How will Dubai’s 2040 plan affect the economy and real estate sector?
The 2040 Master Plan is a modern and forward-thinking plan that will reinforce Dubai’s position as a major hub of the region, both in terms of quality of living and in terms of economic leadership. The focus on development of nature reserves, parks, and public transportation systems will help the city reinforce its place as one of the preferred cities for expats globally, ensuring indirect economic benefits and an increase in population.
Nick Maclean, MD CBRE MENAT commented, “The key take-aways from the 2040 Urban Master Plan are: the objective to grow the resident population; the integration and complementarity use of land and the built environment; the recognition of the importance of future investment; and the acknowledgement that to remain the regional business hub the Emirate has to appeal to employers & employees as a place that they want to spend their lives. Similar considerations are critical to all national and city urban plans. Historically Dubai has created an extraordinary commercial and tourism hub and that achievement has been because of the Government’s willingness to be reactive to change and proactive in its support of innovation.“
We asked our CBRE advisors in our Dubai team, their thoughts are on this initiative.
What will this mean for Dubai?
The 2040 Master Plan is expected to create a range of economic opportunities within Dubai moving forward and as the plan is implemented. Further enhancing and developing the city’s transport and social infrastructure, such as schools and healthcare facilities, is a central focus of the plan. Companies which can assist in delivering these requirements will be well-placed to benefit. As these projects are delivered, naturally there will also be opportunities for both local and international operators of these new facilities.
Will more companies relocate to Dubai?
The 2040 Master Plan highlights the forward-thinking nature of the Dubai Government and is further backed by the success the Emirate has witnessed in economic development since the first master plan in the 1960’s. This forward-thinking nature and successful track record are expected to further support business confidence in the Emirate moving forward.
What will be critical in attracting companies and foreign investment will be the integration and implementation of the Master Plan in conjunction with the range of economic initiatives and reforms which have been announced over recent years, such as the retirement visa, 100% foreign ownership and others. These initiatives, coupled with continued focus on residents’ quality of life, will play a pivotal role in supporting economic growth.
Why is it appealing for companies to move to Dubai?
There are numerous factors which influence business and economic activity, two of which are front and center in the 2040 Master Plan – infrastructure development as well as talent pool development and attraction. Dubai benefits from world-class infrastructure as it is, however, the continued focus on enhancing this infrastructure and integrating new technologies serves to support future business needs and creates opportunities for new companies and business models.
Similarly, having access to top talent is a major consideration for all businesses. Through the continued focus on quality of life, as evidenced in greater dedication of space to healthcare and educational facilities, enhancements to the public realm and provision of new leisure and tourism activities, Dubai is poised to enhance its attractiveness as a destination to live, work and play.
What is the impact on the hospitality and leisure sector?
The plan also highlights tourism & leisure, logistics, technology, and other knowledge-based sectors as central drivers. We expect that along with the Master Plan, there will be a range of other initiatives to further support investment and growth in these sectors. Importantly, there is also a large focus on sustainable development and enhancing quality of life. These elements play a key role in attracting and retaining top talent.
More direct economic benefits are expected from the strengthening of Dubai’s place as a leading financial and tourism center in the region. The importance of the financial services and the classification of Downtown and Business Bay as the financial heart of the city is a clear continuation of the existing success of DIFC for instance. Tourism is expected to gain in momentum and become an increasingly important economic driver for the emirate, leveraging on existing assets (sun and sea offering in the JBR / Marina area) and developing a new strategy for the 2020 Expo area (focusing on international events). Tourism is known as a great employment generator as well as an industry with significant impact on many other sectors. Hence, we expect this focus on tourism to bring important economic growth of the emirate.
The Dubai vision has been developed and has evolved over time, starting from the initial master plan in 1960, to the 2040 Master Plan which, importantly, features a “flexible urban planning law.” This integration of flexibility acknowledges the accelerated pace of change in today’s world and is expected to support Dubai’s ability to quickly respond to changing economic, social, and environmental requirements in a post-pandemic world.