Abu Dhabi’s real estate sector jumped by nearly five times during 2004-2009 to surpass Dh46 billion and become one of the largest components of the emirate’s GDP, government figures showed on Saturday.
From around Dh9.5 billion in 2004, the value added of the sector, or its contribution to GDP, leaped to a record high level of Dh46.03 billion in 2009, the Abu Dhabi Department of Economic Development (ADDED) said in it a report.
The report showed gross fixed capital formation (local investment) in the sector also more than doubled to Dh4.8 billion in 2009 from Dhtwo billion in 2004.
Foreign direct investment in Abu Dhabi’s real estate sector, one of the largest and most lucrative in the region, stood at around Dh11.8 billion in 2007, when the sector was at its height during the oil boom.
The figure accounted for nearly 35.6 per cent of the total FDI flow into Abu Dhabi during that year, ADDED said in its annual report.
“Real estate and business services constitute one of the promising economic sectors in the emirate's economy, and it contributes significantly to the diversification of the economic base,” it said.
“The contribution of the real estate and business services to Abu Dhabi’s GDP soared to 8.4 per cent in 2009 from around 4.4 per cent in 2004.”
The report showed the real estate sector recorded a staggering annual growth of 36.9 per cent during 2004-2009 but growth was negative in 2009 compared with the previous year because of the global fiscal crisis.
“Following the global crisis which hit all markets and affected many sectors of the economy, particularly the real estate sector, the annual growth rate of real estate and business services fell to 6.5 per cent in 2009 from 7.8 per cent in 2008.”