Megadevelopments in the Middle East are expected to continue despite the pandemic but must be properly thought-out if they are to have an enduring legacy, according to Strategy&.
Larger construction and property projects, usually spread over hundreds of thousands of square metres, can help countries provide a better quality of life by regenerating previously unused areas and promoting the development of specific sectors such as tourism, financial services or manufacturing, according to a report by the consultancy.
"Megaprojects such as those we've seen in Dubai, or even Canary Wharf in London, can have a lasting impact when they succeed," Karim Abdallah, partner and real estate leader at the company, said.
Dubai, home to the world's tallest skyscraper Burj Khalifa and the Middle East's commercial and tourism hub, set forward a plan on Saturday to overhaul its urban landscape and increase its community and recreational areas with an aim to become the best city to live in by 2040. Under the emirate's latest urban plan, areas for economic and recreational activities will grow by one and a half times, and the length of beaches will increase by 400 per cent over the next two decades, Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, said.
A forward-looking approach to urban planning has helped the UAE to accommodate long-term population growth. The UAE's population stood at 9.5 million at the end of 2019, up from under 3 million in 2001, according to the Federal Competitiveness and Statistics Centre. Average annual population growth between 2010-19 stood at 1.6 per cent, the FCSA said.
The emirate has previously been successful in developing projects such as the Dubai International Financial Centre and Downtown Dubai, which "transformed an empty plot of land into a global tourism destination and one of the city’s most desirable residential areas", Strategy& said.
Downtown Dubai also proved to be a resilient project, considering its first phase was completed during the 2009 market downturn, it said.
Still, such projects need to begin with a clear concept to be successful in the long term. A megaproject needs to address key topics such as who its target users are and the elements needed to attract them.
"With these developments requiring large amounts of capital and generally more than a decade to execute, it is imperative that they begin with a concept that sets the project up for future success and adapt in the face of unexpected events, such as the ongoing Covid-19 pandemic,” Mr Abdallah said.
The consultancy also recommended that megaproject developers remain flexible enough to adapt to market changes and shifting consumer preferences. They should also include recurring revenue streams to cover a project's operating expenses should funds dry up in the future.
Dubai is currently home to seven of the Middle East's 10 biggest buildings, according to the Council on Tall Buildings and Urban Habitat.
The emirate also completed more high rises in 2020 than any other city in the world. Some 12 buildings taller than 200 metres were completed in 2020, three more than in 2019.
The tallest building completed in Dubai last year was the 336-metre-high SLS Tower in Business Bay.