The new Dubai developer that unveiled a $US95 billion ($A147.29 billion) real estate project just two months ago said Wednesday it is reviewing its plans - the latest sign that the souring economy is dampening this brash boomtown's ambitions.
The retreat comes as a widely watched report showed property price growth in the fast-growing Gulf city-state slowed considerably in the three months through September, ahead of an expected decline later this year.
In reassessing its development plans, Meraas Development said in an emailed statement it has "seen that investor demands have changed" and that it must "quickly respond to meet these market needs."
The developer, launched by the government of Dubai in late September, said it is re-examining its business strategy and the rollout of its flagship Jumeira Gardens project slated for a central part of city.
"In a worldwide economic downturn, any corporate must analyse the market and ensure its business strategy is aligned to make the most of new opportunities, as well as ensure risk management strategies take account of the new financial landscape with a focus on new market and investor demands," the company said.
Meraas announced the 350 billion dirham ($US95.3 billion ($A147.75 billion)) Jumeira Gardens at a property expo in October. The company said at the time that work had already begun on the development, which was advertised as a "city within a city" that would include one of the world's tallest buildings and take 12 years to complete.
Meraas said it expects to have more details on the project by the beginning of 2009.
The developer is a division of Meraas Holding, whose private equity division, Meraas Capital LLC, joined real estate investment trust Boston Properties Inc and other investors in acquiring the General Motors Building in New York City for about $US2.8 billion ($A4.34 billion) in June.
The company is not the only Dubai developer reworking its plans.
State-owned builder Nakheel told The Associated Press earlier this week that it cut 15 per cent of its staff and is scaling back work on some of its ambitious island-building projects off the city's coast. Other projects being delayed include a luxury hotel being built with Donald Trump.
Separately on Wednesday, real estate consultancy Colliers International said its index of Dubai home prices grew 5 per cent year-over-year from July to September - down from 43 per cent in the first quarter and 16 per cent in the second quarter.
Ian Albert, regional director for consultancy services at Colliers, said he expects the next round of figures would show a decline in the last three months of the year in large part because of the liquidity squeeze caused by the global financial crisis.
"It is clear to us that the landscape has changed since the end of September," he said.
Last month, a HSBC Holdings PLC report found home prices on Dubai's secondary market fell month to month for the first time since the emirate began allowing foreigners to buy property in 2002.
