The UAE construction market will remain strong as the total value of the projects is expected to be more than Dh1.1 trillion this year, according to a new report.
EC Harris’ 2014 International Focus on the UAE report said the value of announced and planned projects in the UAE in 2014 is expected to be $315 billion (Dh1.15 trillion), and as of May 2014, $212 billion (Dh778 billion) worth of construction projects are currently under construction.
It said the UAE’s construction market is predicted to return to near full capacity with a number of megaprojects in the pipeline and the ramping up of social infrastructure spend.
Christopher Seymour, Partner and Head of Property and Social Infrastructure at EC Harris, said: "The UAE has experienced a shifting momentum of activity over the past decade with 2009 onwards being difficult years for the market. The dynamic has changed from a period of negative to low inflation over the last few years to a period of moderate increase.
“The market is finally showing real signs of recovery and prospective growth suggesting that the construction market will remain strong this year.”
According to EC Harris' Construction Cost Index, construction prices in the UAE are set to rise by 4 to 5 percent over the duration of the year and approximately 6 percent in 2015.
Furthermore, the report highlights that the Dubai's real estate market is stronger and more sustainable whilst Abu Dhabi's market is steady; however, the report states the capital may increase construction spend in the latter half of 2014 and early 2015.
Seymour said: “We are seeing tenders in the market covering the full range of projects including large scale programmes and also smaller schemes right down to the small fit out work. To this extent, the market is showing a healthy profile with opportunities for SME and large international contractors and joint ventures. Similarly, the supply chain at all levels is seeing strong growth across the range of schemes.”