Comments on: Total Eclipse At The Heart Of Dubai’s World

By: ajay

ajay — Mon, 30 Nov 2009 11:29:31 +0000

Minor point, but I’ve heard from fairly reliable local sources that the 20% local population is a massive overestimate, maintained by the government for political purposes, and the real figure’s about half that. IE ~10% of the population are actually nationals.

By: Richard J

Richard J — Sat, 28 Nov 2009 15:55:41 +0000

P O’Neill> AFAIK, the Qataris have made direct investments into two very high-profile (one literally) trophy London properties (I worked on one of the transactions), but in terms of capital deployed, I think they’re probably in the same order of magnitude. That said, I don’t know how much investment the Qataris have put into private real estate funds, which was the historic way most Middle Eastern SWFs invested in UK property. Dubai making direct investments through Istithmar[1] was something out of the ordinary by the standards of the region. ADIC, which is simply massive, has very rarely made direct investments into anything, but usually goes through intermediary funds.

[1] Perhaps Sovereign’s Wealth Fund is a better description…

By: Charles Lemos

Charles Lemos — Sat, 28 Nov 2009 07:51:25 +0000

Best read on Dubai World that I’ve seen. Kudos.

By: BobbyNZ

BobbyNZ — Sat, 28 Nov 2009 02:07:20 +0000

These arab sheiks suffering from “surreal schizophrenia”?

By: Stephen

Stephen — Fri, 27 Nov 2009 19:50:02 +0000

Recession is here again

By: Edward Hugh

Edward Hugh — Fri, 27 Nov 2009 16:41:52 +0000

Hi again Richard,

“If some buildings get sold for much less than expected, it’s the domino effect as everybody’s forced to revalue down lower that’s the possible danger.”

Exactly Richard, this was my impression from afar, and sitting here in Spain next to a set of banks who have stocked up to the hilt on a massive quantity of empty property (with hardly a bad loan in sight), but with no one having any real idea of what the property is actually worth in what you call an illiquid market (ie there is hardly a buyer out there), the danger that somewhat might one day get forced into actually selling something makes me personally rather nervous.

By: P O'Neill

P O'Neill — Fri, 27 Nov 2009 15:04:45 +0000

I think Qatar has much more London real estate than Dubai. Barclays was apparently hurt as much by the Qatar connection (in its shares) as any potential exposure to Dubai. Which doesn’t make sense since Qatar has years of LNG exports to help finance its debts.

By: Richard J

Richard J — Fri, 27 Nov 2009 14:14:55 +0000

Ah, don’t mind my pedantry, please. It’s actually the second-order effects of a firesale of a few high-value London office blocks that are more concerning. Since the credit crunch hit back in 2007, the GBP100m+ market has been pretty much dead. Although everybody’s been marking down the properties in the books (leaving most investors who’ve bought since, say, 2004/05 in technical breach of their loan covenants re: LTV, and in a few case, >> 100% LTV), these revaluations have been on the basis of very little evidence, so illiquid is the market. If some buildings get sold for much less than expected, it’s the domino effect as everybody’s forced to revalue down lower that’s the possible danger.

By: Oliver

Oliver — Fri, 27 Nov 2009 13:49:56 +0000

But as some lose creditworthiness don’t the others profit? Investors are not going to let the money rest unused, are they?

By: Friday Morning « the news links

Friday Morning « the news links — Fri, 27 Nov 2009 13:41:39 +0000

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