Building the capital of the future

The driving force behind the initiative is Abu Dhabi's desire to cement its place as the capital city of the UAE federation.

To this end, the government has initiated projects across industry sectors to coordinate timelines and ensure a controlled rollout of infrastructure and economic drivers, and the property to support it.

Currently the city is home to 1.4 million residents, and the government expects this to grow to 3.1 million by 2030. The majority of the new arrivals will be a white collar workforce servicing the planned new corporate and legislative hubs.

Abu Dhabi has also profited from, or is trying to catch up on - depending on the developer/investor/end user viewpoint -the building moratorium that was repealed in 2001, leaving the city with an enormous supply and demand imbalance in the real estate sector.

Business growth

While this may have helped to cushion it from the worst of the price collapses currently being felt in neighbouring Dubai, it has also meant that what commercial and residential units are available can be overpriced. The shortage has also deterred some global companies from setting up in the city due to the lack of property amenities, with Dubai or Bahrain appearing more welcoming.

It is this that the authorities are aiming to tackle with the Plan 2030, showing that Abu Dhabi is capable of becoming an international financial and trade hub, using the sustainable roll out of projects across the various industry sectors, including a focus on financial, legislative, environmental, tourism and trade developments.

A number of districts have been created, including specially-designated freehold areas in which non-citizens are allowed to buy units. The key zones being overseen by the UPC are; the Central Business District, the Capital District at Khalifa City, the Khalifa Port and Industrial zone, the Cultural District, Masdar city and Reem island and the new residential areas - all of which will be linked by a new state-of-the-art multilayered transport network.

The government has also committed close to $100bn to developing the emirate's Western Region, which accounts for approximately 83% of the land mass, but currently holds only 8% of the population.

New federal capital

The Capital District is the location planned to accommodate the seat of the UAE's federal government, and one of the key centrepieces of Plan 2030. The district will also be the main location for Abu Dhabi's own central government bodies, with the total value of projects estimated at $40bn.

Once finalised the zone is expected to provide 150,000, mostly white-collar, jobs, and house up to 370,000 people. The site will also house all embassies to the UAE and a number of tertiary education campuses, all of which will be serviced by its own transport infrastructure linking it to the rest of the city, and in effect creating a second 'hub' for the capital. The UPC is expected to unveil the final masterplans for the development of the zone during the Cityscape exhibition in April.

Surrounding districts

Saadiyat Island, which itself will contain developments valued at $28bn, will become one of the main focal points for the new city, housing a range of international cultural and entertainment attractions aimed at boosting the emirates' tourism market.

The Louvre and Guggenheim will both have museums on the island. Lulu Island will similarly become a centre for national cultural institutions, while its seaward-facing north shore is to be turned over to housing projects, predominantly low level, higher-end luxury units.

The Central Business District will be spread between the Suwwah, Mina, Reem, and the main Abu Dhabi, islands - linked by a network of 10 bridges - and consist of high-rise buildings slated to serve as headquarters for global corporations moving into the city and almost trebling the amount of commercial space in the city's current business areas (from the current 1.4m sqm to 3.8m sqm). It will also house the city's new financial centre.

Private developments

Private developers have been falling over themselves to build on designated freehold areas, with the capital's 'Big Four' of Aldar, Sorouh (which alone is developing 10 million sqm of land), Hydra and Al Qudra all having launched a range of villa and apartment communities, and accompanying commercial properties, for sale to expatriates.

These are primarily situated on the Abu Dhabi-Dubai road, along Al Raha beach, where the total cost of upcoming development is estimated at $18.5bn, and on the principal island's outlying neighbours, each of which will benefit from new bridges to ease traffic flow, with Reem Island one of the major points for developers. Reem will consist of high rise towers which will form the central business district as well as housing, mainly in apartment blocks for approximately 80,000 people. The current value of projects, which are being developed by private companies, stands at $7.8bn.

'In Abu Dhabi, we are particularly fortunate to have some strong fundamentals underpinning the real estate sector. These fundamentals of continued population growth, and planned development strategy based on the Abu Dhabi 2030 Plan coupled with a real estate supply lag provides ample opportunity to fill the end-user occupier demand gap,' said Sorouh's chief property development officer Gurjit Singh.

Developers are also targeting GCC citizens in particular, with companies such as Bloom creating villa and low rise apartment luxury developments in the heart of the city.

'The economic vision of 2030 is the biggest support to the real estate sector. You don't need the government to invest in the sector, but you need it to fulfill its stated ambitions, which they are starting to do by investing in infrastructure, which includes social, educational, and cultural infrastructure. By doing this you are creating the drivers of sustainable long term development,' said CEO Dr Hani Shammah.

Handover on the majority of these projects is scheduled to begin in 2009, although many developments have faced delays in their roll out, and will be ongoing through the cycle of the Plan's framework.

Following the continued knock-on effects of the financial crisis (at time of publication the city's offplan real estate projects had lost an average of 20% from their peak highs of mid-2008), Abu Dhabi's major developers have announced changes in priorities for many of their future developments, veering away from concentrating solely on the previously high return luxury market to add middle income community projects to their portfolios.

The UPC has also issued directives for each private developer to build a percentage of all future projects for the low income sector, a necessity that was often overlooked in the early phases of the city's development.

Western Region

The Government of Abu Dhabi has embarked on a journey to construct a brighter future for residents living and working in the six main cities located in the Western Region; Madinat Zayed, Mirfa, Ghayathi, Silaa, Liwa and the Island of Delma.

The Abu Dhabi government is believed to have estimated that investment in the region's development will total up to $100m over the next two decades, however final figures have yet to be released. A number of housing projects aimed at UAE nationals living in the region will begin from 2010, monitored by the councils of each district.

Detailed plans include improved government services in addition to the further development of the region's infrastructure. The final aim is to increase private sector investment in the region by creating the necessary infrastructure to promote business growth, as part of this $1.2bn is being spent over the next three years on building a new Mafraq-Al Ghwaifat highway.