Carillion backs off major Dubai scheme to let another contractor do it

In an unusual move, UK construction major Carillion announced yesterday that its Middle Eastern joint venture, Al Futtaim Carillion (AFC), will back off from a $333m project in Dubai because another contractor is better placed to do the work.

On 25 February AFC was named preferred bidder for a mixed-use scheme on the Dubai Creek waterfront by developer Meraas, a Dubai-based holding company.

But AFC said the project had become "highly-dependent" on an associated major marine works contract so it agreed with Meraas not to proceed, and the waterfront development will now be delivered by the marine works contractor.

Carillion said the risks were better managed by one contractor.

The project consists of food, beverage and other retail buildings, underground and multi-storey car parks, three hotels, a mosque, museums, traditional workshops and a market.

A second major Dubai project AFC won from Meraas on 25 February, the $230m ‘La Mer’ development at Jumeirah, will still go ahead as planned, Carillion said.

This project involves building a mixture of top-end retail and public-facility buildings, together with substantial external landscaping to create more than a kilometre of beach-themed frontage. 


"While AFC is naturally disappointed not to be delivering the waterfront development for Meraas," said Carillion chief executive Richard Howson, "given the risks involved due to the growing dependence of this development on an associated marine works contract, it makes sense for these risks to be borne by, and under the control of, one contractor."

Carillion said AFC will continue delivering other major projects for Meraas, which Carillion said has a substantial pipeline of tourism, residential and retail projects in Dubai.

Image: Dubai, United Arab Emirates (Jahak/Wikimedia Commons)

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