meed-logo

line1 line2 line3
SIGN IN / REGISTER

Dubai construction needs major project launches

25 April 2023

Related reads on the UAE's construction and transport sectors:

> Two billion riders use Dubai Metro

> Residential property close to Dubai metro outperforms market

> Local firm wins Jubail Terraces contract in Abu Dhabi

> Foster designs Dubai’s first vertiport

> Damac launches new project in Dubai Business Bay

> Dubai returns to the iconic with Candy towers project

> Nakheel awards Jebel Ali Village construction contracts

> Bloom appoints contractor for Abu Dhabi project

> Firms seek to qualify for UAE-Oman rail works

 

Growing demand for property in Dubai combined with a resilient economy have brought winds of optimism to the emirate’s real estate market. At the same time, the government’s handling of Covid-19 and recent measures to improve the business environment have strengthened Dubai’s position as a safe haven.

Over the past year, there has been record demand for premium properties in the emirate, mostly driven by wealthy international buyers from markets such as Russia, India and Europe.

According to a recent report by Luxhabitat Sotheby’s International Realty, Dubai’s super-prime residential market enjoyed a strong start to 2023, with a 24.9 per cent increase in prices per square foot compared with the previous quarter.

The upswing has resulted in developers launching a number of new schemes. Projects announced in recent months include Al-Habtoor Group’s estimated AED9.5bn three residential developments; Shamal Holding’s Baccarat Hotel & Residences in Downtown DubaiDamac Bay by Cavalli.

In Jumeriah Lake Towers, Dubai Multicommodities Centre in partnership with Ellington Properties has launched the AED1.2bn high-rise mixed-use Upper House project, while in Meyan MAG Property Development is developing the AED3bn Keturah Reserve residential scheme.

New masterplans have been conceived too, including the estimated $5.4bn mixed-use Dubai South project announced by Azizi Developments in January 2023.

Dubai is also returning to what it is known for: eye-catching, iconic projects. Later this year, a joint venture of Dubai World Trade Centre and the UK’s Candy Capital is expected to announce a three-tower project billed as a super-prime real estate development in Dubai’s One Central commercial district. The UK firm is known for London’s One Hyde Park, one of the wealthiest property residences in the world.

Slow recovery

Yet a closer look at the number of awarded contracts in the construction and transport sector reveals that the market is still playing catch-up, despite the growing hype.

The value of contracts awarded increased only slightly from $6.8bn in 2021 to $8.42bn in 2022, according to data from regional projects tracker MEED Projects. This is still far off the pre-pandemic level of $13.6bn in 2019. It is also only a fraction of the value of awards in 2016 and 2017, when signed contracts totalled $24.68bn and $26.14bn, respectively.

The backdrop to the weaker value of recent awards is the dearth of major construction contract awards as the government cut spending on major infrastructure projects. This has led to the market being driven mainly by private real estate developers launching smaller projects.

A few exceptions stand out, including the $260m contract awarded in January to China State Construction Engineering Corporation to construct Damac’s Cavalli Casa tower. Moreover, there are clear signs that the trend is changing. 

In addition to these projects, there are several other large-scale projects in the works, such as the estimated $1.2bn Waldorf Astoria Hotel by Al-Habtoor Group and Nakheel’s revived Palm Jebel Ali project, for which $4.6bn in funding was secured in November 2022.

The Palm Jebel Ali is about three times larger than the Palm Jumeirah, and will significantly increase the amount of waterfront land available for development in Dubai.

The soon-to-be awarded MGM Resort, Bellagio and Aria Hotels development by local developer Wasl is estimated at $500m. The three hotel resorts will be constructed on a man-made island off the coast in the Umm Suqueim area. The scheme is expected to feature 1,400 hotel rooms and apartments, in addition to retail, food and beverage and entertainment options.

Transport awards

It is hoped that the award of major infrastructure contracts may also restart this year, with the upcoming extension to the Dubai Metro network. After being put on hold, the scheme moved to the design stage in 2022. 

The Blue Line project involves constructing more than 20 kilometres of new lines, about half of which are underground, in order to extend the existing Red and Green lines.

Dubai is also considering plans to restart the emirate’s largest construction project, the AED120bn ($33bn) expansion of Al-Maktoum International airport. 

The expansion was officially launched in 2014. It involves building the biggest airport in the world by 2050, with the capacity to handle 255 million passengers a year. An initial phase, which was due to be completed in 2030, will take the capacity to 130 million a year.

Tendering for work on the project stalled with the onset of the Covid-19 pandemic in early 2020.

The margins became negative in the sector, and we cannot compete with the local companies or the government-backed Chinese corporations

International contractor

Contractor sentiment

The sector’s incomplete recovery from the pandemic is confirmed by the net value of contract awards, calculated by subtracting the value of completed work from the value of awarded work. 

Since 2018, the value of awarded contracts has been smaller than the amount of completed work, meaning contractors have fewer upcoming jobs.

Under these circumstances, companies that specialise in major construction projects are looking to other markets. 

“The UAE market is too calm. There is not enough work for us,” a local contractor tells MEED. “We are looking to expand our activity to Saudi Arabia. The work is there now.”

Some international companies, having faced long payment delays or financial losses, have left the region. “The margins became negative in the sector, and we cannot compete with the local companies or the government-backed Chinese corporations,” said one international contractor.

As it stands, there are over $42bn of projects in the bid, design and study stages in Dubai, according to MEED Projects. 

If major projects, such as the Al-Maktoum airport expansion, move into construction, they will provide a major boost for Dubai’s construction and transport industry.

This month's special report on the UAE includes: 

> GOVERNMENT: Abu Dhabi strengthens its position at home

> ECONOMY: UAE economy steers clear of global woes

> BANKING: UAE lenders chart a route to growth

> UPSTREAM: Strategic Adnoc projects register notable progress

> DOWNSTREAM: Gas takes centre stage in Adnoc downstream expansion

> POWER: UAE power sector shapes up ahead of Cop28

> WATER: UAE begins massive reverse osmosis buildup

> CONSTRUCTION: Dubai construction needs major project launches

https://image.digitalinsightresearch.in/uploads/NewsArticle/10784019/main.gif
Eva Levesque

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Consultant wins Jeddah metro design

    22 May 2026

     

    French engineering firm Egis has been appointed to undertake the preliminary design consultancy for the Jeddah Metro Blue Line project.

    The project client, Jeddah Development Authority, issued the tender in early January, when MEED exclusively reported that Saudi Arabia had restarted plans to build the Jeddah Metro.

    Engineering consulting firms submitted bids in April, as MEED reported.

    The Blue Line will run from King Abdulaziz International airport and connect to the Haramain high-speed railway station.

    The line will be 35 kilometres (km) long and will include 15 stations.

    Project history

    Plans for the Jeddah Metro were first publicly floated in the early 2010s and were formally packaged into a wider Jeddah public transport programme around 2013-14.

    In 2014, French engineering firm Systra was appointed to complete preliminary engineering for the Jeddah Metro, as MEED reported at the time.

    In the same year, US-based engineering firm Aecom was awarded a SR276m ($74m) contract to provide pre-programme management consultancy services.

    Under its 18-month contract, Aecom was expected to provide staff to support preliminary planning and design work for various phases of the metro project.

    This was followed by the appointment of UK-based architectural firm Foster + Partners in 2015 to design the metro stations.

    The project then stalled as government spending priorities were reset and major capital programmes were reviewed following the fall in oil prices in 2015, with the metro’s scope, cost and delivery model coming under reassessment.

    Early concept designs envisaged a multi-line network integrated with buses and, later, other city-wide mobility upgrades.

    Route details

    According to Jeddah Transport Company’s website, the scheme comprises 81 stations and 197 trains serving more than 161km. The network will have four lines:

    • Orange Line: a 44.8km line running along Al-Madinah Road and Old Makkah Road, with 29 stops including one at Obhur Bridge
    • Blue Line: a 35km line running from King Abdulaziz International airport to the Haramain high-speed railway station, with 15 stations
    • Green Line: a 17km line running through the city centre, from the downtown area to the Haramain railway station, with nine stops
    • Red Line: A 59.7km line running from King Abdullah Stadium north to Old Makkah Street through King Abdulaziz Road and King Abdullah Road, with 25 stops

    > Be recognised among the best in the industry at the MEED Projects Awards 2026 …

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16949416/main.jpg
    Yasir Iqbal
  • Egypt signs gas deal with QatarEnergy and Exxon Mobil

    22 May 2026

    Egypt’s Ministry of Petroleum & Mineral Resources has signed a preliminary gas agreement with state-owned QatarEnergy and US-based Exxon Mobil.

    The memorandum of understanding (MoU) focuses on cooperation in the development of natural gas discoveries in Cyprus.

    The plan involves transporting gas from offshore discoveries in Cypriot waters to Egypt via pipelines.

    In a statement, Egypt’s Ministry of Petroleum & Mineral Resources said that the deal would strengthen the North African country’s status as a regional hub for natural gas trading.

    The agreement was witnessed by Egypt’s Prime Minister Mustafa Madbouli.

    It was signed by Muhammad Al-Bajouri, from the legal affairs department of the Ministry of Petroleum & Minerals, and Kanan Nariman, vice-president for the development of liquefied natural gas (LNG) at Exxon Mobil.

    It was also signed by Ali Immunae, director of international exploration and production at QatarEnergy.

    Commenting on the MoU signing, Saad Sherida Al-Kaabi, the minister of state for energy affairs, and president and chief executive of QatarEnergy, said: “This MoU represents an important step in advancing regional energy cooperation across the Eastern Mediterranean through unlocking the long-term commercial potential of natural gas resources across that region.”

    Egypt’s Ministry of Petroleum & Mineral Resources said the agreement paved the way for QatarEnergy and Exxon to take advantage of existing Egyptian infrastructure in the gas sector, especially the country’s existing LNG export terminals.

    Under the terms of the agreement, a study will be conducted to analyse the feasibility of linking the gas discoveries in Cyprus to Egypt’s gas facilities.

    The signatories will also establish a commercial framework aimed at achieving “the maximum possible benefit from natural gas resources in both Egypt and Cyprus”.

    Egypt’s Minister of Oil and Gas Karim Badawi said the ministry has been working with ExxonMobil to explore cooperation on the development of gas discoveries in Cyprus.

    He said the partnership with Egypt would help QatarEnergy and Exxon reduce the cost of developing the discoveries while allowing Egypt to achieve an economic return.

    READ THE MAY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Global energy sector forced to recalibrate; Conflict hits debt issuance and listings activity; UAE’s non-oil sector faces unclear recovery period amid disruption.

    Distributed to senior decision-makers in the region and around the world, the May 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16944918/main.jpg
    Wil Crisp
  • Kuwait’s Heisco working on active projects worth $3.5bn

    22 May 2026

     

    Kuwait’s Heavy Engineering Industries & Shipbuilding Company (Heisco) is in a strong position to weather challenges in the country’s project market, with active projects worth $3.5bn, according to documents seen by MEED.

    The company also has active maintenance and service contracts that are worth $843m.

    Heisco’s projects span the oil, gas, power, water, construction, transport and industrial sectors.

    The company’s biggest active project contract is the $576m project to upgrade Kuwait’s Doha West power station.

    This contract was awarded to Heisco by Kuwait’s Ministry of Electricity, Water & Renewable Energy (MEW) in July 2024.

    The company’s second-biggest active project is focused on the construction of crude oil pipelines and associated works in North Kuwait.

    This $565m contract was awarded to Heisco by Kuwait’s state-owned upstream operator Kuwait Oil Company (KOC) in February this year.

    Other major project contracts include a $442m MEW contract for the rehabilitation of the Az-Zour South power and water distillation station and a $223m KOC contract for the construction of flowlines and associated works in the West Kuwait Area.

    Heisco’s biggest active maintenance contract is worth $295m and is focused on providing mechanical maintenance services at Kuwait’s Mina Abdullah Refinery.

    This contract was awarded by the state-owned downstream operator Kuwait National Petroleum Company (KNPC) in July 2023 and it officially started in September that year.

    The contract is currently due to conclude in November 2028.

    Heisco’s second-biggest active maintenance contract is worth $95m and was awarded by Wafra Joint Operations (WJO) for work in the Divided Zone, which is shared by Kuwait and Saudi Arabia.

    WJO’s onshore operations cover an area of about 5,000 square kilometres in the Divided Zone.

    Saudi Arabian Chevron and Kuwait Gulf Oil Company are equal shareholders in WJO.

    Six major fields have been discovered in the WJO area to date: Wafra, South Fuwaris, South Umm-Gudair, Humma, Arq and North Wafra.

    Heisco’s Wafra maintenance contract was awarded in October last year and officially started in November the same year.

    The contract is expected to conclude in May 2031 and its scope is focused on the maintenance of tanks and vessels as well as the provision of welding services.

    Market headwinds

    Kuwait’s oil and gas sector has been severely impacted by the blockade of the Strait of Hormuz, through which all of its crude exports are normally shipped.

    The country recorded zero crude oil exports in April for the first time since the end of the Gulf War in 1991, according to shipping monitor TankerTrackers.com.

    While the closure of the Strait of Hormuz is expected to have a significant impact on Kuwait’s project sector for some time, Heisco’s strong project pipeline is likely to help it weather the challenging economic environment.

    READ THE MAY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Global energy sector forced to recalibrate; Conflict hits debt issuance and listings activity; UAE’s non-oil sector faces unclear recovery period amid disruption.

    Distributed to senior decision-makers in the region and around the world, the May 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16792105/main.png
    Wil Crisp
  • Eni makes oil and gas discovery in Egypt

    22 May 2026

    A joint venture of Italy’s Eni and state-owned Egyptian General Petroleum Corporation (EGPC) has made a major oil and gas discovery in Egypt’s Western Desert region.

    The partnership, known as Agiba Petroleum Company, made the discovery with an exploratory well drilled in the Bustan South block.

    Initial estimates indicate the presence of approximately 330 billion cubic feet of gas and 10 million barrels of condensate and crude oil.

    Together, this is a total of 70 million barrels of oil equivalent (boe), making the discovery Agiba Petroleum Company’s biggest in 15 years.

    The new discovery is located only 10 kilometres from existing facilities and infrastructure, which should enable rapid development and connection to production.

    The well revealed several sandstone and limestone reservoirs, according to a statement from Egypt’s Ministry of Petroleum & Mineral Resources.

    The ministry said: “This new discovery reflects the success of the Ministry of Petroleum & Mineral Resources’ efforts and the incentives it offered to partners to intensify exploration activities in areas adjacent to existing fields.

    “This facilitates new discoveries near existing infrastructure and production facilities without the need for new infrastructure development.

    “This contributes to reducing the cost of producing a barrel, accelerating the integration of discoveries into the production map, and encouraging partners to implement the latest data collection and analysis technologies to increase the chances of successful exploration.”

    Egypt is seeing increased interest in its oil and gas resources due to disruptions to shipping through the Strait of Hormuz, which have significantly reduced oil and gas exports from the GCC and Iraq.

    READ THE MAY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Global energy sector forced to recalibrate; Conflict hits debt issuance and listings activity; UAE’s non-oil sector faces unclear recovery period amid disruption.

    Distributed to senior decision-makers in the region and around the world, the May 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16944815/main.jpg
    Wil Crisp
  • King Salman airport selects three contractors for apron ECI

    21 May 2026

     

    Saudi Arabia’s King Salman International Airport Development Company (KSIADC) has selected three groups to deliver the Terminal 6 apron, taxiways and other airfield infrastructure at King Salman International airport (KSIA) in Riyadh.

    KSIADC, which is backed by Saudi sovereign wealth vehicle the Public Investment Fund, will initially deliver the project on an early contractor involvement (ECI) basis.

    The selected groups are:

    • Nesma & Partners / Limak / Samsung C&T / Alayuni Investment & Contracting (local/Turkiye/South Korea/local)
    • Shibh Al-Jazira Contracting Company / Top International Engineering Corporation (local/China)
    • Al-Rashid Trading & Contracting Company / IC Ictas (local/Turkiye)

    The ECI process requires selected contractors to submit methodologies for the project and a design proposal. One team will then be selected for the construction.

    MEED understands that the total package could be worth upto $800m.

    In March, MEED exclusively reported that KSIADC had selected three groups for the construction of Terminal 6 at KSIA in Riyadh.

    In November last year, MEED exclusively reported that KSIADC was targeting mid-2026 to award the contract for the construction of Terminal 6.

    MEED reported in May 2025 that US firm Bechtel Corporation had been appointed as the delivery partner for the terminals at KSIA.

    According to local media reports, KSIADC’s acting CEO, Marco Mejia, said the project developer had completed the project’s masterplan.

    The reports added that Terminal 6 will boost the airport’s capacity by 40 million passengers.

    The project is expected to be delivered before the start of Expo 2030 Riyadh.

    MEED’s April 2026 report on Saudi Arabia includes:

    > COMMENT: Risk accelerates Saudi spending shift
    > GVT &: ECONOMY: Riyadh navigates a changed landscape
    > BANKING: Testing times for Saudi banks
    > UPSTREAM: Offshore oil and gas projects to dominate Aramco capex in 2026
    > DOWNSTREAM: Saudi downstream projects market enters lean period
    > POWER: Wind power gathers pace in Saudi Arabia
    > WATER: Sharakat plan signals next phase of Saudi water expansion
    > CONSTRUCTION: Saudi construction enters a period of strategic readjustment
    > TRANSPORT: Rail expansion powers Saudi Arabia’s infrastructure push

    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16937556/main.jpg
    Yasir Iqbal