ABU DHABI // Property developers in Ajman are planning to acquire their own power generators in case the Government fails to meet the emirate's energy needs. The emirate is expected to change dramatically in the coming decade. More than 20 major developments are in the works, including Ajman One, a Dh3.2 billion (US$871 million) mixed project to be built on an artificial island about a kilometre from Coral Beach. It will include apartment blocks, villas and a five-star hotel.
But the lack of adequate power supplies is an ongoing concern for investors in the growing property market. Federal power authorities have said the developments are outpacing investment in infrastructure. The fear is that construction will be held up in the same way as it was with the Dh30bn Al Salam City development in Umm al Qaiwain. That projects developer, Tameer, blamed the emirate's lack of adequate power and water for the delay.
Naser Saleh, the marketing manager for the Bonyan Group, said it would supply generators for its Eye of Ajman project, which is valued at Dh3.5bn and includes 109 freehold plots of land. "The Government is working extensively to provide enough infrastructure, but just in case that falls short, we are giving our buyers an alternative," Mr Saleh said. The assurance has been popular with investors aiming to get in early. About 80 per cent of the Goldcrest Smart Towers - more than 3,000 flats - in Eye of Ajman have been sold.
Syed Abedi, Goldcrest's marketing manager, said the Smart Towers were especially vulnerable to a lack of adequate power. Their main draw is a home automation system by LG Electronics that lets homeowners control everything from their refrigerator to lighting and air conditioning from a central console. "We are very positive that all of the things will be taken care of, but if nothing works out, [the Bonyan Group] are going to provide generators," Mr Abedi said.
Other developers that are preparing to acquire their own generators include Sweet Homes Real Estate, which is building several large-scale developments in Ajman, and High Sky Properties, which is building the 1,160-unit Triple Towers. The Ajman Government considers power a critical issue. Earlier this month it signed a US$2bn (Dh7.34bn) deal with MMC, a Malaysian power producer, to build the Gulf's first coal-powered electricity plant. The plant would begin producing one gigawatt of electricity in early 2012.
"The project's aim is to provide enough electricity to property projects planned for the emirate in the near future," said Rami Dabbas, the chief executive of Aqaar Properties. He added that the Federal National Council had recently granted approval to private companies to provide power generators and produce desalinated water under the supervision of the Federal Electricity and Water Authority (FEWA).
FEWA officials have voiced concerns about the infrastructure challenges facing the northern emirates. Hassan Abdullah al Ghasyah, the authority's executive director of supply, said in a recent interview that the governments of the region were launching projects without verifying with FEWA whether there were enough resources to support them. "Local government authorities have not co-ordinated on precise water and power requirement with FEWA," he said.
A typical generator and enough fuel for a building would cost tens of thousands of dollars a month - creating a new market that has already drawn the attention of the region's suppliers. "We are looking at opening a branch in Ajman," said Jad Jubaili, marketing coordinator for Jubaili Bros, a generator supplier in Dubai. "We know there is going to be demand there with all the outages and new projects."
* With reporting from Angela Giuffrida @Email:bhope@thenational.ae