According to a BMI Research report, the Middle East and North African construction market are expected to be worth $336 billion by 2020, up from $235 billion in 2016, a net growth of 43 percent.
Stabilized oil prices have eased pressure on governments’ budgets and as a result, new infrastructure and commercial projects are being flagged off in addition to ongoing projects associated with the Dubai Expo 2020 and many others such as Kuwait’s International Airport expansion.
According to a report published by Dubai Chamber of Commerce in January 2019, the UAE’s GDP is set to grow over the next five years on the back of Expo 2020 Dubai activities gaining momentum in the emirate. The GDP of the UAE’s construction sector is expected to grow at a rate of 4.9%.
At the year-end of the 2018 Global Construction Project Trend Report, Lodging Econometrics found that Dubai has the world’s second-largest hotel construction projects pipeline, with 168 schemes and 49,950 rooms as of 2018. Dubai is just behind New York City on the list, which had 171 hotels with 29,460 rooms under development as of end-2018.
Add to that other burgeoning sector such as aviation, aerospace, industrial, marine, etc.
Therefore, this industry has created a niche for itself in the investment market. As long as the population and lifestyle of people grow, there will always be a demand for financial, commercial and residential spaces. Technology and innovations further bring about repetitive changes in this market. This positive trait of the industry of making itself dependent on current and future trends further justifies itself to an investor.
Government authorities world-wide expend huge sums of money into this sector to attract global and financial players. Specific schemes initiated by Government bodies along with tax benefits add on to this sector’s prospects. Private participation marked with lump-sum investments made by private equities and venture capitalists represents the ever-growing hike of this sector.