Emaar buys stake in South African consultancy

11 February 2016

Company has delivered $6.43bn of projects across African, Indian Ocean and Middle Eastern regions

The UAE’s Emaar Properties, the developer of the world’s tallest tower, has bought a stake in a South African project development and management consultancy, an Emaar spokesperson has confirmed.

The consultancy has delivered an estimated $6.43bn-worth of schemes across the African, Indian Ocean and Middle Eastern regions.

“Emaar has acquired a stake in Mirage Leisure & Development, a company with proven expertise in providing turnkey support for complex projects and having strong relationships with design consultancie, vendors and procurement managers,’’ the spokesperson said without giving details about the size or the value of Emaar’s stake in the firm.

Mirage Leisure & Development has worked on many major schemes in the UAE, including the $2bn Bluewater and Dubai-I project for owner Meraas Holding; the $850m Deira Dubai Creek Waterfront project for the developer of the man-made Palm Islands Nakheel Properties; the Madinat Jumeirah project for Jumeirah Group; Emaar’s $350m The Address Downtown, Armani, and Al-Manazil hotels; and the $830m St Regis Resort on Saadiyat Island, owned by Abu Dhabi’s Tourism Development Investment Company (TDIC).

In total, the consultancy is associated with 21 projects in the Middle East, according to its website.

It operates out of offices in South Africa, Mauritius and the UAE, and has worked on 14 schemes in the African region, including the $130m One & Only Cape Town, the refurbishment of Sun City Hotel and the development of Silverstar Casino. The $100m St Regis Mauritius Resort, $80m Long Beach Resort and $120m St Kitts Development are some of the other projects Mirage Leisure & Development has delivered.

“This is a good fit to Emaar’s strategy of developing premium assets in the property, malls and hospitality sectors, the firm’s spokesperson said. “Emaar is developing significantly complex projects, and the acquisition will assist in the timely delivery of quality developments and in optimising project management costs.”

 Opera House Construction

Mirage is working with Emaar on its Opera House development in Dubai

Source: MEED

Emaar has been working with Mirage on several projects, including the $300m The Opera District in Downtown Dubai, the spokesperson added.

Mirage is also managing a project at Emaar’s multibillion-dollar Dubai Creek Harbour development, which includes building 500,000 square metres of retail and 500,000 sq m of mixed-use space, according to a source familiar with the matter.

On 10 February, Emaar, the biggest publicly-traded developer in the region, reported flat profit for the fourth quarter of 2015, as it wrote-down losses related to the New Year’s Eve fire at the Address Downtown hotel. The AED301m ($82m), write-off affected its quarterly bottom line, halting an earnings boom for the developer, which had reported growth in net income in the preceding 10 quarters.

The developer, which is majority-owned by the Dubai government, said it had to recognise the write-off in the year the loss occurred, according to accounting rules, and it can record the payouts from insurance claims as income when they are paid.

The developer reported a net profit of AED1.034bn for the three months ending 31 December 2015, slightly down from AED1.045bn for the same period in 2014, it said in a statement to the Dubai Financial Market. Its full-year 2015 net operating profit was AED4.383bn, an 18 per cent year-on-year growth.

Emaar, which has a total land bank of about 195 million sq m in Dubai and in international markets, said demand for residential property in the emirate remained strong, with total sales reaching AED10.23bn. The firm did not give comparative figures for total sales in 2014.

The property market in the UAE is softening amid the economic slowdown and waning investor and consumer confidence. The volumes of sale and property values have slumped in 2015 and analysts predict further declines in 2016.

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