Business | Markets

Regional sovereign wealth funds target Dubai real estate investment

Regional sovereign wealth funds are "looking at Dubai today" as opportunities based on attractive valuations become more interesting, according to Dr Omar Bin Sulaiman, governor of the Dubai International Financial Centre.

  • By Rachna Uppal, Staff Reporter
  • Published: 23:05 May 31, 2009
  • Gulf News

Dubai: Regional sovereign wealth funds are "looking at Dubai today" as opportunities based on attractive valuations become more interesting, according to Dr Omar Bin Sulaiman, governor of the Dubai International Financial Centre.

"I think you will see a big shift in sovereign wealth funds. A lot of them are actually looking at Dubai today... and believe it or not, one of the sectors they are looking at is real estate.

"There are opportunities today for buyouts and to take advantage of the situation where they can come in on the real estate side or the infrastructure side," Bin Sulaiman said, addressing members of the Indian Business and Professionals Council in Dubai.

"So they will be doing that in the next few months, some have already started," he added.

The business network in Dubai - of which the Indian community forms a significant part - has raised concerns about the costs of doing business in an increasingly challenging environment.

Members of the network said some respite in the form of reduced fees for certain transactions and a freeze on others will be welcomed.

"For the first time since the global crisis, at the end of February, we started seeing deposits increase in banks, which is a very big indicator that will help resolve the challenges we have - the balance between deposits and loans.

"This was a major challenge for the banks from a liquidity point of view. It will take some time, but I think the pressure is starting to decrease, since the end of February," Bin Sulaiman said.

Some signs are already pointing towards a slight recovery in banks' liquidity situation, and strengthening loan to deposit ratios.

Regional equity markets were also up, led by Saudi Arabia's Tadawul. Investor confidence in the Dubai market is also climbing, with the Dubai Financial Market up 4.82 per cent yesterday.

"Dubai's infrastructure is almost mature. The metro is opening, [the] financial centre is there, the airports are operational, and this gives [us] a massive platform when things turn around," Bin Sulaiman said.

He urged business owners to focus on the endgame and position themselves to benefit once the economy rebounds.

Economic ties between the UAE and India continue to strengthen.

UAE exports to India have grown at a faster pace than overall growth in UAE exports, while imports from India reached $13.7 billion (Dh50.3 billion) by the third quarter of 2008.

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