Aldar Properties, Abu Dhabi’s largest listed developer, awarded 49 contracts worth Dh22 billion ($6 billion) last year, as it expanded its portfolio amid continued growth in the emirate's real estate market.
Aldar awarded the contracts to 36 UAE-based companies for its infrastructure, residential, commercial, and mixed-use developments across the capital, it said in a statement on Wednesday to the Abu Dhabi Securities Exchange, where its shares are traded.
Almost 50 per cent of the total value – Dh10.5 billion – is being recirculated to Abu Dhabi's economy, in line with the National In-Country Value (ICV) programme, Aldar said.
“Once completed, these projects will not only help to satisfy demand for new residential options in the capital, but also deliver new office and retail spaces, and make the emirate more connected through a series of infrastructure improvements,” Adel Abdulla Albreiki, chief executive of Aldar Projects, said.
Aldar places sustainability as a key credential within its procurement process, ensuring that all contractors are positively contributing to our net zero commitments
Adel Albreiki,
chief executive of Aldar Projects
About 53 per cent of the contracts awarded were for Aldar's own projects, while the remainder are for the developments the company is delivering on behalf of the Abu Dhabi government.
When completed, these projects will add to inventories of villas, townhouses, apartments, Grade-A offices, retail spaces, schools, and major highways within some of Abu Dhabi’s key growth locations, including Yas Island, Saadiyat Island and Al Shamkha, Aldar said.
All Aldar contracts are also aligned with the UAE climate goals and adhere to net zero commitments.
“Aldar places sustainability as a key credential within its procurement process, ensuring that all contractors are positively contributing to our net zero commitments, which encompass a number of critical levers, including low carbon design, low carbon supply chain, green construction and circular economy,” Mr Albreiki said.
The ICV programme, part of the UAE's Projects of the 50, aims to boost the growth of UAE-based industries by redirecting half of government spending on procurements and tender contracts into the national economy by 2031.
It has expanded significantly since the launch and offers growth opportunities for companies in priority sectors, such as heavy industries, space technology, hydrogen and medical technology.
The property market in the UAE bounced back strongly from the pandemic-driven slowdown in 2021 and it has maintained a robust growth momentum.
Aldar, the developer behind Abu Dhabi's Formula One circuit and other developments in the emirate, awarded Trojan General Contracting in partnership with Arabian Construction Company (ACC), a contract on Saadiyat Island to develop the first two phases of Saadiyat Lagoons. The third phase was awarded to Innovo Build.
In total, more than 2,000 residential units will be developed by the contractors at Saadiyat Lagoons.
On Yas Island, Fibrex was selected to develop homes at Yas Park Gate and Yas Park Views. The project includes the development of 849 units. ACC was awarded a contract to develop a Grade A office tower, responding to the demand for commercial space on Yas Island.
Nurol has been awarded the villa and infrastructure works at Fay Al Reeman II, which will add 557 residential units in the Al Shamkha area.
Another contract was awarded to Trojan for villa and infrastructure works at Balghaiylam, a new community for the UAE citizens being developed in partnership with Abu Dhabi Housing Authority. It will feature 1,743 homes.
On Tuesday, Aldar said it would invest Dh5 billion to develop a range of income-generating assets in Abu Dhabi, with a focus on commercial, retail and hospitality sectors amid growing demand for property in the UAE.
Last month, the developer also unveiled a residential development on Yas Island, comprising 234 apartments, duplexes and penthouses.
Aldar has also been expanding its global presence. On Thursday, the company announced a Dh407 million investment in logistics and storage assets in Europe through a partnership with global investment firm Carlyle.
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- Crusaders 17, Highlanders 0
- Lions 23, Sharks 21
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Sand storm
- Particle size: Larger, heavier sand grains
- Visibility: Often dramatic with thick "walls" of sand
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Dust storm
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- Duration: Can linger for days
- Travel distance: Long-range, up to thousands of kilometres
- Source: Can be carried from distant regions
Other workplace saving schemes
- The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
- Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
- National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
- In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
- Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.
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Bogleheads follow simple investing philosophies to build their wealth and live better lives. Just follow these steps.
• Spend less than you earn and save the rest. You can do this by earning more, or being frugal. Better still, do both.
• Invest early, invest often. It takes time to grow your wealth on the stock market. The sooner you begin, the better.
• Choose the right level of risk. Don't gamble by investing in get-rich-quick schemes or high-risk plays. Don't play it too safe, either, by leaving long-term savings in cash.
• Diversify. Do not keep all your eggs in one basket. Spread your money between different companies, sectors, markets and asset classes such as bonds and property.
• Keep charges low. The biggest drag on investment performance is all the charges you pay to advisers and active fund managers.
• Keep it simple. Complexity is your enemy. You can build a balanced, diversified portfolio with just a handful of ETFs.
• Forget timing the market. Nobody knows where share prices will go next, so don't try to second-guess them.
• Stick with it. Do not sell up in a market crash. Use the opportunity to invest more at the lower price.
What drives subscription retailing?
Once the domain of newspaper home deliveries, subscription model retailing has combined with e-commerce to permeate myriad products and services.
The concept has grown tremendously around the world and is forecast to thrive further, according to UnivDatos Market Insights’ report on recent and predicted trends in the sector.
The global subscription e-commerce market was valued at $13.2 billion (Dh48.5bn) in 2018. It is forecast to touch $478.2bn in 2025, and include the entertainment, fitness, food, cosmetics, baby care and fashion sectors.
The report says subscription-based services currently constitute “a small trend within e-commerce”. The US hosts almost 70 per cent of recurring plan firms, including leaders Dollar Shave Club, Hello Fresh and Netflix. Walmart and Sephora are among longer established retailers entering the space.
UnivDatos cites younger and affluent urbanites as prime subscription targets, with women currently the largest share of end-users.
That’s expected to remain unchanged until 2025, when women will represent a $246.6bn market share, owing to increasing numbers of start-ups targeting women.
Personal care and beauty occupy the largest chunk of the worldwide subscription e-commerce market, with changing lifestyles, work schedules, customisation and convenience among the chief future drivers.
Financial considerations before buying a property
Buyers should try to pay as much in cash as possible for a property, limiting the mortgage value to as little as they can afford. This means they not only pay less in interest but their monthly costs are also reduced. Ideally, the monthly mortgage payment should not exceed 20 per cent of the purchaser’s total household income, says Carol Glynn, founder of Conscious Finance Coaching.
“If it’s a rental property, plan for the property to have periods when it does not have a tenant. Ensure you have enough cash set aside to pay the mortgage and other costs during these periods, ideally at least six months,” she says.
Also, shop around for the best mortgage interest rate. Understand the terms and conditions, especially what happens after any introductory periods, Ms Glynn adds.
Using a good mortgage broker is worth the investment to obtain the best rate available for a buyer’s needs and circumstances. A good mortgage broker will help the buyer understand the terms and conditions of the mortgage and make the purchasing process efficient and easier.
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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US households add $601bn of debt in 2019
American households borrowed another $601 billion (Dh2.2bn) in 2019, the largest yearly gain since 2007, just before the global financial crisis, according to February data from the New York Federal Reserve Bank.
Fuelled by rising mortgage debt as homebuyers continued to take advantage of low interest rates, the increase last year brought total household debt to a record high, surpassing the previous peak reached in 2008 just before the market crash, according to the report.
Following the 22nd straight quarter of growth, American household debt swelled to $14.15 trillion by the end of 2019, the New York Fed said in its quarterly report.
In the final three months of the year, new home loans jumped to their highest volume since the fourth quarter of 2005, while credit cards and auto loans also added to the increase.
The bad debt load is taking its toll on some households, and the New York Fed warned that more and more credit card borrowers — particularly young people — were falling behind on their payments.
"Younger borrowers, who are disproportionately likely to have credit cards and student loans as their primary form of debt, struggle more than others with on-time repayment," New York Fed researchers said.
