An estimated $20bn worth of mega real estate projects are now under way in the northern emirates.

The investment is to be welcomed and is vital if the UAE’s smaller economies are not to fall further behind the powerhouses of Abu Dhabi and Dubai.

But while Sharjah, Ajman, Fujairah, Umm al-Qaiwain and Ras al-Khaimah are coming late to the boom, they can learn from some of the challenges faced by their neighbours, which could undermine a building boom in the northern emirates before it starts.

The catalyst for development in the northern regions was the Emirates road extension, completed in mid-2005 and subsequently slashing journey times between Dubai and Ras al-Khaimah.

Following the completion of the Emirates road, the individual states launched a raft of projects, which will more than double the population of the smaller emirates such as Ras al-Khaimah and Umm al-Qaiwain.

But as development accelerates, many of the benefits attracting investors to the northern emirates will begin to disappear as it starts to experience growing pains, such as inflation and congestion, which are currently affecting Dubai and Abu Dhabi.

Construction costs have risen by more than 40 per cent over the past two years and the cost of living is following a similar trend, according to developers.

Realising that inflation is becoming a problem, Ras al-Khaimah has followed the example of Dubai and imposed a 15 per cent cap on rental increases as it tries to take some heat out of the market.

Congestion is also an issue. Many of the roads are filled with construction traffic delivering building materials to sites.

As more people move north from Sharjah looking for lower rents and cheaper properties, the number of commuters on Emirates road will create longer journey times.