HH Sheikh Mohammed bin Rashid Al Maktoum announced plans to transform the Dubai Creek area, with the aim to raise public awareness of Dubai’s tradition, history and culture. Covering an area of 1.5 sq km, the renovation work will concentrate on four areas – Al Faheidi, Bur Dubai, Deira and Shindagha – with more than 60 projects included in the renovation work.
At an estimated cost of US$ 33 million, there will be new aerospace supply chain facilities developed at Dubai World Central. Due for completion by Q1 2016, the project will include a multi-purpose building, specifically for supply chain tenants in the Maintenance, Repair and Overhaul (MRO) sector.
Damac reported a 64.0% jump in 2014 revenue to US$ 2.0 billion (helped mainly by the delivery of 3.6k units and two land sales, bringing in US$ 874 million) and a 46.1% hike in profit to US$ 937 million. During the year, the company saw a 24.0% increase in booked sales to US$ 3.1 billion, with properties under construction at year end up 20.0% to US$ 2.33 billion.
Arabtec announced that it had won two Emaar contracts, valued at US$ 102 million, to build villas for the Arabian Ranches extension and Al Mira Residences.
Kleindienst, developers of the six-island Heart of Europe project on The World, is launching the sale of villas, some underwater, on Monaco island. The 1.7k sq ft villa prices will start at US$ 1.36 million, with handover slated for 2017.
Now in its 19th season, Global Village expects to attract more than 5 million visitors this year before the 157-day event closes on 11 April. Encompassing 2.7 million sq ft, there are more than 3.5k outlets from 70 participating countries.
Jumeirah manages 22 hotels and has a further 26 in the pipeline, with the latest being the first bearing its new Venu brand. It has signed a management agreement with Meraas Holding to operate a 300-room, 119-apartment property on Bluewaters Island, located off JBR.
Dubai Healthcare City will join up with Northern Ireland’s Queen’s University to establish the Mohammed bin Rashid University of Medicine and Health Sciences. It is expected that the first intake of students will be in September 2016.
Mashreq, Dubai’s third largest bank, is planning to move its HQ from Deira to Downtown, as it issues a tender for a 151 mt tower to be located near Burj Khalifa. With a record US$ 654 million 2014 profit reported last week, the family-based bank should have no problem with financing the project. (This week, the bank forecast that it expected retail lending to fall by 25%, in the wake of a fall in consumer confidence and the introduction of the Etihad credit bureau).
DP World reported an 8.9% increase in gross container volumes in 2014, handling 60 million TEUs. During the year, two new operations opened – Embraport in Brazil and London Gateway – whilst Jebel Ali will have an extra 11.2% capacity later this year when its total capacity will expand to 19 million TEUs.
David Haigh, who has been incarcerated for the past nine months, has launched a US$ 50 million claim against GFH Capital, former owners of Leeds United FC. The ex-MD of the club has been accused by his former Dubai-based employer of embezzling at least US$ 6 million, by faking invoices.
The local courier company, Aramex, posted its 2014 results which showed a 14.5% hike in its net profit to US$ 87 million, of which US$ 24 million was attributable to Q4, a 17.0% increase.
Despite a 10.5% jump in 2014 revenue to US$ 2.1 billion, Dubai Duty Free was edged out of the global number one slot by South Korea who recorded US$ 100k more sales.
Next week sees 4.8k exhibitors and 80k food professionals in Dubai for Gulfood exhibition – a huge boost for the MICE (meetings, incentives, conferences and exhibitions) sector. Now in its 20th year, the five-day event is now the largest of its kind in the world and will expand even more with 600 companies already on next year’s waiting list.
Kia Motors recorded a 10.0% rise in sales to the MENA region to 323.8k vehicles, of which UAE contributed 16.5k – a rise of 11% on the year.
In what appears to be a logical move, Continental, the German tyre manufacturer has shifted its MENA office from Hanover to Dubai. This is another indicator on how the commercial world is increasingly considering Dubai as a regional hub.
It is reported that Dubai-based Buroj Property Development has signed a MoU with the Sarajevo mayor to build a luxury US$ 2.6 billion development in the Bosnian ski resort.
Dubai Investments made two announcements this week – its 2014 results and a major acquisition. Last year the Dubai-listed investment company, with a paid up capital of US$ 954 million, recorded increases in both its Revenue and Net Profit – 12.3% higher at US$ 869 million and 63.0% up at US$ 365 million respectively. The company also showed a 14.3% hike in Total Assets to US$ 3.93 billion. It also announced that it would acquire 60% in Abu Dhabi’s Al Mai Capital for an undisclosed amount.
The DFM reported a massive 167% jump in 2014 profits to US$ 207 million as revenue rose 109% to US$ 255 million. Total trading value for the year surged 139% to US$ 104.0 billion.
The DFMI started the week trading on Sunday at 3674 and recovered all of the previous week’s losses by surging 5.8% to close at 3887 on Thursday (3.0% higher than its January opening of 3774). Bellwether stocks, Emaar Properties and Arabtec, were trading at US$ 1.99 and US$ 0.84 – up 8.7% and 6.3%, in turn, on the week.
In a bid to boost growth, Australia became the latest country to cut rates to a historic low of 2.25%. The 25 basis points reduction resulted in a fall in the dollar to 0.766 to the US$ and a 1.1% jump in the stock market. This seems a deliberate move by the Reserve Bank to ensure that the overvalued currency continues in a southward direction, especially because commodity prices have fallen off sharply. Political turmoil may well see the demise of Tony Abbott as Prime Minister next week but this attempt will probably fail.
Barack Obama is hoping to raise an additional US$ 238 billion as he plans to close a tax loophole by which many US firms avoid paying tax on overseas profits, The money raised, by imposing an initial 14% levy in 2016 and thereafter a 19% annual tax, will be used for road projects. The top five companies with most money stashed overseas are GE (with an estimated US$ 110 billion), Microsoft, Apple, Merck and Pfizer, Whether Congress agrees remains to be seen.
Amazingly still behind the UK’s 3.2%, the US recorded annual 2.4% growth in 2014 but there were warning signs with December returns showing a growing trade deficit and lower business spending. Although there was a December dip in consumer spending (which accounts for 67% of the country’s economic activity), one of the positive indicators was the 4.3% annual jump, attributable to fact that pump prices have fallen 43% over the past six months.
As oil prices have plummeted, the knock on effect is that it has speeded up the rate of deflation in the eurozone with January levels down 0.6% compared to the previous year, as energy prices dropped 8.9%. The main problem is the repayment of debt; falling incomes result in borrowers having difficulty settling liabilities whilst governments see a shortfall in tax revenue.
It is estimated that the 60% drop in oil prices may have contributed an additional US$ 175 billion for consumer spending in the US; as this sector accounts for 67% of the country’s economy, this will fuel confidence and help speed up growth which in Q4 was at an annualised 2.6% – weaker than market expectations.
One casualty of the drastic fall in oil prices was Royal Shell, as the Dutch oil company announced that it was slashing spending by US$ 15 billion over the next three years. Last year, the company reported a 14.0% jump in profits to US$ 6.2 billion.
Despite Chancellor Merkel’s assertion ruling out any further debt relief for the beleaguered Greek economy, Prime Minister Alexis Tsipras is still following his anti-austerity stance and to drastically amend the terms of the current rescue package. In 2012, the country saw US$ 113 billion written off as creditors and banks took a reluctant “haircut” but even now the total outstanding is US$ 356 billion, equivalent to 175% of GDP. The economy has seen a 25% contraction since the start of the crisis and has frightening unemployment levels – 25% of adults and 50% of youths are out of work. There is no doubt that if the impasse is not breached then “Grexit” is one step nearer moreso because both the main protagonists’ mantra seems to be I Won’t Back Down!