Al Hilal Bank buys plot on Sowwah Island

Al Hilal Bank will have an office tower built on Sowwah Island, at the centre of what will be the city's new financial district. The bank, based in Abu Dhabi, said yesterday it had bought a 4,850 square metre commercial plot from Mubadala Development, the strategic investment arm of the Abu Dhabi Government, which is developing the island. "Al Hilal joins major organisations such as National Bank of Abu Dhabi (NBAD) and the Abu Dhabi Securities Exchange who will also be located on the island," said Waleed al Muhairi, the chief operating officer of Mubadala. Al Hilal, which is also owned by the Abu Dhabi Government, will commission an office building of about 24 storeys next to Sowwah Square and the Cleveland Clinic Abu Dhabi. Construction is expected to start within the next 12 months with the handover scheduled for 2014. "Sowwah Island will play a vital role in the long-term commercial development of Abu Dhabi and we are excited to be a part of its transformation into the core of the new central business district," said Mohammed Berro, the chief executive of Al Hilal Bank. Al Hilal's purchase follows a series of announcements about the first phase of Sowwah Island's development, including the recent sale of a 6,697 square metre commercial plot to the NBAD and management agreements with Rosewood Hotels and Resorts and Viceroy Hotels, Resorts and Residences for two five-star hotels near Sowwah Square. Sowwah Island, which is being master-planned and developed by Mubadala Real Estate and Hospitality, was also classified as an investment zone by Abu Dhabi's Executive Council in April. The island will be connected to the mainland and other islands with 13 bridges and a mass-transit system with light and heavy rail. Sowwah Square, Mubadala's Dh5.7 billion (US$1.55bn) flagship commercial property development, will be home to the Abu Dhabi Securities Exchange. On the island, Mubadala also owns another 918,221 sq metres of land that could be used for development. About 66,700 sq metres of it has already been divided into 10 parcels for sale, of which one was sold to the NBAD. "Sowwah Island has the potential to be the banking heart of Abu Dhabi," said Nicholas Maclean, the managing director of the property broker CB Richard Ellis. "There is quite a lot of interest from the Abu Dhabi community to occupy accommodation there once the buildings are completed." Mr Maclean said most foreign banks with branches in Abu Dhabi were likely to go to the island on a lease, rather than buying. "But for the Abu Dhabi banks it makes sense for them to buy," he said. "Because of the high-profile nature of what Mubadala wants to achieve there to make it the centre of where banking will exist in Abu Dhabi, I think it makes sense to be looking at occupying space there." The capital has a scarcity of office space, with businesses often forced to move into residential units or villas. According to Colliers International, urban Abu Dhabi consists of 1.4 million square metres of office space. That should increase by 67 per cent over the next three years, with developments on Sowwah, Reem and Saadiyat islands, and Al Raha Beach. [e-mail]