Sharjah benefits from public works and strong demand for residential real estate

As the third-largest of the seven emirates that make up the UAE, Sharjah has a large population and a strategic location for regional connectivity, as well as significant real estate activity, all of which contribute towards an expanding construction sector. The emirate has several major real estate developments under construction, many of which are mixed-use developments that could help to radically transform the landscape in the emirate (see analysis). The opportunities available in Sharjah nowadays mean that many more companies from the rest of the UAE, and other GCC countries, are looking to get involved in the near future, further opening the emirate to outside investments.

Governmental Players

Several governmental agencies are involved in the planning and urban development of Sharjah, notably the Sharjah Department of Public Works, Sharjah Urban Planning Council (SUPC), Sharjah Electricity and Water Authority (SEWA) and the Sharjah Real Estate Department. All of these operate under the umbrella of the Sharjah Economic Council, and ultimately Sheikh Sultan bin Mohammed Al Qasimi, the ruler of Sharjah. Meanwhile, Sharjah Investment and Development Authority (Shurooq) is one of the driving forces behind the physical development of Sharjah. Chaired by Sheikha Bodour bint Sultan Al Qasimi, the independent government body evaluates and helps to facilitate and actively develop tourism, investment and heritage-related infrastructure projects.

Also active in the sector is Sharjah Asset Management, an official investment arm of the Sharjah government, which provides strategic investments with a focus on high-end projects that will add value to Sharjah’s overall economic activity.

Sector Spending

According to MEED Projects, there are at present more than $6.5bn worth of construction projects planned or currently under way in the five northern emirates – Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah (RAK) and Fujairah – with an additional $1.8bn worth of projects being developed in the hospitality sector.

Sharjah continues to push strongly for the development of its real estate sector, with continued investment in the sector among the key drivers of the emirate’s long-term economic prospects. Real estate plays a key part of the emirate’s economy, with real estate and business services accounting for a combined 21% of economic activity, according to some estimates. At the same time, the industrial sector, which currently makes up more than 14% of the emirate’s GDP, is expected to grow to 25% of GDP by 2025, according to Mariam Al Suwaidi, deputy director of industrial affairs section at Sharjah Economic Development Department, through the expansion of innovative industries. This has necessitated spending on infrastructure to help these innovative industries grow and thrive.

Public Works

In 2017 Sharjah approved its largest ever budget, worth around Dh22bn ($5.4bn), roughly a third of which will be spent on infrastructure projects. In total, infrastructure spending is set to rise 7% compared to 2016, pointing to strong and targeted growth as well as plenty of opportunities for construction-related companies in the region.

In December 2015 Sharjah Department of Public Works announced that it had undertaken upwards of 700 building projects, worth over Dh3bn ($816.8m), related to health, education, housing and services. At the same time, the head of supervision at the department of building projects said that 2016 would see the start of construction of several major public works, including the Dh30m ($8.2m) Sharjah Educational Zone, the Dh60m ($16.3m) Manuscripts House at Al Qasimia University and two new mosques, costing a combined Dh41m ($11.2m).

In February 2016 the SUPC approved the designs for five new pedestrian bridges, with walkways to be located around King Faisal Road, King Abdulaziz Street, Al Ittihad Road and Al Taawun Road. “Developing projects of this kind is a top priority for the SUPC, as such structures will complement the attractive architectural landscape and the fully functional infrastructure in the emirate, and will respond to the needs and aspiration of people and communities,” Sheikh Khalid bin Sultan Al Qasimi, chairman of the SUPC, said in a public statement at the time of development.

This followed the recent completion of a Dh11.4m ($3.1m) city centre roadwork project, aimed at improving roads and congestions in the emirate, as well as a $136m new runway at Sharjah International Airport, completed in late 2014 and aimed at further improving Sharjah’s international and regional connectivity. The 4060-metre-long runway, which took two years to complete, is capable of handling the world’s largest aircrafts, including the Boeing 747-800 and Airbus A380.

Meanwhile, work on eight power stations is set to commence in 2017, according to SEWA plans, consisting of three 132-KV and five 33-KV distribution stations. SEWA plans include the construction of three 132 KV and five 33 KV distribution stations this year. These works form part of SEWA’s mandate to meet the “growing demand for electricity due to demographic, urban, economic, industrial, social and developmental expansions in the emirate”.

Electricity shortages are an issue, according to George Berbari, CEO of DC Pro Engineering. “The emirate needs about 1500 MW of power with less than 1000 MW installed, so the remainder is supplied by Abu Dhabi through a relatively recent agreement.”

In 2017 Sharjah approved its largest ever budget, worth around $5.4bn, roughly a third of which be spent on infrastructure projects REAL ESTATE: There is a strong and growing demand in Sharjah for high-end, suburban-style properties and gated communities, as well as residential apartment complexes. Indeed, the completion of the city centre roadwork project, in addition to a number of planned large-scale developments, could further encourage investors to seek out Sharjah as an alternative destination to more expensive places in neighbouring Dubai.

According to a recent survey by international property agency Cluttons, Sharjah is currently the third-most attractive property investment destination in the GCC, offering opportunities for those investing and involved in the construction sector. Of the high-net-worth investors surveyed, 8% identified Sharjah as one of their top-three destinations, behind Abu Dhabi with 21% and Dubai with 27%.

Return on investment (ROI) in Sharjah is also higher than in Dubai. According to Saeed Ghanem Al Suwaidi, managing director of Al Ghanem Real Estate, ROI is currently around 13-15%, depending on land price. “In Dubai it is only around 10-11%, if you are building your own building. Again, this is largely due to the lower cost structure in Sharjah compared to Dubai,” he told OBG, adding that in Sharjah you are able to use less high-quality materials, such as glass and aluminium, compared with Dubai “because the market is less sophisticated, more local, more middle-income.” Shane Breen, associate director at Cluttons, told OBG, “There is a lot of good money to be made in building a residential tower and by renting it out and getting 8-10% a year returns, which you can’t get in Dubai.”

There is also continued investment in public housing. According to Berbari, Sharjah’s Public Housing Authority builds around 500 units per year, “which creates significant demand for construction and construction-related services like our own. That said, there is not currently much focus on green buildings, which is a shame,” Breen told OBG.

In October 2016 it was announced that the Sharjah Labour Standards Development Authority had signed an agreement with Gistec, a geographic information system company, to conduct a survey looking at the current state of facilities and services available to workers employed in Sharjah, with the goal of enhancing the living and working environment for workers. The survey, a first of its kind in the UAE, will enable the authorities to better predict future needs when it comes to labour housing.

Major Developments

There are several major real estate developments under construction in Sharjah, chief among them the Dh20bn ($5.4bn) Sharjah Waterfront City, located on Sharjah’s northeast coast, the emirate’s largest master-planned mixed-use development project and the third-largest mixed-use project in the GCC, covering over 10 islands, 60m-sq-feet of land and 36 km of waterfront. Developed by Sharjah Oasis Real Estate Development, the project will accommodate some 200,000 people upon completion, with the islands to be connected by bridges and canals.

Also under development is the Dh2.4bn ($653.4m) Tilal City, a joint venture (JV) between Sharjah Asset Management and Eskan Real Estate Development, which is being developed by Tilal Properties. The 25m-sq-foot development is Sharjah’s first freehold and free-lease, master-planned project, and will feature 1855 plots aimed at providing high-end housing for 65,000 residents. Plots are available to buy or lease for UAE residents and GCC nationals, with non-Arab expats able to purchase land on a 100-year leasehold basis for the first time in Sharjah’s history (see analysis).

Tilal Mall

In September 2016 it was announced that construction on a 2m-sq-metre mall, Tilal Mall, which will be located in Tilal City and be the largest mall in the emirate, is expected to start in mid-2017 and be completed in 2019. The mall is expected to have a gross leasable area of 94,121 sq metres. In addition to retail space, the mall will feature a cinema and a 65-ha park with various entertainment and event spaces, pavilions, waterfalls and restaurants. “Tilal City will be a forerunner in contributing to the development of this new suburb in Sharjah, and at the centre of the development, Tilal Mall, which will play a significant role in promoting investment opportunities and will reflect its strategic potentials on a global scale, further highlighting on what Sharjah has to offer to international investors and property buyers,” Sheikh Sultan bin Ahmed Al Qasimi, chairman of Tilal Properties, said at the announcement of the mall’s development.

Tilal City is also a pioneering project when it comes to public-private partnerships (PPPs), and the project could pave the way for future real estate developments in Sharjah. “Tilal City is unique in that it is being developed as a PPP, a model which has not typically been utilised in the real estate sector in Sharjah,” Khalifa Al Shaibani, director-general of Tilal Properties, told OBG. “If the project is ultimately successful, I see opportunities for many similarly structured projects in the future.”

Meanwhile, Al Thuriah Properties has started work on Sahara Tower 6, which consists of two towers – one with 39 storeys, the other with 21 – for a total of 376 residential units. Scheduled to be completed in 2019, Tower 6 is part of the larger Sahara Complex, a master development project of over 3.1m sq feet that will include a total of 1348 apartments, located on the border with Dubai.

Another major development under construction is Al Zahia, a JV between the government and Majid Al Futtaim Properties, one of MENA’s leading diversified property companies. The project will span more than 1m sq metres and will be the first gated community in Sharjah, offering villas, townhouses and apartments. Ultimately, 12,000 people will call Al Zahia home. The project is set to be completed by 2022, and it is estimated that it will contribute Dh5.5bn ($1.5bn) towards Sharjah’s economy.

The development is also the first in the Middle East to be awarded the internationally accredited BREEAM Communities Certification, a sustainability assessment method for master-planning projects, infrastructure and buildings, which could signal a new trend in the region.


The construction boom in Sharjah is also taking place in the retail sector. In addition to Tilal Mall, City Centre Sharjah, one of the emirate’s largest shopping malls, is set to undergo a Dh260m ($70.8m) redevelopment, and will be completed in the last quarter of 2017. This project will result in hundreds of direct and indirect jobs as the mall is modernised and refreshed, with 13,700 sq metres of retail space being added. “City Centre Sharjah will complement the company’s new super-regional mall being developed in Al Zahia, as well as the expansion of City Centre Ajman – reflecting the growth opportunities that we see in the UAE’s Northern Emirates throughout the next decade,” Ghaith Shocair, CEO of shopping malls at Majid Al Futtaim, said in November 2016 when the redevelopment was announced.

In April 2016 UAE developer Alef Group signed a contract with Omis Contracting for the construction of Zero 6, a modern mall located within 5 km of Sharjah University City and Dubai International Airport, which will include 16,000 sq metres of leasable space, including 13,000 sq metres for retail. The project is set for completion in late 2017.

Despite the significant number of large-scale shopping complex developments, some believe that plenty more are required before the demand is fulfilled, pointing to many more construction opportunities. “There are currently not enough [malls] to support the massive influx of population,” Abdulla Al Shaibani, CEO of City Properties Real Estate, told OBG. “Huge swathes of former desert has been developed into residential communities, and there are no big retail developments to service them. 3000 villas need at least three to four shopping malls, so 10-30 times more retail space is needed,” he added. While this estimate of overall need may be optimistic, there is certainly room for more growth, and construction companies will be the big beneficiaries in the short term.

Hotels & Tourism Developments

Sharjah’s tourism-related infrastructure is still under development, notably high-end hotels that cater to visitors. Room rates in Sharjah are low compared to Dubai due to the fact that there are a limited amount of rooms in the higher-end category, with few five-star hotels and none currently in the pipeline, as the ROI is generally considered too low.

Indeed,more investments could be made to develop Sharjah as a tourism destination. Ras Al Khaimah, for instance, has invested heavily in developing both its beach and desert hotels, and it has become a leisure destination for foreigners, even travellers from outside of the region.

In November 2016 it was announced that Shurooq had started work on the Dh45m ($12.3m) Al Badayer Desert Camp project, which aims to become one of its main leisure and adventure destinations in the emirate when it opens in late 2017. The 24,000-sq-metre desert camp will include an open-air amphitheatre for live activities, recreational tents, shops, an urban resort, a desert lodge, restaurants and cafés. A 40-minute drive from central Sharjah, Al Badayer will give visitors to Sharjah the opportunity to get out and explore the wilderness and engage in desert-related activities.

There are other areas that could easily be developed as Sharjah was one of the first places to have beach hotels in the UAE. The hotels are not as luxurious as they once were, but they have taken up all of the available beach space and are therefore sitting on prime real estate. There is significant investment potential for these hotels to be torn down and rebuilt or redeveloped.


While there are a variety of opportunities available in the construction and real estate sector in Sharjah, for private developers, residential properties remain the main focus. “Residential is the key here, that’s why we focus on it as a developer,” George Khouzami, operations and commercial manager at Al Thuriah Group, told OBG. “We can build office towers, hotels and warehouses; there is nothing complicated about that. But residential this is where the real demand is.”

However, the market in Sharjah is still heavily tied to other areas in the region and influenced by outside pressures. Fluctuations in financing and perceived demand as well as oil prices all have an impact on housing prices. “The sector is very cyclical. In late 2012 or early 2013 it began to pick up after the financial crisis of 2008, with more tenders and more activity,” Waleed Halasa, general manager of Gulf Steel Industries, told OBG. “This lasted until early 2015 when the falling oil prices and regional instability began to take more of a toll. Right now most of the earlier projects are in hand, so people are waiting. They are more conservative.”

However, others are more optimistic about the situation and have not noticed much of a slowdown. There are still a lot of opportunities in Sharjah for construction companies and many large Dubai or Abu Dhabi-based contractors are thinking of shifting some of their operations to Sharjah because they see significant potential in the emirate as growth in the other, more established emirates begin to slow down. So, investors and construction companies are looking too counter this cool-down with projects in Sharjah. The perception that construction activity is slowing down could be overblown as a lot of large-scale projects are currently in the process of being built, such as Tilal City, for example.

Developments like the new technology park at the American University of Sharjah (AUS), announced in 2015, could also lead to opportunities. “The AUS technology zone will be a boon and will require significant amounts of construction and power needs,” DC Pro Engineering’s Berbari told OBG.

Red Tape

While Sharjah is open to outside investors and developers, the system favours those that have operated in the market before.“If you want to get something done in Sharjah, you do need to take the time to understand how the system works.” Avin Gidwani, CEO of Industry Networks, a high-tech information exchange service for the building and construction industry, told OBG. According to Gidwani, the court system in Sharjah is not always easy to understand from an English speaking expat perspective, but in our experience, the system has always proved to be both reliable and efficient.”

Health & Safety

Like in much of the region, high summer temperatures are a source of concern for those involved in the construction industry in Sharjah. In the UAE there is a mandatory summer break from 12:30pm to 3:00pm for outdoor labourers. In November 2016 it was announced that construction workers employed on the Al Zahia project would receive 1100 freezer-pack neck coolers to combat extreme summer temperatures. The pilot project, by Emerson Middle East and Africa, is aimed at improving health and safety, with the cooled gel packs engineered to last for roughly one hour in temperatures of up to 45°C. Manufactured by Freezemate in collaboration with Emerson, the gel packs have towelled exteriors, which improve their effectiveness and help to absorb excess sweat. In addition, Emerson MEA has installed a solar-powered freezer unit in order to cool the gel packs, which makes the devices carbon neutral in operation. There is a hope that this technology could help deal with the excessive summer heat, and if proved successful could be rolled out on a larger basis.

Extending Lifespans

In May 2016 it was announced that Sharjah Research Academy had signed a memorandum of understanding with the Portuguese National Laboratory for Civil Engineering related to feasibility of infrastructure in warm environments. The research will target the extension of the lifespan of building projects as well as reducing overall maintenance requirements, which also had strong potential in the region.


Sharjah’s construction sector is likely to thrive over the next few years, with large-scale public sector and private sector projects requiring huge amounts of materials, manpower and expertise. In addition to this, these new developments could then spur more demand for developments, kick-starting a major period of real estate expansion in the emirate that could last for many years to come.


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The Report: Sharjah 2017

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