We have been working with asset owners, operators and investors in Dubai since the early 2000s, and have witnessed first hand the boom and bust of the Emirate.

With Ramadan due to start this week, Dubai will slow down until after Eid al-Fitr in July, giving us time to look back on Dubai’s recent achievements: recovering from the 2009 crisis with a revived economy, and now with regulatory processes in place to reduce the risk of another crash.

Travel
Dubai International Airport recently overtook Heathrow as the world’s busiest international airport. As it reaches capacity, Dubai has found a solution that London can only dream about: turning Dubai’s second airport – Maktoum International – into the world’s largest airport, with a capacity of 200m passengers per year upon completion.

The airport will not only be a passenger hub, but cargo will also play an important role as it is connected via a logistics corridor to Jebel Ali Port and Jebel Ali Free Zone – which is host to 7,100 companies. This continued investment in infrastructure reinforces Dubai’s global standing not only as a transfer hub for passengers and cargo, but also as a tourism and shopping destination.

Hospitality
With world class retail, sports and leisure facilities, guaranteed sunshine and easy access, Dubai’s tourism industry continues to boom. From 2003 to 2013, tourist arrivals have increased at a CAGR of 8.3% to reach c. 11m. With Dubai and the UAE hosting the World Expo 2020 and the related investment in hospitality and infrastructure, tourist arrivals are forecast to reach 20m in 2020.

Retail
Retail and wholesale continue to have the greatest contribution to the emirate’s GDP at 29%. Dubai is second only to London as the city with the highest proportion of international brands, as it continues to present the key entry points for retailers looking to take a share in the strong Gulf market. With plans to build the world’s largest mall at a cost of AED25bn, dwarfing the likes of the 350,000m² GLA Dubai Mall, retailers also have the benefit of available high-quality retail space.

However, despite there being over 2 million young residents in Dubai, retailers have to choose locations carefully as shopper trends change quickly with loyalty shifting to more attractive locations as they open.

So will the new boom be followed by another bust? No-one can be 100% sure, but with the new regulatory processes, an increasingly diversified economy, more organic ‘bottom-up’ developments like Alserkal Avenue and the more cautious approach to investment we have witnessed, it suggests there’s no reason to be fearful any time soon.

Christina Röseler