Emaar's Chairman Says Dubai Needs 20 Months to Overcome Oversupply

---

(NEW YORK, NY) -- Speaking on a panel in New York yesterday, Emaar's Chairman Mohamed Alabbar testified to the huge change in Dubai real estate by saying that prices will keep dropping as the result of too many properties chasing too few buyers. His remarks at the Bloomberg Link Real Estate Briefing were reported by Bloomberg and quoted in today's Arabian Business.
 
"We need 20 months or so to go over the excess supply," he said and noted that 18 months ago prices in Dubai were higher than in New York which he termed "abnormal." Alabbar's comments are relatively optimistic. Many analysts believe it will take longer for newly completed and close to completion offices and residences in Dubai to be sold or rented.
 
Some reports put Dubai prices now at 50 percent less than at the peak of what proved to be a bubble in 2008 and Abu Dhabi's at 30 percent less. As a result, Alabbar said that Emaar plans to generate 50 percent of its income outside its home market in the next few years in Syria, Lebanon, Algeria, Saudi Arabia, and Egypt. That is a major switch from the current 80 percent of revenue earned in the UAE
 
In Abu Dhabi where the economy has been stronger during the downturn, the major developers are feeling the pinch. According to a report by Bank of America Merrill Lynch, Aldar, the emirate's biggest real estate developer, needs a cash infusion of $2.7 billion by the end of the year to "survive." The resignation this week of CEO John Bullough punished Aldar stocks. A new CEO is expected to be named Monday when the board meets.

---