Staff axed as credit crisis hits Dubai
Architects and developers in Dubai are freezing recruitment and making redundancies as the emirate’s real-estate market begins to crumble.
The news follows one of the worst weeks in Dubai’s economic history, with the Dubai Financial Market dropping 32 per cent last week over seven days.
One of Dubai’s largest developers, Damac Holding, announced last week that it would axe 200 jobs, while other developers such as Omniyat and Emaar warned of redundancies.
Gordon Affleck, design principal for RMJM Middle East, admitted the 350-strong practice has already laid off staff.
‘We’ve had a little bit of tidying house,’ said Affleck. ‘It’s always regretful, but we could see something coming down the line.’
A source close to the practice said that less than 20 redundancies were made, mostly at architectural technician level.
The redundancies are the first sign that Dubai’s seemingly unstoppable real-estate bubble has burst. It is also understood that developers are also cancelling or postponing major projects.
In a statement last week, developer Nakheel said it will slow development, and rumours are circulating that Palm Deira, the largest of Nakheel’s manmade island developments (pictured above), is on hold indefinitely.
The statement said: ‘The next few months will see a scaling back of activity around some of our projects. This will not affect our long-term business objectives.’
Speaking to the AJ, Nakheel managing director Marwan Al Qamzi said: ‘The unique projects will continue... the population is growing and there will be demand. We don’t design our projects to remain for now they will remain for the future.’
Engineering consultancy Ramboll Whitbybird has also frozen recruitment and admits it may ‘consolidate’ staff in Dubai next year.
Director Peyman Mohajer said: ‘It’s possible that in 2009 expansion will be curtailed and we’ll have to think about consolidation and making sure we have the right people in the right places.
‘The bigger semi-government developers are suffering on a large scale,’ added Mohajer. ‘We’ve had a few projects stopped, but it’s something we can manage, because we were under-resourced. It’s given us breathing space.’
Meanwhile, in the wake of the redundancies, the region’s largest bank, Emirates NBD, halted all lending to expatriates employed by Dubai development and real-estate companies, including those working for top developers such as Nakheel, Tamweel, Damac and Dubai Properties, for fear of more job cuts.