Creating a land of economic opportunities with real estate investments

The mutually supportive relationship between real estate investment and economic growth and development has long been cited as a perfect catalyst that can propel local and national economies towards a resilient and successful future.

In the annals of economic development literature, this is an inter-relationship that has often been explored from several theoretical angles: how can real estate investment shape a nation’s economic development strategies? Why do real estate investments offer more economic benefits than other investments? Does real estate investment spur economic growth or vice versa?

To find an example of how those theories can translate into practice, we need not go far. The practical answer to many of these questions is playing out right before our eyes in Dubai and all across the UAE. Consider the recent data from the Dubai Land Department – which shows that a total of 3,625 real estate transactions worth Dh12.5 billion were conducted during the week ending June 16, 2023. That staggering amount includes the sale of 189 plots for Dh2.28 billion, 2,753 apartments and villas for Dh7.01 billion.

These numbers not only indicate growing global confidence in the city’s booming real estate market but also mirror the rapid and robust growth of Dubai and the UAE’s economy and its global ranking in competitiveness.

That’s because these real estate investments create abundant job opportunities to stimulate economic activity across critical sectors that are at the heart of a nation’s progress, such as construction, retail, hospitality, education, healthcare, logistics and more. As we have seen time and again in Dubai, by catalysing these fundamental industries, real estate investments play a pivotal role in driving economic prosperity and stability.

That role also feeds into the government’s strategic implementation of business-friendly policies, visa and residency reforms, high-end infrastructure and technology landscape, and a world-class lifestyle that have put the UAE, and Dubai in particular, at the centre of global attention for foreign investments and entrepreneurship. Indeed, Dubai has recorded more than Dh263.66 billion worth of FDI inflows since 2015. It retained the top spot globally (in 2022) for the second successive year attracting greenfield FDI projects, according to the latest data from the 2022 Financial Times’ fDi Markets report. With a focus on the digital economy, creative industries, and scientific innovation, the UAE’s non-oil economy has consistently grown faster than the global GDP growth rate in recent years.

What’s more, earlier this year, the government launched the Dubai Economic Agenda ‘D33’, which includes the launch of innovative projects to make Dubai the world’s best city to live and work in. The economic value of the total targets set by the D33 is Dh32 trillion by the year 2033, which also marks 200 years since the foundation of Dubai. The agenda also aims to raise the contribution of FDI to Dubai’s economy to an average of Dh60 billion annually in the next decade to reach a total of Dh650 billion over the next 10 years.

The writer is CEO of Deyaar Development.