The 38-year-old World Trade Centre, where the DFM has been since it was founded in 2000. Stephen Lock / The National
The 38-year-old World Trade Centre, where the DFM has been since it was founded in 2000. Stephen Lock / The National
The 38-year-old World Trade Centre, where the DFM has been since it was founded in 2000. Stephen Lock / The National
The 38-year-old World Trade Centre, where the DFM has been since it was founded in 2000. Stephen Lock / The National

Markets

Dubai Financial Market to leave the only home it has ever known

The Dubai Financial Market is to seek tenders for the multimillion dollar building on land that has been given to it by the government-owned developer Dubai Properties.

Frank Kane

April 16, 2016

  • English
  • Arabic

The Dubai Financial Market, the emirate’s main stock exchange, is to construct a new high-tech headquarters in Business Bay, ending its 16-year presence in the historic World Trade Centre.

DFM is to seek tenders for the multimillion dollar building on land that has been given to it by the government-owned developer Dubai Properties, valued at Dh231 million, in a move that marks a significant southward shift in the financial centre of gravity in Dubai.

Essa Kazim, DFM's chairman, told The National: "It is a very good site, looking over Sheikh Zayed Road by the entry to Business Bay. It's very close to the Dubai International Financial Centre and at the heart of the new Dubai. It will be a custom-made building that can accommodate our own and the brokers' requirements, and will have a significant data-recovery capability."

Designers and architects will be asked to submit plans for the new project, which should be completed in three to four years, he said. DFM has been considering a move to a new HQ for some time, weighing the attractions of Business Bay or a site within DIFC precincts. The quality of the Business Bay site, and issues of regulation, swung the decisions in its favour.

DFM is regulated by the federal Securities and Commodities Authority, while DIFC entities fall under the Dubai Financial Services Authority.

The market will move out of the 38-year-old World Trade Centre, where it has been since it was founded in 2000, with its characteristic oak-panelled trading floor. Mr Kazim said he was considering whether to include a physical trading floor in the new design. “Even in these days of sophisticated financial technology, a trading floor is good for marketing and ceremonial purposes. But we will see what the brokers want. Their business requirements are very important.”

It is too early to say what will happen to the trade centre’s current premises. The tower, which houses big corporate and financial tenants as well as DFM, is the centrepiece of the expanding Dubai International Convention Centre.

A statement on the DFM website confirmed the upcoming move, according to the requirements for disclosing material information.

“Kindly note that the DFM has received free of cost a land plot from Dubai Properties subsidiary of Dubai Holding in the Business Bay in Dubai, noted that the land plot measuring 10,232.9 square meters with market value Dh231m to construct its main building that will house the market’s future headquarters, in line with the market development vision.”

fkane@thenational.ae

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Company name/date started: Abwaab Technologies / September 2019

Founders: Hamdi Tabbaa, co-founder and CEO. Hussein Alsarabi, co-founder and CTO

Based: Amman, Jordan

Sector: Education Technology

Size (employees/revenue): Total team size: 65. Full-time employees: 25. Revenue undisclosed

Stage: early-stage startup 

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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