Gulf interior design spend to hit $8.6bn
Abu Dhabi, May 17, 2011
The interior design and fit out market in the Gulf region is on the recovery path, with a projected $8.6 billion worth of contracts to be awarded in 2011, up 69 per cent compared to $5.1 billion last year, said a report.
The forecast was revealed in a comprehensive report at the recently concluded "Interiors UAE 2011," the only design-led, luxury interiors show in the UAE.
The report was commissioned by UBM Built Environment, the organisers of the "Interiors UAE 2011" which was held in Abu Dhabi from May 9 to 11.
It was based on a comprehensive study prepared by Ventures Middle East, which also included a forecast on the bigger construction industry in the UAE and the greater GCC region, as well as across the retail, commercial, hospitality, residential and other sectors.
“We wanted to provide exhibitors and other industry stakeholders a deeper insight into the market in the region, and with this report, we can truly say that there is business to be made in the interior design and fit out market in the UAE and the GCC,” said Tony Crinion, event director, UBM Built Environment.
“We have had a good turn-out of exhibitors, and the feedback from them has been very positive in terms of the quality of visitors who came to see the show this year,” he noted.
This was confirmed by Clare Gilchrist of Veedon Fleece, makers of hand-made, bespoke luxury carpets, and one of the more than 100 exhibitors who showcased their products at the expo this year.
“We have had several good leads from the show, and some serious potential buyers from the UAE and Saudi Arabia with whom we will have a series of meetings after the show to discuss their particular requirements," Gilchrist revealed.
With building contracts to the tune of $89 billion freshly awarded in 2010, and a total of $43 billion projects completed last year, the interior design contractors can expect to have a steady stream of projects in 2011 and beyond, he added.
Gilchrist said the value of completed and awarded construction projects represents a definite potential for interiors and fit-outs as projects are usually contracted during the second half of the project execution.
Looking at the UAE interiors market by segment, the Ventures Middle East report saw 2011spending in the commercial buildings sector increasing to $821 million from $709 million last year.
The hospitality sector will see bigger interior spending this year which will hit $1.3 billion, up from just $406 million in 2010, the report added.
The biggest interior project potential will be in the residential segment, where an estimated $1.8 billion will be sent across various residential projects in the UAE.
“With the lower and middle income household demand remaining undersupplied in Abu Dhabi on the one hand; and the falling rentals and property values in Dubai and the luxury end in the UAE on the other, the residential construction spend, though affected, is still hopeful of making a comeback," Crinion said.
Meanwhile, building projects across the GCC are slowly being revived and fresh projects with a greater focus on quality and price have begun to progress forward, the expert added.
With Qatar’s successful World Cup bid and the increasing thrust given to tourism across various countries in the GCC, the building construction sector is likely to resume its growth path with $96 billion in building construction contracts expected to be awarded in 2011, and $101 billion estimated projects to be handed out in 2012.
The study also identified the top projects in 2010 with considerable potential for interiors and fit outs contractors. These include The La Hoya Bay Residences in Marjan Island in Ras Al Khaimah, Damac Heights in Dubai Marina, Adnoc’s new headquarters in Abu Dhabi, and the new Presidential Office in the UAE capital, he noted.
With commercial districts in Dubai, Abu Dhabi, Riyadh, Muscat, Doha and Bahrain leading the growth story in the region, the interiors contracting and fit out market is expected to reap potential growth in the years to come, said Crinion.
“With this study, we hope we have given various stakeholders in the interiors market a clear picture of what is at stake for the industry in the years to come in terms of business potential,” he added.-TradeArabia News Service