Aldar Diversifies Beyond Property Development in UAE Amid Economic Resilience Push

The UAE is intensifying efforts to bolster economic resilience by strengthening supply chains, increasing local production, and attracting investment. This strategic shift is occurring as businesses and policymakers adapt to evolving global conditions.

Aldar's Diversification Strategy

Talal Al Dhiyebi, Group Chief Executive Officer of Aldar Properties, highlighted the UAE's continued appeal to international investors despite geopolitical uncertainties. He emphasised the importance of business diversification for sustainable income generation. Aldar, traditionally known for residential development, has expanded into asset management and other income-generating sectors including logistics, private credit, commercial offices, retail, and hospitality. The company has also pursued international expansion, establishing platforms in London and Egypt.

This diversified model allows Aldar to serve a wide range of customers across various sectors, providing comprehensive solutions from accommodation for office tenants' employees to retail, hotel, and logistics facilities. At the end of June, Aldar's development sales backlog reached AED 71.6 billion, ensuring revenue visibility for the next two to three years. The company reported an 18% increase in first-half net profit to AED 4.9 billion, despite a cautious approach to new project launches. Development sales in the UAE saw a 61% year-on-year decrease in Q2, though sales activity began to rebound in April with new launches in Abu Dhabi and planned projects in Dubai. Al Dhiyebi also noted a 10% increase in student numbers across Aldar’s education network this year, reaching nearly 40,000 students, indicating sustained demand from families.

UAE's Economic Priorities Shift

Abdulla bin Touq Al Marri, UAE Minister of Economy and Tourism, stated that the changing global environment has led the UAE to rethink its economic priorities, focusing more on supply security, domestic production, and resilience.

"The war has changed the economy. It is not going to be the same."

The minister outlined five key economic clusters the UAE is developing to ensure reliable access to essential products and maintain supplies during future disruptions:

• Food and food processing
• Space and defense
• Tourism
• Financial services
• Data-related industries

The strategy aims to integrate businesses and use the complementary strengths of different emirates. For instance, the food and food processing sector demonstrated coordination during recent disruptions, with 18 factories collaborating daily to ensure food supply. Given that the UAE imports over 90% of its food, local production and agricultural investment are crucial long-term strategies. The government is encouraging investment in agriculture and food processing, with a Cabinet-approved policy to feature locally produced goods prominently in supermarkets. On pricing, the focus remains on fair and transparent practices, balancing consumer affordability with trader costs.