The FIG Sales and Marketing team just returned from spending a week in the United Arab Emirates at the "Global Citizenship and Real Estate Expo." We wanted to see what else was out there in the world of real estate and make some more international contacts. And wow, was it educational. If you appreciate real estate and construction, a visit to the Emirate of Dubai should be on your bucket list! Dubai is home to the Burj Khalifa, the tallest building in the world. Not only is that building a sight to behold, but the surrounding development as well as the entire city are an engineering and construction marvel.
Oh, and if you visit the UAE, you need to check out Ferrari World!
After spending a week there, here are 3 quick takeaways:
1) Construction Labor, Supply and Demand. Much of the Dubai skyline has been built within the last 15 years. This includes a massive two mile long marina that was excavated right out of the desert. That kind of construction comes through massive amounts of labor. But this labor is at a cost. Dubai relies almost exclusively on immigration to fill these construction jobs. Quality of life for these workers doesn't seem to be a priority for developers or the government. This hasn't stopped them from building massive amounts of new luxury apartments. But the laws of economics transcend borders, with Dubai currently experiencing dropping prices and rents.
2) Affordable Housing. Playing off of the previous point: developers are building luxury apartments as quickly as they can. And they're bringing in low paid workers from wherever they can. Ironically (just like here in the US), they're bringing in workers who can't find an affordable place to live while they build properties that just aren't needed. Affordable units for sale and rent isn't just a US problem. It's worldwide.
3) For Sale: US Visas. A huge focus of the conference we attended was the US EB5 Visa Program. If you have at least $500,000, you can "invest" into the USA and be given a Visa. The key is that your $500,000 has to create at least 10 jobs. Do this and you've got your Visa! Of course it's more complicated than we've laid out here. But this industry is huge, with many developers now relying on facilitators of this program to raise funds for real estate here in the US at interest rates and terms that blow banks out of the water.
There is so much more we saw and learned, but we wanted to share the above thoughts with you in the meantime.