Family-owned Dubai conglomerate al-Habtoor Group said on Monday that it was launching a $3 billion real estate development in the emirate that would include 3,000 hotel and residential units as well as a water-themed theater.
The group, whose operations span the hospitality, construction, education and automotive sectors, said it expected about 20,000 people would visit al-Habtoor City every day.
Chairman Khalaf al-Habtoor told reporters that the group would use its own resources to finance the project, which would be completed by 2016.
“We are capable of financing this. But if banks are interested, then we are happy to talk to them”
Developers in Dubai are back to announcing mega-projects as the emirate recovers from its 2009-2010 debt crisis. Dubai firms have announced projects worth nearly $40 billion in the first half of 2013, according to some estimates by local media, including plans to construct the world's largest Ferris Wheel and billion-dollar theme parks.
The Habtoor development would run alongside Dubai's newly announced canal; the emirate's government said last week that it would spend $545 million on building a canal through its downtown area.
The return of a bullish mood to the real estate market has caused home prices in the emirate to surge over 22 percent in the past year, consultants Jones Lang LaSalle said in a report last week, raising concerns about an overheating of the market.
Al-Habtoor, which has a stake in a joint-venture construction firm with Australia's Leighton Group, shelved plans to raise as much as $1.6 billion in an initial public offer of shares last year.
The chairman said on Monday that the company had no intention of reviving the IPO plan this year.
Its new development will have three residential tower blocks incorporating 1,460 luxury apartments, and three hotels to be operated by Starwood Hotels & Resorts, he said. It will have 11 penthouses including two VIP penthouses with private garden terraces, a swimming pool and a Jacuzzi.
“We don't have plans to sell the VIP penthouses, but if we did put them on the market, we would not sell them for less than $250 million each,” Khalaf al-Habtoor said in a press statement.
The water-based theatre will bring “a touch of Las Vegas to Dubai,” the statement added.
The chairman dismissed talk of another property bubble developing in Dubai.
“We can't control speculators. The government can't do much about gamblers,” he said.