The new tower being built at Dubai Creek Harbour by Emaar Properties will be 100 metres taller than Burj Khalifa, according to Mohamed Alabbar, the Emaar Properties chairman.
Mr Alabbar has said that work will start on the project to build the tower next month, according to CNN. Designed by the Spanish-Swiss architect Santiago Calatrava, the new cable-tied tower is planned as the centrepiece to a major new district based on the banks of Dubai’s creek close to the wildlife sanctuary at Ras Al Khor.
Emaar Properties said in April, when revealing plans for the tower, that the area that will be twice as big as Downtown Dubai, with a footprint of 1,200 hectares, compared with the 500 hectares of Downtown Dubai. It will have 2 kilometres of creekside waterfront and will house 679 million square metres of residential space, 851,000 sq metres of commercial property, 22 hotels with 4,400 rooms and 11.16 million sq metres of retail. By comparison, The Dubai Mall has an overall footprint of 1.1 million sq metres.
During his interview with CNN, Mr Alabbar said that a mall within the new district would be substantially larger than The Dubai Mall.
“Our [Dubai Mall] corridors, even though when we designed it are 30 per cent bigger than traditional shopping mall corridors, we still got it wrong. I think we need to do more. We need to get it a little bit bigger,” he said.
“But I think size is not the issue. With the digital world, e-commerce … you really don’t go shopping any more. You’re going for the environment, to entertain, to eat, to communicate and to shop, by the way. But technology is going to drive it all for us.”
A tower that is 100 metres taller than Burj Khalifa would be 928 metres, which is taller than anything currently standing in the world, but not as tall as the 1km-plus Jeddah Tower being built in Saudi Arabia.
That is due to be delivered in 2019, while the target for Emaar Properties’ Dubai Creek tower is for it to be ready by the time Dubai’s Expo 2020 begins the following year.
The tower will house a boutique hotel, vertical gardens, a 360-degree observation platform, restaurants and function hall spaces.
At the tower’s launch, Mr Calatrava said that its construction was likely to be separated into three packages, with one contractor responsible for the piling work, another for the tower’s main concrete base and a third for steelwork, including fabrication of cables, which will be the longest ever used on a structure.
“Certainly we want to start on the foundations very soon,” said Mr Calatrava.
“For the moment, we are concentrated on the packages we need to send out as soon as possible.”
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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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