Sector Property build

More than two years after the global financial crisis first hit property prices, developers in the Emirates are still facing steep challenges. Only Emaar Properties, the country's first master developer and the builder of the tallest tower in the world, the 828-metre Burj Khalifa, has remained consistently profitable during the past two years. This is largely a result of its growing portfolio of hotels, shopping centres and retail outlets, which boost income every quarter. Gross profits for the last fiscal year may have declined by as much as 35 per cent for property developers in the UAE, according to the latest research from Nomura Securities. In the next couple of weeks, only Emaar is expected to post a net profit for the fourth quarter of last year. "These [other] companies are still clearing up their balance sheets and looking for a new model," says Chet Riley, an analyst at Nomura. "The numbers are going to reflect a challenging fourth quarter." Emaar, he says, will stand out with a year-end profit of about Dh2.8bn on revenue of Dh11.3bn. But that could be tempered in the first quarter of this year when Emaar is expected to write down its investment in Amlak and, possibly, its Indian joint venture Emaar MGF. Despite the sell-off of Aldar stock in the past few days on the back of its announcement about government support comprising a Dh10.9 sale of assets on Yas Island, Dh5.5bn of residential units and land and a Dh2.8bn convertible bond, analysts feel the company is now leaner and healthier.