Gulf Construction Sector Thrives Amidst Regional Challenges

Summary:

Gulf construction remains strong due to government spending and ongoing megaprojects, despite rising material costs and the impact of regional conflicts. S&P Global Ratings reports that the UAE has 628 projects worth $138 billion and Saudi Arabia has 421 valued at $168 billion. However, construction costs are expected to rise significantly, affecting contractor margins. Real estate developers face a tougher outlook, particularly in Dubai and Qatar, where expatriates make up a large portion of the population. Dubai's residential market is slowing, while Abu Dhabi's limited supply may support prices. Luxury real estate is also vulnerable to changes in investor sentiment.