UAE, DUBAI - Real Estate & Construction
President/CEO, China State Construction (Middle East)
Yu Tao has over 20 years of experience in the management of corporate affairs and construction projects. He is the Chairman of ASSAS, a special purpose vehicle between China State Construction Engineering Corporation CSCEC (Middle East) and SKAI Holdings. Under his leadership, CSCEC (Middle East) has developed a reputation as one of the leading and most respected construction companies in the region. He has led the successful diversification of the company from a conventional building contractor to a comprehensive total solutions provider. He holds a Master’s Degree in Project Management from the National University of Singapore and a Bachelor’s Degree in Civil Engineering from the Chongqing Civil Engineering Institute in China.
Around 10 years ago we came to Dubai for the Palm Jumeirah, Villas-Garden Homes project. I still remember that when I looked at the master plan of Palm Jumeirah I felt it was like a dream, which really attracted me. By 2007 we had finished 65% villas on the Palm Jumeirah successfully. From there, we started to take large and more complex orders like Sheikh Khalifa Specialist Hospital and the Doha Tower in Qatar, which is considered one of the highest-quality construction projects in the world as the winning project of Best Tall Building Worldwide. And we are also delighted to see our involvement in Abu Dhabi New Airport Project as main contractor in the infrastructure and specialist in the steel structure and mechanical package. So far, we have completed over $4.3 billion in projects across the region and involved in the Viceroy Hotel project, which is our first instance as a developer in the region.
First of all, our focus is on investment opportunities as the competition is less intense and less risky if we make the right choices. Secondly, we focus on the infrastructure sector such as major highways, railways, and airport projects in the region. Particularly, we have been actively participating in GCC railway projects and major airport projects such as in Abu Dhabi and Kuwait. Hopefully we are able to participate in Dubai’s Al Maktoum Airport as well. We believe that as China State Construction, with its proven track record of 40 airports around the world, we have a better chance to ensure the quality and timely handing of megaprojects. Especially after 10 years in the Middle East, we have a better understanding and the financial capability to contribute and help the government build first-class infrastructure.
It’s certainly a milestone. For our company, it is a transition to start investing in the Middle East, although it is nothing new to us as China State Construction, one of the biggest development and investment companies in the Chinese market. To further diversify our business, it is important to shift our focus more toward development and investment. We take the Viceroy Hotel as the first step and we believe in the partnership with SKAI Holding, where we are managing the development smoothly with great trust and synergy. We are very confident that we are going to deliver the project ahead of schedule and certainly continue the same business model.
The combination and synergy of this joint venture produced very good results. First of all, we are able to fully control the whole supply chain from design development, marketing and sales, project finance, construction, as well as maintenance. We followed through the whole processes with our partner, which generates confidence in the market. Second, to any buyers, they are not just looking at our great combination of local and international experience, but also the financial strengths that we are able to add during development to ensure projects are not affected by any potential financial turmoil. In any development, timely delivery is always a challenge; however, this is something that we are always very confident about. I think this kind of model will bring us more deals in the region.
The Expo 2020 will definitely provide contractors with more opportunities. The government will increase its budget to further complete and improve infrastructure. Compared with the neighboring countries in the GCC, Dubai probably has the best infrastructure. Nevertheless, the population is increasing rapidly. Rapid population growth has created pressure on the existing infrastructure. With the Expo 2020 attracting tens of millions of visitors, infrastructure will become extremely crucial to Dubai. We have noticed that the authorities are also building more theme parks and other leisure facilities. Of course, Expo 2020 itself is a project similar to one we experienced in Shanghai at Expo 2010, where we have built dozen of pavilions for various countries. Also, we believe Expo 2020 will bring positive to the image of Dubai and bring more business opportunities in the hospitality sector. I believe that the tourism and hospitality sectors will be booming in the coming years. With so many interesting destinations, visitors will be coming here more often. Today, Dubai has become a metropolis where people find all kinds of reasons such as business, holidays, shopping, and more to pay a visit. It is clear that visitors tend to stay longer here and spend more. Certainly, Expo 2020 will reinforce our confidence in the hospitality sector.
We will all feel the effect of falling crude oil prices. Concern over its impact on the UAE will always be there, as it is one of the major oil-supplying countries. However, I don’t think it will have a major impact on the country’s spending. Dubai has not depended on oil for many years. After it further improves its infrastructure and assumes new projects to be built, we will see the market grow. The property market was really booming in 2013 and made Dubai one of the world leading property markets. However, it has stabilized in 2014, which I read as a positive message for long-term, sustainable growth. Consolidation is always required if prices increase too quickly. Generally, it is good to see that Dubai is recovering from the last financial crisis and coming back on the right track. In the coming one to two years, we should see something more positive, especially with the improvement of the business environment in Iran, which I believe will probably bring in more business opportunities to the UAE.
© The Business Year – January 2015
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