Preparing to Enter the Infrastructure Design Market in the UAE
Discover the world of construction through our expert insights
Preparing to Enter the Infrastructure Design Market in the UAE: Insights by Shobin Arora

Preparing to Enter the Infrastructure Design Market in the UAE: Insights by Shobin Arora

Published 14 Jun 2024
In this article, we dive into the most important points of the infrastructure design market in the UAE, its trends and challenges with Shobin Arora, the Deputy Regional Manager at DMT Group. Managing large-scale projects exceeding $300 million, Shobin has been instrumental in executing major infrastructure and mining engineering ventures.

Shobin Arora has a proven track record in such firms as Parsons Corporation and Neste Jacobs, excelling in business leadership, market adaptation, relationship building, operations management, and revenue growth. Shobin's expertise in business management and market analysis positions him as a key thought leader in navigating the evolving infrastructure market trends and challenges in the UAE.

General Overview of the Infrastructure Design Market

Over the past decade, the UAE’s infrastructure design market has experienced considerable growth and transformation, expanding from $11 billion in 2012 to $19 billion in 2022. Initially concentrated on conventional projects, the focus has notably shifted towards sustainability and reducing environmental impact, aligning with global trends towards modernization and smart infrastructure.

The demand for advanced infrastructure has been propelled by urbanization, tourism, and economic diversification, fueling significant investments in large-scale projects such as biometric system expansion and various renewable energy initiatives. One of such important projects is the Abu Dhabi airport. This strategic pivot reflects a broader shift towards sustainable development and technological integration in the infrastructure sector.

Key Trends at the Moment

The primary trends driving infrastructure development in the UAE are sustainability and smart infrastructure, reinforced by robust government initiatives.
Sustainability. Integrating sustainable practices is a priority at all levels of project development, from design to master planning. This practice encompasses green building certifications, renewable energy, water conservation, and rainwater harvesting, with the UAE government actively leading these efforts. Such practices are considered from the early stages of project planning, ensuring a deep-rooted commitment to environmental stewardship across Dubai, Abu Dhabi, and other emirates.
Smart Infrastructure. The UAE is a prevalent user of advanced technologies like Building Information Modeling (BIM), Artificial Intelligence (AI), and the Internet of Things (IoT), which significantly enhance project delivery and operational efficiencies. These technologies are integral to DMT Group's approach as well. BIM facilitates predictive maintenance, enables comprehensive project visualization, clash detection, and accurate cost estimation. IoT sensors are used for real-time monitoring, optimizing maintenance schedules and reducing energy consumption. The UAE’s openness to new technologies has enabled the smooth integration of these tools into the infrastructure design and construction processes resulting in enhanced efficiency and smooth project delivery.
Public-Private Partnerships (PPPs). The funding landscape in the UAE has diversified, with increased reliance on PPP models and private sector investment. Economic diversification strategies have encouraged alternative funding mechanisms to support infrastructure growth.
Government Initiatives. The UAE government’s initiatives play a pivotal role in shaping infrastructure development. Agencies like the Dubai Electricity and Water Authority (DEWA) are leveraging AI and data analytics to optimize energy use and service delivery, provide residents with monthly data on their carbon footprints, and encourage sustainable energy consumption. As an extra initiative, DEWA implemented the Mohammed Bin Rashid Al Maktoum Solar Park project, known as the largest single-site solar park in the world and based on the Independent Power Producer (IPP) model. The Solar Park aligns with Dubai's Clean Energy Strategy 2050 and Net Zero Carbon Emissions Strategy 2050, aiming to achieve 100% of its energy production from clean sources by 2050.[?]
Mohammed bin Rashid Al Maktoum Solar Park
Source: DEWA

Top 3 Challenges of Infrastructure Projects

While technology, digital transformation, and sustainability are increasingly integrated into infrastructure projects, executing these initiatives and deriving maximum benefits remain significant challenges.

1. Urbanization Pressure

One of the important challenges of infrastructure projects is the pressure of rapid urbanization. Introducing policies like golden and investor visas has accelerated population growth, attracting many expatriates and investors to the UAE, which is recognized for its safety and stability.

This influx has heightened expectations for urban development, compelling the UAE to prepare for substantial urbanization pressure. Developers are actively working on numerous projects to utilize available land. Notably, the crown prince of Dubai recently initiated AED 200 billion sewage and stormwater management project, reflecting the scale and ambition of current developments.

Incorporating sustainability into these projects’ planning and design phases is relatively straightforward. But how can we ensure that these practices are adhered to throughout construction? How should we integrate those technologies? Is it even cost effective to integrate them? These are more complex questions.

2. Skilled Labor Shortage

The UAE faces skilled labor shortages, particularly as many qualified workers move to other regions like KSA. This matter requires attention to keep the project moving forward.

Compensation is a crucial factor in attracting and retaining top talent. Of course, the UAE’s advanced state of development already makes it an appealing place to work. But it’s not enough. Although all companies have financial constraints and budgets, providing attractive compensation packages is essential. And we also need to offer our engineers and laborers challenging projects that help develop their skills and experience.
Case by DMT. At DMT, we have a robust learning and development program that forms part of our compensation package. We provide opportunities for our employees to train in Germany with our mother company, a leading testing, development, and research firm. This chance to work with our German counterparts annually is an attractive proposition for potential talent.
Moreover, many international companies are opening design centers in Asia, particularly India, due to lower labor costs. This strategy helps them maintain workforce levels and optimize resource management and project delivery. This approach also aids to mitigate the challenges posed by labor and talent shortages.

3. Project Management of Scope and Costs

The biggest challenge in project management, especially in the UAE, is scope management. UAE projects are dynamic, with many stakeholders involved, leading to scope expansion from the initial plans.

Schedule management is essential. We must ensure that all project milestones are delivered on time, which requires optimal resource allocation. At the project’s outset, you must establish a baseline schedule that accounts for all risks, known and unknown.

Cost is another significant challenge. During the bidding process, it’s common for companies to quote low to secure projects. Although widespread, this practice can lead to issues as project managers might later try to cover cost discrepancies through scope variations. The practice often results in dismay among all parties involved, including clients, developers, and contractors.

During project initiation, it’s vital to invest time in clarifying the scope, schedule and costs to mitigate challenges. While it is difficult to have a complete picture at the initiation stage due to various unknown factors, considering all these elements early on is a must. This approach helps maintain the initial cost estimation and ensures adherence to the client’s budget, keeping the project on track and within financial boundaries.
Stay effective amid the construction industry challenges with First Bit

Future Outlook for the Infrastructure Design Market

Even More Urbanization Pressure

The UAE is a dynamic country that continuously evolves and adapts over time. It consistently leads to development and urbanization. Even the vision of UAE leaders is forward-looking, as exemplified by the Dubai 2040 project, which aims to transform Dubai into a 20-minute city. This concept envisions a city where everything is accessible within 20 minutes, whether by walking, driving, or other means of transport.

However, this progress comes with its challenges. One of them is the already mentioned urbanization pressure. Moreover, the UAE is expected to see a significant population influx, and we must be prepared for this.
Dubai 2040 Urban Master Plan

Climate Change Mitigation

Climate change presents a significant challenge, particularly evident in the recent rainfall patterns. To combat this, we require robust stormwater and sewer management systems. Accordingly, securing funding for these projects is essential, and both the Dubai and UAE governments are actively addressing this need.

Constant Learning Call

Technological disruptions are frequent, with innovations emerging every month. We must stay informed and understand how to apply these technologies effectively. Especially over the past decade, technological advancement has soared to new heights.

During the early stages of my career in 2012, there was limited discussion of BIM or the IoT. We relied heavily on servers and sophisticated software for analysis, design, and document management. However, the technological landscape has dramatically transformed in the last ten years. Now, software solutions can aid in the design of an entire bridge from inception to detailed design, complete with reinforcement details, and produce a 3D model as output.
We have transformed our projects by introducing BIM at DMT Middle East. This technology reduces errors, enhances collaboration, and facilitates precise coordination among various stakeholders, such as on the Dubai Metro expansion project. It has streamlined construction processes, optimized resource allocation, and was even implemented for various Expo 2020 arena projects. With BIM, you can integrate time and cost factors, allowing you to see the entire construction schedule and check the actual progress against the planned progress within a BIM environment.
The challenge here is that we need individuals who are well-versed in these technologies and capable of harnessing them to their fullest potential.

Investment Flow

As there are significant opportunities in the realm of sustainable infrastructure, large investments in renewable energy are expected to come into play in this part of the world. With over 300 sunny days a year, solar energy has the potential to be a game-changer in the region.

Digital transformations are also crucial. Technologies like Scan to BIM and other software and artificial intelligence are vital for streamlining projects and optimizing processes. Therefore, forming strategic partnerships is essential to harnessing these advancements and effectively driving innovation and development.

International Businesses in the UAE as a Trend

International businesses have established themselves in the UAE for over three decades. However, with recent opportunities and , the UAE has become an increasingly attractive location for setting up businesses. It offers ample opportunities for businesses to expand, grow, and profit.

Every new project, especially mega projects like the Museum of the Future and the expansion of the Dubai Metro with the introduction of the Blue Line, highlights this trend. There’s a clear pattern of new international businesses coming in and leveraging the regional location, urbanization, and opportunities the UAE provides.

Main Things to Сonsider When Entering the UAE Market

1. Local Regulations and Business Practices

Local regulations and business practices are the most crucial aspects to consider when entering the UAE market. These practices include understanding licensing requirements, labor laws, and local construction standards.

A common strategy among international businesses that have successfully entered the UAE is to hire locally available talent. Local professionals are usually well-versed in these regulations and practices, which are vital for successful market integration.

2. Cultural Differences

The UAE is a melting pot of cultures, with Emiratis, Egyptians, Indians, Australians, Spaniards, Italians, Eastern Europeans and other nationalities living and working in harmony. Sometimes it can lead to cultural misunderstandings, particularly in communication styles, business etiquette, and decision-making processes. For instance, as someone from India, my decision-making process may differ significantly from someone from the US or Europe. You just need to pay more attention to embracing an expanded horizon and enhancing cultural sensitivity.
Cross-cultural training and fostering a diverse and inclusive work environment are effective strategies to address this. Exposure to different cultures, even in informal settings, can be incredibly beneficial. From my experience, usually resolving cultural misunderstandings comes down to mutual communication, helping each party understand where the other is coming from.
Hiring local talent is often used to navigate these cultural complexities effectively. But companies should also include cultural training as part of their onboarding process to educate new employees from other nations about the UAE’s diverse cultural landscape. Promoting cultural awareness and fostering an inclusive environment is something I personally admire about the UAE and is something companies should actively promote.

3. Networking and Partnerships

In forming partnerships in the UAE, international companies should engage local expertise with existing relationships with strategic partners who can provide valuable market insights. This approach helps access local networks and foster strategic alliances. International companies in the UAE should seek partnerships based on shared values, especially with those who appreciate and provide quality products, as this aligns with customer expectations.

Such strategic partnerships may take time to develop but are advantageous in the long term. They leverage local expertise, enhance project outcomes, and offer mutual benefits, including profit sharing and commercial growth for both international companies and their local partners.

4. Customization of Services

It’s important for international companies to customize their service offerings and adapt their business models to align with the local preferences and the market needs. For instance, consultants in Europe or America face different market needs compared to those in the UAE. A clear example is in the design guidelines for buildings or infrastructure. In the UAE, specifications are tailored to its climate, geography, and the need for long-term sustainable solutions. Comparatively, Europe, being a colder and wetter region, does not require the same design guidelines that the UAE needs.

Customization can be also required at a higher level, which means not only adjusting guidelines but entering new sectors and developing absolutely new services.
For example, DMT Germany specializes in research, testing, and mining services, but in the UAE, where mining opportunities are limited, we had to shift our focus. We adapted our services to infrastructure and developed a robust BIM and infrastructure team. Additionally, we customized our project management methodologies, incorporating lean construction and agile principles to optimize project timelines and budgets, enhancing stakeholder engagement and risk management.
The UAE construction industry offers promising opportunities for international businesses:
The renewable energy sector is anticipated to experience significant growth.
Developing smart cities is a primary focus, especially with projects like Dubai’s 2040 Vision and similar initiatives in Abu Dhabi.
As for niche service areas, infrastructure asset management has a lot of potential. While numerous operation and maintenance companies exist, few specialize in managing infrastructure assets.
Other important sectors include smart transportation, intelligent traffic systems, and healthcare infrastructure.
All these areas will likely experience significant growth and offer valuable opportunities for international firms entering the UAE market.
Get all the aspects of your project under control with FirstBit ERP

Best Practices to Embrace for International Companies in the UAE

To summarize, here is a concise list of best practices for international companies entering the UAE infrastructure market:
Understand market dynamics. Gain a deep understanding of the local market conditions and preferences to align your offerings effectively.
Tailor services. Customize your services to meet the specific demands and expectations of the UAE market.
Identify niche opportunities. Look for specialized areas within the market that may be underserved or offer unique advantages.
Establish strategic partnerships. Form alliances with local entities that can help navigate the complexities of the UAE market.
Adopt a long-term perspective. Focus on sustainable growth strategies rather than short-term profit maximization.
Stay adaptable. Be prepared to quickly adjust your business strategies in response to changes in market conditions to leverage emerging trends and opportunities.
These practices help companies navigate the UAE’s unique challenges and opportunities, ensuring they adopt strategies that promote long-term success and alignment with local business norms and regulations.
Deputy Regional Manager at DMT Group
Managing large-scale projects exceeding $300 million, Shobin has been instrumental in executing major infrastructure and mining engineering ventures. He has a proven track record in such firms as Parsons Corporation and Neste Jacobs, excelling in business leadership, market adaptation, relationship building, operations management, and revenue growth.
Share this post
Learn how to take control
of your processes and scale your business with FirstBit ERP now!
Contact us to get a free consultation and quotation for your business.
First Name
Phone number
By clicking this button, you agree to our Privacy Notice and Terms of Service.
Request a demo
Thank you!
A First Bit expert will contact you shortly to schedule your demo.
Something went wrong.
Try onу more time or reload the page.
Related articles