(Bloomberg) -- Dubai's largest developer is temporarily halting new projects amid a property glut that, combined with the coronavirus pandemic, has shaved nearly a third off house prices in the past six years.
“We don't build anymore,” Emaar Properties PJSC Chairman Mohamed Alabbar said at a conference in Dubai on Monday. “The government entities decided to stop new developments almost a year back, but Covid definitely put the brakes on.”
The comments marked a rare admission from Emaar, which for years has resisted calls to stop construction even as new properties flooded the market and drove down values. Home prices in Dubai, the Middle East's main business and financial hub, have slumped by more than 30% since 2014, forcing the government to set up a committee to manage supply and demand.
Alabbar was criticized by Damac Properties PJSC Chairman Hussain Sajwani last year as the main culprit in perpetuating the city's oversupply. Sajwani said Emaar offered payment plans that encouraged speculation and wouldn't slow building even when the majority of other big developers, including Meraas Holding LLC and Nakheel PJSC, did.
Emaar, which built the world's tallest tower, Dubai's Burj Khalifa, declined to comment at the time.
Read: Dubai Faces a ‘Disaster' From Overbuilding, Top Developer Says
With the onset of the pandemic, property companies worried about their cash flow and stopped projects as demand from foreign and local investors evaporated.
Alabbar said demand is now picking up amid discounts offered by developers. Demand from buyers in India, Russia and Saudi Arabia is strong, he said.
Alabbar's in no rush to sell shares in Noon.com, an online retailer he founded, he said.
“We are four years old and growing fast, we don't think we should put it under quarterly results pressure,” he said. “We want to make the right decision, we need to plan ahead and I think we are on the right track.”
DP World Invests
At the same conference, the chairman of DP World, one of the world's largest port operators, said trade between the United Arab Emirates and Israel could amount to $5 billion annually after the two nations normalized ties earlier this year.
Sultan Ahmed Bin Sulayem, who's also the Dubai-based company's chief executive officer, added he was ready to invest more in the U.K., whether or not the country struck a Brexit deal with the European Union.
“We can deal with” either situation, he said. But they need to “make up their mind,” he said.
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