Qatar construction costs highest in GCC


Qatar is the most expensive GCC country when it comes to constructing projects, according to an annual report by EC Harris, the global built asset consultancy firm.

The ARCADIS International Construction Cost study benchmarks building costs in 43 countries and found that relative construction costs have been affected by currency fluctuations, commodity prices and increasing demand for development in many recovering economies throughout the year.

Qatar ranks as the most expensive in the region with the UAE just behind and Saudi Arabia slightly cheaper still.


Globally, Switzerland is the most expensive of those countries surveyed, followed by Denmark and Hong Kong. India is rated as the cheapest.

“Investment on social infrastructure, economic diversification investment and event-driven construction are three key trends positively influencing construction spend in the region,” said Christopher Seymour, partner and head of UAE property at EC Harris.

“UAE is a relatively small market when compared to others on the rankings and is less impacted by fluctuations in global currencies whereby market constraints are driving inflation and price movements.”

The survey said in the Gulf region, costs remain relatively modest, despite high levels of investment in transport infrastructure, such as the $200bn GCC rail network, and extensive event-led construction in the shape of Qatar’s successful World Cup bid and Dubai’s 2020 World Expo.

But analysts posed the question: “What remains to be seen is what impact the ongoing instability in the Middle East and recent weakness in oil prices will have on spending plans and, consequentially, pricing?”

Seymour said: “Whether the recent weakness in oil prices has a short or medium-term impact on construction, spending plans will become clearer in 2015.  Abu Dhabi is best placed to be able to continue to fund budget commitments, but with oil trading hovering around $50/barrel earlier this month, it is possible that current and capital spending priorities may come under review.”



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