Emaar's Alabbar: 'Real estate sector must unite'

'Today the real estate sector is witnessing a healthy correction as a result of the global financial conditions,' he told delegates at DIFC Week.

He said companies in the sector were working to ensure that supply meets demand, but added that he expects to see consolidation among companies, especially 'third party developers who are facing lending difficulties in today's market'.

Recent reports have suggested that property prices on the Palm Jumeirah, developed by rival firm Nakheel, have dropped by as much as 40%. Apartments in Emaar's Burj Dubai development have also slipped, with reports suggesting prices have halved in recent weeks.

Elsewhere in Dubai, property prices have seen far smaller falls so far, but with sales drying up and banks becoming stricter over their lending conditions, developers and real estate agents are now beginning to lay off staff. Damac is chopping around 200 jobs and an unconfirmed number were laid off by Omniyat.

In another sign of a weakening market, developer MiNC asked investors to stump up extra cash before its project could move forward in Jumeirah Village South. Added to this, the Global Property Guide has downgraded its investment rating on Dubai residential property to two stars.

Emaar has not been able to escape the gloom surrounding the property market. Asked about the recent collapse in its share price to Dhs2.73, Alabbar said this was down to poor sentiment among investors who wanted to cash out because of the current global financial turmoil. 'Markets are governed by sentiment,' he said.