Further mergers and consolidations are bringing clarity to the Dubai property sector as developers look to restructure debts and the government reorganizes developers under it’s umbrella.
At it’s high RERA, the Real Estate Regulatory Authority, recorded 447 approved developers, however this number is now being scaled back as it developers look to best manage assets and resources and deliver on projects, such as middle income housing which have greater momentum amidst the current economic climate.
Emaar, the largest developer in the Middle East, and now close to completion of the worlds tallest tower, Burj Dubai, stated last week that it is in talks to acquire the property interests of Dubai Holdings. This would bring three large entities – Sama Dubai, Tatweer and Dubai Properties – under the Emaar brand, creating the largest property developer in the MENA region.
“Consolidating these three companies with Emaar is a natural progression in the evolution of the Dubai real estate landscape, providing benefits to all stakeholders,” said Mohammed al Gergawi, the chairman of Dubai Holding.
Dubai World, also last week said that it was in the process of consolidating Leisurecorp, Dubai Maritime City and Dubai Multi Commodities Centre under the Nakheel brand.
“The move aims at consolidating activities of the same nature to better accommodate current market conditions and optimise resources and expertise,” a Dubai World spokeswoman said.
Also still on the cards, is the continued discussion of a merger between Deyaar Development and Union Properties.
“Consolidation is gathering momentum, driven by structural, market and regulatory factors,” said Dirk Buchta, the Middle East managing director of the management consultancy firm AT Kearney, in a report this month. The firm is said to be advising Deyaar and Union Properties on merger options.
From it’s high of 447 registered property developers, it will certainly be interesting to see where we end up. However, one thing is for certain, these mergers are for the good of the Dubai property sector in the short, medium and long term and will help deliver stability for both these companies and their clients and investors.
So, the only question is, who’s next?