Arabtec Holding PJSC (ARTC)’s construction unit won a 1.04 billion-dirham ($282 million) contract from Emaar Properties PJSC (EMAAR) to build townhouses in Dubai as the company benefits from a rebounding real-estate market.
/ Source: Bloomberg
Arabtec will build 1,582 properties at Emaar’s Mira community, the first phase of Reem development located near Arabian Ranches, the company said in a statement. Construction on the villa community, designed by BH.NS Engineering Consultant, is expected to start this quarter.
“This project adds further momentum to an already strong start of the year,” Arabtec Chief Executive Officer Hasan Abdullah Ismaik said in the statement. “The volume of contract wins we have bagged so far promises to take our backlog to unprecedented heights.”
Contracting firms are benefiting from a resurgence in the U.A.E.’s real-estate market. Prices for mid-range apartments in Dubai rose 43 percent in 2013, according to Cluttons LLC data on Bloomberg, after values more than halved following the global financial crisis in 2008. Full-year profit at Arabtec will more than double to 320 million dirhams in 2013, according to the mean estimate of 10 analysts on Bloomberg.
Arabtec last month won a 22.4 billion-dirham contract from Aabar Properties to build 37 towers in Abu Dhabi and Dubai and is expanding its operations to the Balkans with the opening of a regional headquarters in Belgrade, Serbia. The company, which is planning to sell shares in six of its units starting next year, also won a 1 billion-dirham contract in Kazakhstan.
Arabtec has a joint venture with Samsung Engineering Co. that plans to provide engineering, procurement and construction services on “large-scale multi-billion” projects in the oil, gas, power and related infrastructure industries in Middle East and North Africa. The company also has a venture with GS Engineering & Construction Corp.
Arabtec helped build a number of Emaar’s projects, including Burj Khalifa, the world’s tallest tower, Emirates Hills and the Address Downtown Dubai. The shares have surged 65 percent this year after gaining 54 percent in 2013.