Nakheel plans to award AED12bn ($3.3bn) of construction contracts this year more than the total the Dubai-based developer had originally planned as it accelerates the development of projects.
We are in a phase where we are developing. There will be awards on many contracts this year, more than we projected, we may award AED12bn, said Nakheel chairman Ali Rashid Lootah on 13 April.
At the end of last year Nakheel expected to award about AED10bn of construction contracts in 2017. The value of construction awards is increasing as Nakheel accelerates projects that were planned for construction work to start in 2018. It is not because of costs [increasing]. Some projects as accelerating such as the towers at Ibn Battuta, said Lootah.
The AED12bn total will be almost double the value of contracts that Nakheel awarded in 2016. Nakheel says that it awarded about AED6bn of contract awards that year.
Nakheels largest award this year was the AED4.2bn contract secured by the local United Engineering Construction (UNEC) for the construction of Deira Mall on the Deira Islands development.
Construction on the scheme is expected to start by the third quarter of this year, with completion set for 2020, according to a statement from the developer.
The three-level mall will have four million square feet of leasable space, with over 1,000 shops, cafes, restaurants and entertainment outlets.
Deira Mall will be the centrepiece of Nakheels AED5bn Deira Boulevard development that includes 16 residential towers, almost 2,900 apartments and extensive retail, restaurant and recreation space. Together, the mall and boulevard will have around 4.5 million square feet of shop space. Nakheel issued tender documents for the construction of the boulevard in January.
Another major award planned by Nakheel this year is for the Palm Gateway development. It plans to award the estimated AED1.4bn ($381m) contract before the end of May.
We got bids back, said Lootah. We will award it within one month.
The project involves the construction of three towers and a beach complex, and is expected to take about three years to complete. It will be built on top of an existing car park that serves the Palm monorail on Al-Sufouh road at the entrance to the Palm Jumeirah.
The construction contract was retendered late last year. In early 2016, Nakheel had selected a joint venture of South Koreas Ssangyong Engineering Corporation and China State Construction Engineering Corporation for the construction contract.
Steady performance by Dubais projects market in 2017
Dubai MGM Bellagio
Source: Dubai Media Office
Contractors are winning enough work to replace projects that are being completed
Dubais projects market made a steady start to the year with $7.2bn of contract awards according to data from regional projects tracker MEED Projects.
On a year-on-year basis, the total for the first quarter is down by about 5 per cent on the $7.6bn of awards made in the first quarter of 2016. On a quarterly basis the first quarter total is up by more than 25 per cent on the $5.7bn of awards made during the fourth quarter of last year. Read more