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Construction Sector in UAE is Expected to Grow By 20 Percent

UAE : 01 December 2010

The construction industry within the UAE is forecasted to experience growth of about 20 percent from 2010 to 2013, according to a report.  This rate is a CAGR, compounded annually.

Rising developments within the economy are driving construction and infrastructure activities within the region, as stated in the report put together by RNCOS entitled UAE Construction Industry Outlook for 2012.

Danube Building Materials is a leading firm within the building materials, shop fittings and construction industries.  Danube has recently launched a Dh 50 million (or $13.6 million) store in the Dalma Mall.  This location of Danube Buildmart follows the launch of a smaller DH 15 million location in Dubai’s Ibn Battuta Mall.

Chairman of Danube Building Materials, Rizwan Sajan, stated that the bullish forecasts for the construction industry within the UAE have driven the company to focus on a stronger domestic presence.  Sajan noted that these plans create excellent investment and development opportunities, as well as prospects for other players within the industry.

Danube’s growth echoes the stable recovery seen across the UAE and highlights the important place building material suppliers have in this climate of growth, where quality, aesthetics and design have a large impact on the iconic projects underway.

The company has a goal to reach Dh 2.5 billion to Dh 3 billion over the next three or four years with a full market recovery and more normal price levels.  As such Danube Building Materials has made announcements regarding a possible IPO (initial public offering) listing in either the UAE or Saudi Arabia sometime within five years.

The move to go public has been pushed by strong growth seen within the company over the last number of years.  In 2009 Danube hit a peak and turned over Dh 1 billion in sales even in the midst of the difficulties brought on by the economic crisis.  The company noted that a dual listing in Saudi Arabia and the UAE is a possibility.

As payments between contractors and developers begin to improve and flow in the UAE, signs are indicating further improvements that support healthy growth being experienced within the construction industry of the Emirates, stated Sajan.

As such, he also said that Danube is focusing on operation expansion and strengthening their position with the goal to leverage opportunities as they come.  The company is confident that the construction industry within the UAE will continue to develop and improve over the coming years.

Paul Holdsworth, Staff Writer, Gulf Jobs Market News
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