Ready to get their feet wet again



Marina projects totalling tens of thousands of berths were planned for Dubai before the onset of the global financial crisis.

But sharp falls in property prices and the negative economic environment meant these never materialised.

Now many large projects are going ahead around the region, as a boating element can drive up the value of waterfront developments, with marinas sitting alongside art galleries, cinemas, shopping malls and apartments.

"I don't think it's like before 2008," says Michael Horrigan, the chief executive of Mourjan Marinas IGY, based in Dubai.

"Before 2008 there were dozens upon dozens of marina developments that were being touted. It's not as widespread or as prolific as it was, but there's still some very good developments."

Mourjan plans to open 400 berths at The Wave development in Oman this year. In Qatar, the company is developing its Lusail project, which will eventually have about 1,500 berths.

These luxury marinas, which cost between US$5 million (Dh18.3m) and $25m to build, are planned to include valet parking, cooling mist sprays and spaces for business meetings. Mourjan, which manages Festival Marina in Dubai, also has projects in Russia and Bahrain.

In Abu Dhabi, it has completed the design for a marina at Mina Zayed, although construction is yet to start.

Marina development in the region is now being more carefully evaluated, according to the company.

"The difference in the developments is that there's a lot more emphasis and priority on feasibility studies, on market evaluation, construction costs," says Mr Horrigan.

"People like having an apartment near their boat. They like the retail mall, restaurants. That is still there.

"Even in Dubai, I honestly believe we will see a return to that energy level that existed in 2008 because it wasn't a failure in that model; it was a series of financing complexities."

Mourjan is owned by GSSG, a Qatari company.

The developer Nakheel tied up with IGY, an affiliate of Mourjan, a few years ago with plans to build 40,000 berths in Dubai.

The agreement was dissolved in 2009 but one of these projects, Anchor Marina, on Palm Jumeirah, was built and is expected to finally open this year.

Analysts agree there is potential for regional marina development, but say challenges remain.

"The first thing is they need to build a marina culture," says Alessandro Borgogna, of Booz & Company. "In the region there are very few schools that train captains and crew members." Mr Borgogna adds that the red tape around port entry processes is also an issue.

Booz & Company estimates developers will have to make capital investments of between $200bn and $300bn over the next 15 years to meet expected growth in demand for berths in the Mena region.

With the right facilities, more Middle East boat owners would keep their vessels here.

"There is a high incidence of Middle East boat owners who keep their larger boats in other markets, either the Mediterranean or Caribbean," says Mr Horrigan.

"That's partly because if they bring them back to the Middle East at the moment they're going to be in a commercial port, so they're going to be beside an oil tanker or a container ship.

"You have to recognise many of the Middle Eastern dignitaries, the royal families, or just the wealthy have major boats that they would like to have in the Middle East."

Europe’s rearming plan
  • Suspend strict budget rules to allow member countries to step up defence spending
  • Create new "instrument" providing €150 billion of loans to member countries for defence investment
  • Use the existing EU budget to direct more funds towards defence-related investment
  • Engage the bloc's European Investment Bank to drop limits on lending to defence firms
  • Create a savings and investments union to help companies access capital
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Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
 
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
 
Round 3: February 7-9, Dubai Autodrome – Dubai
 
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
 
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia
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COMPANY PROFILE

Company name: Letstango.com

Started: June 2013

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