Readers who have passed through London in the past couple of years (or flicked through the local papers) might have noticed the large number of ads for property investment opportunities in Dubai. Lavish brochures, an apparently low tax regime and dazzling architecture...enough to make even the coolest investor swoon.
Fuelled by speculative buyers, apartment lots changed hands several times before the building was even built. Whilst the music played it was good fun, and no one wanted to spoil the party by asking the inconvenient question: who is going to actually occupy the mushrooming number of apartments coming on stream?
Sadly it's proving to be a pipe dream. The glossy wallpaper is peeling off to reveal nasty stains of corruption and excess leverage. The excess debt is a real problem, as the government financed its ambitious building plans with mountains of foreign debt. Hardly a great recipe for speculative real estate.
A parting thought - why build all these skyscrapers, only for them to be prematurely worn down by sandblasting from desert winds?
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