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Emaar looks abroad for growth
DUBAI - Dubai's Emaar Properties will focus its efforts abroad and on non-property sectors such as hospitality and hospitals, the company said on Monday, as a real estate crunch hits its home market.
- PUBLISHED: Mon 4 Jan 2010, 6:06 PM UPDATED: Mon 6 Apr 2015, 10:23 AM
On the day it opens the world's tallest building, Burj Dubai, Emaar said it was not considering a merger with unlisted rival developer Nakheel.
Emaar said the $1.5 billion tower would provide a 10 percent yield for the firm and that the opening would boost earnings for most of 2010.
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But investors took little heart from the outlook and sold Emaar shares down 2.2 percent, pulling Dubai's broader index down 2.1 percent
Emaar cancelled a merger in December with the property units of Dubai Holding in a dramatic strategic reversal following the financial implosion of companies tied to government-owned Dubai World, one of the emirate's largest conglomerates.
“All the studies which we made, we couldn't find a way ahead and it wasn't the right time for a merger at this time,” said Issam Galadari, chief executive of Emaar Dubai, at a media briefing.
Chairman Mohamed Alabbar told reporters there were no plans to merge with Nakheel, the largest property company in the Middle East, which is struggling under a collapse in earnings and a debt pile worth around $20 billion..
The Emaar executives put a brave face on the launch of Burj Dubai, saying it was a positive move forward as the emirate's property prices stabilised, despite wider expectations for continued stress in Dubai's real estate sector.
“You have to ask why we are building all this? To bring quality of life and a smile to people and I think we should continue to do that,” Alabbar told journalists.
“Dubai is where our life is. We have beautiful long term plans for development in Dubai,” he said.
Emaar is the Arab world's largest listed developer.
The tower's height, a closely guarded secret, but known to exceed 800 metres (2,625 feet), will be announced Monday night as Dubai's ruler officially inaugurates the opening.
The tower's opening has been delayed twice and, unlike other projects, survived cancellations after the crisis hit the one-booming city.
“We build for years to come. Crises come and go,” said Alabbar. “the world has gone through two years of difficult times. We must have hope and optimism.”