Tonight:
4°c
What a difference a year makes. Back in April 2008, Dubai's mega-developer Nakheel boldly declared its intention to scoop up most of the region's shopaholics. The press release still screams out that ambition from the company's swanky website: "TO BECOME THE LARGEST SHOPPING MALL DEVELOPER IN THE MIDDLE EAST BY 2011". By 2018, it would be one of the biggest in the world.
Fast-forward 12 months and it's a very different story. In recent days, Korean contractor Samsung C&T said Nakheel had cancelled a $1 billion contract to build a mall. And it's not the first such project Nakheel has pulled: it's also suspended one with Australian contractor Leighton to build a Donald Trump tower on Palm Jumeirah island.
Predictably, there's no mention of these cancellations on the website, although a company spokesperson did address the retail downturn late last month, saying the company would "adjust our short-term business plans to accommodate the current global environment".
Nakheel has already laid off 15% of its workforce, and halted work on flagship projects such as Palm Deira, a bigger version of Palm Jumeirah that would have been the size of Manhattan. Plans to build the world's tallest tower, stretching a kilometre into the sky, were shelved within weeks of going public. With the yield on Nakheel bonds hovering around 40%, they're unlikely to be resurrected any time soon.
It's not all bad news for Nakheel. In recent weeks I've watched Cirque du Soleil at an existing Nakheel mall, splashed in the water park at Atlantis on the Palm Jumeirah and enjoyed dinner with my sister-in-law at her Nakheel apartment. All were top-notch. The irony for companies such as Nakheel is that if they'd focused on being the best, rather than the biggest, they'd probably have succeeded.
* As if the global economy wasn't doing enough damage to Dubai's tourism industry, Mother Nature has joined the fight. Officials were forced to shut two beaches this week, as a so-called "red tide" of algae was spotted off the coast.
* Cabin crew at Emirates Airline can look forward to an extended stint as passengers, rather than serving drinks up and down the aisles. The airline has offered them all six months' unpaid leave, as the economic downturn hits traffic and profitability.
