Why Chinese investors decided to suspend their projects in Dubai
Even countries with stable economies, including the United Arab Emirates, were affected by the global crisis. Here we can observe a slowdown in the development of the real estate market – investors from China are leaving the country. However, according to experts, such difficulties are temporary and everything will soon take its place.
Last year, Chinese citizens’ investments in the UAE market were among the four largest in terms of investment in Dubai. However, the situation has changed in the current situation, when China collapsed the coronavirus COVID-19 outbreak, which then spread across the world. Then, in the segment of real estate Emirates sharply reduced the number of transactions, and many Chinese investors decided to take a break.
Despite a significant capital outflow, local experts say that so far the market situation is not critical and the sales figures are high. Builders and developers have switched to clients from other regions, some of them show active interest in Dubai housing and commercial facilities. The segment attracts African citizens, Russian businessmen also return after a certain absence. Indian and British investors make deals, invest in construction or finished buildings.
Local experts believe that the decline in the share of investments from the Chinese is a temporary phenomenon. Soon all processes in the world will stabilize, Chinese economy will quickly recover from the epidemic and cooperation will pick up again. Especially since the majority of clients in the UAE market are large businessmen from Beijing and Shanghai, and the metropolises are less affected by the crisis than the regions of the country. Therefore, there is no reason to worry. Of course, there is no need to deny the psychological aspect when people are still frightened by the outbreak of the disease and have suspended all their business to get back in order.
As evidenced by the developers of Dubai, most of the projects were acquired at the end of last year, and then Chinese clients invested impressive amounts. These assets are quite enough to support the market during the recovery of all business processes. Moreover, a number of developers have already noted that partners from China are beginning to gradually enter the pace, and are interested in the prices and prospects of certain projects.
The crisis has not only touched China. All countries have been affected to a greater or lesser extent, and a period is needed to restore normal processes. In order not to lose the good pace of development of the real estate market in Dubai and the Emirates in general, developers have reoriented the business model to attract as many local investors as possible. Flexible terms and conditions of cooperation are presented for them, and there are various offers for which convenient investment programs are in place.