By Hadeel Al SayEgg and Luke Tyson
Dubai (Reuters) -In a city known for turning the desert into a silhouette, the developers take the construction process into their own hands as they seek to load a turbo boom on the property and maximize cash flow.
A growing number of large UAE developers create internal contracting companies after relying on third -party contractors for a long time. This move is aimed at increasing control over construction, costs and standards of quality, and ultimately ensuring a larger share of profits, although it can also carry risks.
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In so far, an undeclared sign of the Emaar Properties trend, which has developed Burj Khalifa, has created Rukn Mirage under its subsidiary Mirage, a Reuters spokesman said. Emaar joins developers such as Samana Developers, Ellington and Azizi, all of whom have launched internal contracting units in the last two years.
Arada, the developer, the co -founder of Saudi Prince Khaled bin Alvled bin Talal al -Saud, also confirmed in a statement to Reuters that they have acquired part of an Australian performer this year and plan to integrate it into the UAE operations by 2027.
The change comes when real estate in Dubai is increasing, with prices increasing by 70% in four years to December 2024 and a government plan for the doubling of the population to 7.8 million to 2040.
Property launches increased by 83% in 2024, although the ends fell by 23%, according to industry data.
The boom nourishes a new influx of workers, including migrant workers mainly from South Asia, with high turnover rates among expatriliary staff. It also led to fears of a decline in a sector, which remains crucial to the UAE economy.
The developers are competing to attract offers from external contractors against the backdrop of solid competition.
Initially, Samana developers had planned to allocate 20% of their projects for their new inner hand, launched in September. Now 80-90% of his new projects are being processed internally, CEO Imran Faruk told Reuters.
“We have received 25 or 30 contractors who bid for a project. Today you hardly receive two or three,” Faruk said.
Emaar, meanwhile, is taking a hybrid approach. While some projects-like recently announced housing development will be completed by their internal construction a Mirage, they will continue to assign to others, founder and managing director Mohammed Alabar.
Developers also touch the debt markets to finance land purchases and operations, as billions of dirhams in buyers’ payments remain in Escrow until broadcast. The funds are released only after final inspections, with a one -year grace period of delivery, before buyers can claim a refund.