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Al Habtoor forced to look overseas for contractor

Habtoor Dubai Al Habtoor
Al Habtoor Group is seeing increasing competition for contractors as it develops Habtoor Tower in Dubai
  • Dubai developer seeks workers in China and India
  • UAE contractors attracted to Saudi construction market
  • Competition is fierce due to level of activity

Billionaire Khalaf Al Habtoor had to look to China and India for a contractor for his latest Dubai development as experts say Saudi Arabia’s construction boom is impacting UAE projects.

The founding chairman of the Al Habtoor Group (AHG) broke ground on the Habtoor Tower building earlier this month.

AHG was previously involved in building the Burj Al Arab, Dubai International Airport Terminals 1 and 3, and Abu Dhabi Officers’ Club, among others.

Al Habtoor said “it was not easy” to find a main contractor for his new project.

“There used to be many contractors but now we choose between big countries like China and India as the only ones capable of doing this project.”

Based by the Dubai Canal in Al Habtoor City, the residential tower will be one of the biggest in the world. It includes three basements for parking and 81 floors.

The main contractor is set to be announced soon.

Person, Worker, ClothingReuters/Faisal Al Nasser
Saudi Arabia accounts for more than half of construction contracts in the Gulf region

The UAE has been one of the region’s top destinations for Chinese firms, with construction volume reaching $29.1 billion since 2005, according to figures from the China Global Investment Tracker.

A combined $110 billion worth of contracts are expected to be awarded in the GCC this year, according to Middle East data provider Meed Projects’ 2023 outlook.

Saudi Arabia will account for more than half of the total.

The Royal Institution of Chartered Surveyors Global Construction Survey for Q1 noted comments from industry professionals working in Dubai that suggest the level of activity in Saudi Arabia is directly impacting projects in the UAE.

The kingdom’s construction sector is being fuelled by multi-billion-dollar giga-projects such as Neom, Diriyah and the Red Sea Project.

Haroon Niazi, partner at consultancy HKA, said: “We’re seeing contractors from the UAE and Qatar, who historically haven’t been active in Saudi Arabia, now entering the market. 

“What this means for the UAE is that if they are at capacity elsewhere, their ability to take on more projects in the country is limited.”