Property owners in the Middle East should share the financial risk of new developments and form partnerships with developers, according to experts.
To cope with the increasing time pressures on developments in the Middle East, Samer Abu Ayash, vice-president of design and construction for Kingdom Hotel Investments called on owners and developers to share the risks of new projects.
Ayash said: “We are under more and more pressure to deliver rooms. Sometimes we are so desperate to find a contractor we have to forgo the tendering phase and go for a partnership right from the start.”
He added: “We don’t have the luxury of time here and limited operator involvement is a recipe for disaster”
Robert Lee, director of development for property developer Nakheel, added: “Businesses have to accept risk and manage it, otherwise projects will never get built. However, behind the magic of these projects there needs to be a hard logic, a sense of purpose and an exit strategy.”
Philip Jones vice-president of architects HOK International warned that developers and operators need to take a long-term view.
“You are building an asset. As the area develops, the asset will be traded – if it isn’t built property, it’s not something other investors will want later on,” he said.
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By Emily Manson
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