Dubai’s Emaar puts new projects on hold

Bloomberg

Emaar has "put new projects and launches on hold to assist in reducing the real estate property supply in Dubai," the United Arab Emirates’ largest developer said yesterday. "The new launches in 2009 will be dependent on the review of the demand and supply situation at various income segment levels."

The global credit crunch and a drop in real-estate prices in the country have led to job cuts, lowering demand for real estate as expatriates leave the country. The number of residents leaving Dubai leapt by 86 percent in January, the Dubai Naturalization and Residency Department said Feb. 10.

The U.A.E. has used its oil wealth to turn its second largest sheikhdom, Dubai, into a transport, tourism and financial hub. With oil prices dropping more than $100 a barrel from a high of $147.27 in July and the onset of the financial crisis, the U.A.E. economy will probably expand 0.5 percent this year, slowing from 7 percent in 2008, Standard Chartered said in January.

Property prices in the U.A.E. "fell off a cliff" after banks reduced lending and speculators withdrew from the market, Morgan Stanley said in a note to investors dated Jan. 30.