Dubai is in the process of building the largest mall in the world.
The new real estate venture is part of a project to build an air-conditioned city. Dubai officials hope the projects will stimulate the economy following the 2009 debt crisis.
The 48 million square foot complex — an air-conditioned network of 100 hotels, a theme park, and theatres — will be developed by Dubai Holdings for approximately $US6.8 billion, Ahmad bin Byat, Dubai Holding’s Chief Executive, told arabianbusiness.com.
While the entire project is estimated to take a period of at least 10 years to complete, the 8 million square foot mall will be ready in approximately three years.
It’s unclear when construction will begin on the shopping mall, which is nearly four times the size of the Mall of America in Bloomington, Minnesota.
Until the “mall of the world” is complete, the world’s largest mall is the New China South Mall. The approximately 7.1 million square foot Chinese mall is located in Dongguan and notoriously void of shoppers.
Meanwhile, the IMF continues to criticises Dubai’s ambitious real estate developments in fear that overbuilding may cause another boom-bust cycle.
During Dubai’s boom years, 2006 to 2008, Dubai Holding borrowed so heavily from banks to fund growth and ended up hitting a huge real estate bubble burst leading to the cataclysmic 2009 debt crisis.
According to Byat, half of the funds to finance this project will come from ‘internal resources,’ and the rest will be collected through the debt market, sales, and revenue from leasing.
Dubai’s unprecedented luxury and extravagance along with massive retail projects are key ingredients in making this city the economic powerhouse of the Islamic world.
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