ADDED organizes 3rd round table discussion with key investors and businessmen from real estate and tourism
The Abu Dhabi Department of Economic Development (ADDED), in cooperation with the Abu Dhabi Council for Economic Development (ADCED), has organized the 3rd roundtable discussion dedicated to businessmen, investors and developers in the tourism and real estate sectors. The meeting is part of ADDED’s continuing efforts to implement the directives of the Abu Dhabi Government to enhance the support to the private sector through the economic stimulus package announced earlier by the Abu Dhabi Executive Council.
The remote roundtable meeting witnessed the presence of H.E. Mohammed Ali Al Shorafa, Chairman of ADDED; H.E. Falah Mohammad Al Ahbabi, Chairman of the Department of Municipalities and Transport (DMT); H.E. Mohamed Khalifa Al Mubarak, Chairman of the Department of Culture and Tourism (DCT) Abu Dhabi, and H.E. Dagher Al Marar, Acting Director General of ADCED.
The meeting kicked off with a discussion on the state of the real estate sector with the participation of businessmen, investors, real estate developers, as well as owners of national and private sector companies. The group discussed the various issues they face concerning their economic activities in light of the economic restrictions due to the COVID-19 pandemic, which had affected real estate businesses.
The participants collectively agreed that ensuring the continuity of executing real estate projects has been one of the most important challenges they currently face, as well as securing the returns and revenues as expected to enable them meet their dues on loans to banks and financial institutions. The participants also expressed their optimism on the real estate sector’s capability to recover following the government’s consistent support to other economic sectors by providing financial liquidity to the market used for purchasing or leasing, thereby maintaining market demand.
ADDED officials have assured that the meetings have been setup to find solutions that would maintain business continuity and boost activities in non-oil sectors in line with directives of the Abu Dhabi Government, which has announced its continuous support to private sector companies through a range of economic incentives and stimulus packages to keep their business, and continue to take part in Abu Dhabi’s economic growth
The authorities recognized that the real estate sector, like other economic sectors, was directly affected by the spread of COVID-19 pandemic which had impacted the global economy and that the Abu Dhabi Government has been in cooperation with the private sector. The authorities spare no time to help accelerate the recovery of affected sectors through proactive and immediate measures and finding smart solutions to address the losses caused by the current situation.
During the meeting, businessmen and real estate developers highlighted that one of the major challenges is completing their projects on time because of the current situation as relevant sectors are directly affected and are facing difficulties, particularly the retail sector. The participants highlighted the challenges in sales and leasing activities due to the drop in tourism traffic and the complete absence of buyers in addition to difficulties in paying their loans and dues to banks.
They added that many companies renting their offices have failed to pay their rents as their businesses had been adversely affected by the restrictions on business activities amidst the COVID-19 pandemic, and this has led to unavoidable delays for real state companies to pay their financial dues to banks.
Property developers have requested for increased government support to direct banks to grant them more facilities that help them adjust with the current crisis. They suggested that specific initiatives can be implemented to enhance the efficiency of companies and alleviate their financial burden through loans and thereby reduce the severity of their losses.
The meeting participants also recommended an allocation of a funding initiative to be managed by the Abu Dhabi Government to help support the affected sectors, including real state. They suggested that the ‘lending options review’ committee, which was announced as part of the Abu Dhabi Government’s stimulus package of initiatives, can review companies’ requests for funding to enable them secure the necessary financial support from national banks.
Furthermore, owners of the real estate companies highlighted the importance of reconsidering government fees, which are placing an additional burden on companies that already suffer a loss of revenue as a result of the COVID-19 spread. They also shared their concerns over the difficulty of procedures in submitting real estate projects which creates additional loss for both the property developers and real estate companies.
As for the tourism sector, many business owners and investors joined the second roundtable discussion with the presence of top-level officials of ADDED and DCT. They discussed the impact of the current COVID-19 crisis on the global tourism industry, which is now going through a major slowdown because of the local and international travel restrictions as part of the preventive measures placed by the UAE to help combat the spread of the virus.
ADDED and DCT top-level officials highlighted that relevant government entities are closely monitoring and assessing the negative impact of the recent events on the tourism sector around the world. They discussed these concerns with industry stakeholders with the aim of developing new and innovative ideas that can help revive the sector and mitigate the effects of COVID-19 on their business. They also touched on the next steps that can be done to reduce the losses of tourism companies in Abu Dhabi.
Participants further called on all government entities in the emirate to speed up the process of providing support through the economic stimulus package to reduce the financial burden on tourism companies, hotels, and other relevant businesses by reducing government fees and taxes as well as facilitate the required procedures. They commented that these supporting initiatives are highly important not only on the short term, but also for the longer period.
Owners of tourism facilities also looked into the possibilities of offering their unoccupied hotel facilities to the government which may require to expand its capabilities to implement the precautionary measures against the further spread of COVID-19. They raised their concerns that the tourism sector’s recovery period is not going to be immediate as compared to other sectors that have been impacted by the global health situation, considering the reality that people’s confidence to travel safely will take time even after the crisis and that support from airlines companies will ease efforts to promote Abu Dhabi as one of the safest tourism destinations in the world.