Abu Dhabi Land in final stages of Dh500m deal

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Abu Dhabi Land General Contracting is in the process of finalising infrastructure contracts worth more than Dh500 million on Reem Island, said a senior official.

He also told Emirates Business that the company expects a 20 per cent rise in growth figures and is in the process of finalising joint venture partnerships with two large infrastructure and construction companies.

"We have finished the dredging, reclamation and rock revetment works at the Dolphin Island and coastal protection for the Marina Square at Reem Island's Sector 1," said Kayed Khorma, Chief Operating Officer at Abu Dhabi Land.

"And we have been just awarded the infrastructure development contract for Plot 2 and Plot 3 on Reem Island of the Tamouh development for a contract value exceeding Dh500 million. We expect to finish construction by mid-2011."

The company expects to get more contracts in 2010 he added and has a yearly turnover of around Dh500-Dh600 million.

"We are tendering for many contracts but we cannot reveal anything right now. We are also focusing on the investment side and are specialised in labour accommodations in so many areas like in Reem Island, Mussafah and other areas. We have already invested more than Dh250m in the labour accommodation business, and are planning to invest over Dh160m this year in commercial real estate. We are also in the readymix business on Reem Island as well as other projects when there is excess."

The company is expecting a growth of around 20 per cent for 2010. "We are concentrating on Abu Dhabi and UAE but don't have any plans to go outside the UAE as yet. We bid on projects apart from Tamouh and find competition very tough in the market since there are many specialized companies and we have to compete against them in terms of quality and price. Last year was a very hard year. Prices were going very high and creating issues for all contractors. Atleast, the situation is better now and contractors can plan for two years on a project against secured prices."

Abu Dhabi sees design build turnkey contracts, cost plus and fixed price contracts, he said. "When you work with big developers such as Tamouh, most of them are design and build projects. This concept was not present earlier but it has been prevalent in the past two to three years," he said.

"Right now, we are only in infrastructure works but we will be going into building systems and will start work on Yas Island in a week's time on a project with our contract value at about Dh300m."

Abu Dhabi Land is not looking at rapid diversification. "We've expanded slowly since the past three years we have been in the market," he said. "We are also finalising a joint venture partnership to work on future projects with two large companies in the infrastructure and construction business and will reveal details once things are concrete."

By Sona Nambiar

© Emirates Business 24/7 2010