war over Iran is raising a critical aura of security in Dubai,” Jim Crane, a fellow at Rice University’s Baker Institute, told CNBC this week.
“Dubai’s economic model is based on expatriate residents who provide brains, guts and investment capital. You need stability and security to bring in smart foreigners,” added Crane.
But Amir Naran, CEO of Vimana Private Jet, told CNBC that Dubai residents were traveling for business meetings, not fleeing for safety.
“They don’t feel unsafe,” he said. “A little extra noise in the background of all these missiles is normal. But life has to go on. They have to travel.”
