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Middle East - The Clients

This month's clients: Dubai Roads & Transport Authority, and Nakheel.

Dubai RoadS and Transport Authority (RTA)

Dubai's Road and Transport Authority (RTA) is leading the region in the development of alternative ways to travel. Such investment is critical as road congestion in the emirate is costing businesses more than £600M per annum. The organisation is run through five business divisions; traffic and roads; rail; marine; public transport and the licensing agency and is led by chairman Mattar al-Tayer. On an annual basis the authority is spending approximately £1.5bn on tackling congestion.

By far its most ambitious project to date is the construction of the first two lines (red and green) of the £2.3bn metro project. The first 127km of the 318km scheme have raced ahead at a frenetic pace but contractor the Dubai Urban Rail Link consortium led by Japan's Mitsubishi Corporation, has asked for time extensions. It claims that changes to the project's specifications have caused the delay. But the client is determined to force the contractor to meet the deadline of September 2009 for the first phase (red line).

The metro is just one of initiatives introduced by the RTA to calm congestion. It has widened key roads, improved junctions, built new bridge crossings over Dubai creek and improved access to the airport. But the most controversial measure was the introduction of the emirate's first road user charging system, called Salik (meaning open).

Effective from 1 July 2007 the system uses radio frequency identification (RFI) to automatically deduct a charge of AED4 (£0.55) from a prepaid account from anyone driving over the Al Garhoud bridge, one of four crossings over Dubai Creek.

The worst of Dubai's traffic problems appear to be behind it, but as the urban sprawl continues, the challenge of managing this will remain with the RTA, making it one of the emirate's biggest clients.

Top 3 Projects

- Dubai Metro (Four phase metro, first two lines = 127km under construction)
- Seventh Crossing (6 lane 1.2km crossing of Dubai creek)
- Parallel roads scheme (108km of roads through Dubai creek and Business Bay)

Nakheel

Nakheel is by far the largest developer in the United Arab Emirates and is the pioneer of the offshore island developments that have made the emirate famous. It was established in 2003 to develop Palm Jumiera and has since grown into an organisation with around 2,000 staff and £30bn in project developments and land assets. Led by chief executive, Australian Chris O'Donnel, the firm is pushing ahead with 18 major projects. These are primarily real estate developments with associated water, power and transport infrastructure.

The firm's first ever project, the Palm Jumiera taught it some valuable lessons. Complications with the dredging operations, led to the project running late. Some of the villas on its development were also criticised for the poor standard of finishing and residents were forced to move out while repairs were made.

But Nakheel has learned fast and has since vastly expanded the number of engineers and project managers working within it, including establishing an internal design group and a 250 person strong facilities management team. This team is solely focused on longer term management of the company's assets.

Despite its strong in house resource capabilities, the firm still employs a vast number of contractors and consultants and likes to maintain strong relationships with key firms, who, in turn, see Nakheel as a core repeat client.

Nakheel also has a sister company Limitless, which undertakes projects in overseas markets. But this has not stopped Nakheel from launching Nakheel International to further its own operations overseas. Limitless itself has already established a number of schemes across the Gulf and is also considering developments in Egypt, Morocco and Tunisia. The two firms coordinate operations to ensure they avoid biding for the same work.

In addition to the international and asset management divisions, Nakheel also has business operations for hotels, general developments, retail and marine projects.

The next step for the firm is to consider widening its ownership. It is currently one of the Dubai World group of companies and is 100% owned by the government but an initial public offering, where part of the company is floated on one of the local stock exchanges could be the next step.
O'Donnel has said that the firm is considering all of its options.


Top projects (all offshore coastal developments)

- Palm Jumiera
- Palm Deira
- The World
- Dubai Waterfont

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