Ad agencies look forward to Dubai Metro concessions

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The region’s largest advertising companies are gearing up to compete for the Metro’s lucrative advertising contracts in what could be the biggest tender of its kind in the Middle East, the Roads and Transport Authority (RTA) said.

 

And despite the secrecy surrounding the nature of the advertising business on offer, an RTA official told Emirates Business the authority is planning to award Metro advertising contracts for a period of up to five years, maybe through one comprehensive contract or through separate contracts for each of the rail lines and stations.

 

“The RTA has received several offers from companies both inside and outside the country to win exclusive rights of Metro advertisements,” said the official.

 

Agencies have even submitted initial offers, but the RTA has opted to wait for the results of a study of the project’s advertising returns before putting it out to tender.

 

“No final figures of expected return are available, but early estimates indicate that it will be in billions throughout the five years of the contract,” he said. Only large advertising companies will be invited, the official added. 

 

Apart from the main contract for advertising inside and outside the Metro cars, separate concessions will be awarded for advertising on the Metro viaduct, pillars and stations.

There could even be an opportunity to benefit from promotion and advertising on the tickets themselves, added the official.

 

“The RTA will offer rights to use Metro stations to selected companies, government and private departments and institutions for design and colour of stations, while maintaining the safety and security conditions set by the RTA,” he added.

 

The official said the RTA intends to “use the latest methods and best practices in the field of outdoor advertising”.

 

The viaduct will have lights and bright advertising signs. The same applies to the concrete pillars that support the viaduct.

 

However, sources within leading UAE advertising agencies have expressed apprehension that competition among the bigger players could push the value of the contract to unviable levels, especially if critical demographics are not made available, such as the expected number of Metro passengers and breakdowns of passenger incomes.

 

Meanwhile, Emirates Business has also learned that the Civil Aviation Authority of Dubai will design and build two stations near the airport.

 

They will carry the authority’s name. Also BurJuman shopping centre has won a concession to design and build the BurJuman station, which will carry its name. Dubai Holding has got a station of its own as well.

 

Among 42 stations (28 of the red line and 14 of the green line), RTA will offer only 23 stations for sponsorship by other companies and bodies, while the remaining stations will maintain their design, which should be “in harmony with the national identity of the UAE”. 

 

They will use traditional designs, whereas other stations will express the most significant tourist destinations of the country, personalities and national symbols.

 

The RTA will most probably rent out spaces on both sides of the viaduct and pillars to Dubai advertising agencies for limited periods, provided that they comply with the criteria set by the authority in terms of appearance and quality.

 

The Dubai Metro system will have five lines, with the Red line scheduled to be finished in September 2009.

The RTA signed a Dh3 billion deal with Serco, a UK-based international company specialising in rail management, to maintain and operate the Red and Blue lines.

 

The first phase of the project has a total budget of Dh15.5bn and is around the half-way stage of construction.

 

The Red line, which will be 52-km long, covers the area between Rashidiya and Jebel Ali, and it will be above the ground, while the tunnel line will extend from Port Saeed to BurJuman. It will have 23 stations above the ground and one at ground level.

 

This in addition to four underground stations. The trip from end to end will take 64 minutes.

 

Real estate agents say the Metro will hugely impact property investment, as it will push up the price of residential or office units and even industrial land near and surrounding Metro Stations.

 
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