Other emirates get in on the act

Abu Dhabi and Dubai are not the only places in the UAE with ambitious construction projects on the go. Angela Giuffrida looks at ongoing and upcoming projects in Ras Al Khaimah, Umm Al Quwain and Fujairah.

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By  Angela Giuffrida Published  December 23, 2006

Dubai and Abu Dhabi may grab the headlines when it comes to playing host to extravagant and groundbreaking real estate developments, but the smaller emirates are gradually nurturing their own assets as a way of attracting a steady flow of long-term investment in their economies. Take the northernmost emirate of Ras Al Khaimah, for example. The once humble fishing village has gone one up on its neighbours with the announcement earlier this year of a planned US $265 million spaceport. The drive is also on to attract more tourism and permanent residents with the construction of the emirate’s first man-made island development — Rakan Al Majan Islands. The cluster of five islands, which is costing $1.8 billion to develop, will accommodate 50,000 residents by the time it’s finished in 2010. The developer behind the project, Rakeen, was set up earlier this year as part of the government’s overall economic plan. The company is also building RAK Offshore, which is destined to become the new hub for offshore financial operations, The Gateway, Al Hamra Amenity Centre, Jabal Al Jais and Banyan Tree Resort. Another massive tourism development under construction is RAK Properties’ $2.7 million Mina Al Arab project, which will be set on a three-kilometre long natural beach and will play host to residential units, luxurious villas, hotels, shopping centres, restaurants, resorts and spas. The airport is also being expanded to accommodate the envisaged extra guests, while investment is being ploughed into improving the emirate’s infrastructure as well as revamping its port. Manufacturing is another sector in which Ras Al Khaimah has been successfully developing. RAK Ceramic Company is one of the largest producers of ceramic tiles and sanitary ware in the region, with nine factories in the UAE and six across Europe, Asia and Africa. The company produces more than 125,000m² of tiles and around 6,500 pieces of sanitary ware everyday in the UAE, along with over 42,000 m² of tiles and 2,000 pieces of sanitary ware in other global locations. Elsewhere in the UAE, Ajman is growing into prominence with the announcement this week of Ajman 1 (see page 3), which will be made up of 12 residential towers along with other commercial and hospitality components, while Emirates City will boast 72 towers. In Umm Al Quwain, FuGen, a UK-based international project management and investment company, recently launched the $136.2 million Rainbow Towers project. The project will be made up of seven towers and 1,008 apartments, and is targeted at lower income families facing drastic rent hikes in Dubai, Sharjah and Ajman. While most of the emirates are jumping on the real estate bandwagon, Fujairah continues to develop its energy-related construction projects. Around 20 companies, which included a joint venture between the UK’s International Power and Japan’s Marubeni Corporation, along with Essa Power from India and Suez Energy Middle East, recently prequalified to build Fujairah 2, the Abu Dhabi Water and Electricity Authority’s water and power plant which will have the capacity to generate 2000mW of electricity and 591,000m³ of water by the time it goes into operation in 2010. The emirate is also becoming a hub for the oil industry due to its strategic location and low overheads, and is now looking to expand on this in order to diversify and balance its economy. Sharief Habib Al Awadhi, director general, Fujairah Free Zone, said that despite the rising costs involved in energy-related construction projects, the emirate is still receiving interest from major investors. One of these is the Abu Dhabi National Oil Company (ADNOC), which is planning to build a $3 billion refinery capable of generating 500,000 barrels per day of oil. “Because of its strategic location and the fact it is still developing, we get approached by a lot of municipalities,” explained Al Awadhi. “And because a company like ADNOC is a major investor, I don’t think the rising building material costs will have much of an impact — people also mentally prepare for price rises. The companies that it will affect more are smaller investors seeking a new base for their projects.” Fujairah already has the biggest tank storage facilities in the Middle East, with 1.2 million tonnes of capacity, and is world’s third main port for bunkering fuel. “We believe that we can attract more petrochemical companies for refinery projects,” said Habib. “Having more of this type of project would also help improve the services industry, which in turn would allow for other types of industry to come on board, such as sulphur.” Habib added that although building material prices have gone up by 40-50% in the last year, the biggest impact on project budgets is the extra transport costs because of rising fuel prices. “Fuel prices have increased the cost of transporting goods, so that adds to the cost of the project.”

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