DIFC aims to double in five years

Dubai International Financial Centre is beating the global slump and has set itself the target of doubling in size over the next five years.

Abdulla Mohammed Al Awar says 'the DIFC has the potential to double in size in the next five years, contributing to economic growth within the UAE and the region as a whole.' Sean McEwan for The NatioShow more

Dubai International Financial Centre, the emirate's investment market hub, has set itself the target of doubling in size over the next five years.

DIFC announced the goal in its 2011 operating review, which showed an increase in the number of financial and commercial institutions coming to the centre as well as near full occupancy of DIFC-owned property, and rising lettings in third-party developments within the centre's jurisdiction.

Abdulla Mohammed Al Awar, the chief executive of the DIFC Authority, said: "Although the past two years were exceptionally challenging from a global perspective, the community in DIFC was resilient and this was noticed in the net positive growth in the number of clients that tapped into the DIFC during this period.

"We have the potential to double in size in the next five years, contributing to economic growth within the UAE and the region as a whole."

Although no financial details were released along with the operating review, Mr Al Awar sought to reassure bondholders that a US$1.25 billion (Dh4.59bn) sukuk repayable in June would be met.

"It is the DIFC's intention to meet all debt obligations as and when they become due. Discussions are going on about this and we will share the information at the right time," he said.

The DIFC, the main financial marketplace in the Middle East, said occupancy at its commercial properties near the Gate complex remained at 95 per cent; in the DIFC-owned retail outlets in the area it rose from 72 per cent to 95 per cent last year; and in the commercial property owned by third parties it jumped from 44 per cent to 72 per cent.

The number of active registered companies in the DIFC rose 7 per cent to 848, of which 396 were regulated companies.

Office space totalling about 304,800 square metres was added in the course of the year, according to the review, and was being marketed.

Mr Al Awar said 21 of the top 30 global banks had premises within the DIFC, with a trend for East Asian institutions to move into the centre. Middle Eastern, Chinese and other Asian financial institutions accounted for 36 per cent of DIFC space, he estimated, about the same as that occupied by European entities.

The DIFC had "undisputed status in the region between Singapore and Europe", achieving high-level rankings in many of the global surveys of financial centres, Mr Al Awar said.

Some observers believe the economic and financial fallout from the Arab Spring disturbances will weaken the desire of international financial institutions to come to Dubai, but Mr Al Awar denied this.

"They are not less inclined to come here, but more so.

"If you're considering the Middle East, Dubai is the place to be," he said.

Asked about the alleged exodus of financial institutions from Bahrain after civil disturbances began there, he said: "Dubai has the usual advantages it has had for many years.

Even before the Arab Spring, it was attracting financial institutions."

Some banks had relocated staff from Bahrain to Dubai but continued to have a presence there, he added.

There were "no immediate plans to decrease DIFC rents", he said. "Occupancy rates were high so there is no pressure to cut rates."

twitter: Follow our breaking business news and retweet to your followers. Follow us