Massive boost for Dubai jobs, tourism and real estate
The?economy of Dubai could have a massive boost?over the next seven years and beyond thanks to the decision to award the city the right to host?World Expo 2020.
Long-term job creation, as well as increased tourism, could benefit the real estate and hospitality sectors now and in the long term, according to a report by the real estate company, Jones Lang LaSalle.
However, care needs to be taken, particularly in the short term, to ensure that boosted sentiment doesn?t lead to an unsustainable situation forming in the real estate sector in particular, said Alan Robertson, regional chief executive of the company.
?While the Expo will result in long-term benefits to the Dubai economy and the real-estate market, the short-term impact needs to be managed carefully to avoid the inevitable boost in sentiment translating into excessive price growth or over development,? he said.
Expo 2020 is expected to add 2 per cent to Dubai?s Gross Domestic Product, as well as?create 277,000 jobs.
That increased demand would ordinarily mean price and rent increases over the next seven years, said Craig Plumb, head of research at the company.
However, there is the danger that owners could misconstrue that long-term arc, and immediately push up prices.
?Owners may expect rents to increase overnight that wouldn?t necessarily be justified just on the back of Expo 2020. There?s no logic why rents should increase in the Marina or Downtown tomorrow, just because of the Expo in seven years? time.
?If that happens, it could be a negative situation as it would prolong all this talk about the?property market?being a bubble.?
The company?s report said the hospitality sector in particular would be the ?major winner? in terms of demand for real estate.
?This sector has been driving the recovery of the Dubai market over the past two years, with Dubai currently registering one of the strongest levels of any market globally,? the report said.
Click here to read more.