Going Green: A Good Idea Because People Do Buy in Dubai
- Sep 19, 2007
Yesterday’s MHN news included an item about Dubai, which is mulling over a green building policy that could significantly increase its amount of sustainable buildings (the area currently has three.)
What you have heard about Dubai may vary — but you’ve likely heard that it’s in the Middle East (true — it’s in the United Arab Emirates), has many wealthy residents (also true) and is somewhere Michael Jackson has been known to live (oddly enough, once again, true.)
Oil was discovered in 1966, and following the first exports three years later, Dubai began to economically expand — fast.
That growth is still ongoing. Dubai is a key trade center for the Gulf region. And, according to Arabic News, its growth rate reached a new high of almost 17 percent in 2005.
- According to Dubai’s Ministry of Planning, in 2001, Dubai’s population was approximately 1,029,000. Last year, the population increased to 1.422 million from 1.130 million in 2005, according to the National Media Council.
That’s 292,000 more residents — 24,333 a month.
- It’s no surprise that with all those new residents, real estate has been booming for the past few years. Some estimates place the total value of Dubai real estate projects over the next decade at $230 billion.
A booming economy and rapidly growing real estate market — sound familiar? But don’t look at the properties on your street that have sported "for sale" signs for the past six months and start saying "Dubai, I told you so" just yet. It doesn’t look like Dubai’s market is anywhere near a decline.
In fact, as population increases, the need for housing has been so strong for the past two decades, it has led to an unusual property market.
Although some industry analysts expect that situation to change, many feel value and sales will remain strong — including Simon Azzam, chief executive of Union Properties (UP), which was launched more than 20 years ago.
"Dubai’s housing market is still at its infancy and it is very early to predict ‘a bubble burst,’" Azzam told Gulf News. "The phenomenon of overpricing and overpromising will vanish soon. It will become difficult for a developer to sell his property at a price higher than its actual value. Certain areas in Dubai – based on location, culture and services — will be appreciated better in the market and properties in such areas will get extra points by customers."
Right now, he says, the housing demand is so great, location is the only determining factor in sales.
"What is happening now is more of a mismatch," says Azzam. "All
apartments on offer are going out at the same price regardless of
specifications other than their area. This is wrong, and it is not
going to last."
It’s good news for sustainability fans that Azzam feels construction — and UP’s involvement in construction — will remain high, considering his company is committed to building green.
Yet not every builder — foreign or domestic — is. Which brings us back to Dubai’s Executive Council. If Dubai’s Executive Council does decide to take on a green building policy, it could — given Dubai’s huge expected growth — have an enormous impact on the area’s environment.
And the area desperately needs it.
The Emirates may not be big, but the average Emirates citizen puts more demand on the global
ecosystem than any other in the world — in the world — according to the World Wildlife
According to the WWF, using a scale that measures the amount of land needed to generate resources for one person, the UAE’s
ecological footprint measured 11.9 global hectares per person.
To compare, the U.S. has a measurement of 9.6 hectares per person and a global average
of 2.2 hectares a person.
(By the way, I stumbled across this factoid in an article about Dubai receiving an ice lounge — which is totally frozen, and located in a mall. Yeah, there’s some money going on in that city.)
Not only can an emerging market like Dubai, leading by example, influence other similar markets to go green, a decision to adopt a green building policy — given the area’s high construction rates and upcoming housing need, as well as its global ecosystem impact — seems like a must. Making the decision now to build sustainable structures can set Dubai on track for a financially and environmentally sound future. And given the amount of rapid growth in the area, that future seems to be coming faster than Dubai may have anticipated.
The council seemed receptive to the suggestion; we’ll see if it passes. But Dubai isn’t the only rapidly booming area to consider a green policy. More news on those growth hotspots to come later this week.