Sheikhs, Lies and Real Estate: The Untold Story of Dubai (34 page)

‘Judgment day is coming.’ 

‘Excuse me?’

‘Allah is angry with our greed. We are close to
the end of the world.’ There was a foreboding tone behind the taxi driver’s
words that made me quite uncomfortable.

‘Why do you say that?’ I asked earnestly.

He looked at me in his rear-view mirror. ‘Sir,
there is a famous old teaching of the prophet Mohammed; may God bless him. A
man asked the Prophet, “What are the signs of the Day of Judgment?” The Prophet
replied, “When the barefooted shepherds are competing to build tall buildings.”
So you see, sir, this is now coming true. Just look around us. The end of the
world is close.’

Whether by ‘barefooted shepherds’ the prophet
had meant the Emiratis was up for debate. But it was difficult to doubt that
2009 felt like the end of the world in Dubai.

As the dust finally began to settle, the
ramshackle city that emerged was a tragic shadow of its former glory. All along
the Sheikh Zayed Road, frozen building sites, motionless cranes and unfinished
skyscrapers were a familiar sight. Skeletal shells of buildings with windows
missing and steel beams exposed looked less incomplete than obliterated, like
the remnants of a nuclear tragedy which had ripped through a once thriving
metropolis. 

The luxury hotel lobbies were empty, the
apartment blocks looked deserted and the highways were quieter than ever. As I
drove towards the Marina, I recalled the former promise of most of the hollow
structures surrounding me. Many had been launched to great fanfare and pomp,
snatching headlines across the region. Today the world’s newspapers were lamenting
their tragic demise. The vacant streets reminded me of the movie set of an
ill-fated blockbuster whose producers had pulled the plug, leaving behind an
empty, soulless back lot. 

Across the city’s
shisha
cafés, the property
market was still the hot topic of conversation. But the boasting of quick
profits and short-term flips had turned into hopeless sob stories, as many lamented
how much they had lost and how they should have known better. A blame game
ensued as investors pointed fingers at developers for delays, developers blamed
the banks for failing to honour their financing commitments and banks blamed
the unforeseen global crisis. Those who had enough faith in Dubai’s courts to
gamble on legal proceedings were in for a long and expensive haul. Developers
exploited loopholes in poorly drafted contracts that were heavily biased in
their favour to shift any liability back onto investors. Other developers faced
with litigation for not honouring their commitments simply closed up and fled.

After resigning from Milestone, I spent most of
the next two weeks in my apartment feeling sorry for myself. I stayed in my
pyjamas, I didn’t shave and I lived on toast and Pot Noodles. As I sat alone on
the balcony in deep contemplation, I couldn’t help but wallow in self-pity.
Where had it all gone wrong?

As much I tried, there was no use in trying to
rationalise events. The fact remained that my grand adventure had ended in
failure, and here I was jobless, hopeless and Porscheless. I was at the lowest point
of my life and I wanted nothing more but the ground to open and swallow me up.

After a small bite in the kitchen, I was heading
back to the sanctity of my bed when my phone rang.

‘Hello?’

‘Adam?’ said a familiar voice.

‘Yes, who’s this?’

‘Adam. It’s your father.’

I was speechless for a moment.

‘Dad... this is a big surprise.’

‘Yes, well, I have some news.’

‘What news?’

‘I’m coming to see you in Dubai.’

I almost dropped the phone. ‘Erm, Dad, right
now is not really the best time.’

‘Nonsense! There is no better time. Besides, I
have already booked my flights. Pick me up at the airport on Wednesday. See you
in a couple of days.’

As soon as he hung up, I slammed down the handset
in anger. Surely some kind of warning would have been nice? I had never been
very close to my father after my parents’ divorce, and I had spent much of my
life trying to prove to him that I didn’t need him around to be successful. But
instead of appreciating how well I was doing, he would now see me in the most desperate
state ever. If he had only visited just three months ago, he would have viewed his
son as a promising young businessman reaching for the stars, instead of the
unemployed bum I had become. His timing couldn’t have been worse.

***

I met him at the airport early in the morning and we took
a taxi over to my apartment. My father had never been to Dubai before, but
considering he was a builder by trade, I had assumed it would be like dying and
going to heaven for him. As we drove down the Sheikh Zayed Road, I pointed out
the landmarks and new developments, hoping to invoke a reaction. But he just
listened without saying a word.

Over the next few days, I took him to see the
Emirates Towers, the mighty Burj Khalifah and the Burj Al Arab. Like a tour
guide, I gave him the lowdown on each iconic project by rolling off every fact
I knew about the developer, the launch price, and even how much steel and
concrete had been used. But as before, there was no reaction from my father. He
just observed.  

If he hadn’t been impressed so far, I was
certain the next stop on the itinerary would blow him away. As we left the
coast and drove onto the Palm Jumeirah, I stared at his face, hoping for some
inkling of excitement. I remembered the moment I had first driven onto the Palm
and the overwhelming feeling of wonder. Yet again, he gave nothing away, which
was beginning to frustrate me.

On the last day of his short visit, I took him
to Bar 44 at the Grosvenor House hotel, which boasted impressive 360-degree
views of the Dubai Marina. Over a cocktail, I finally broke my silence.

‘So, Dad, you haven’t said a word about Dubai
since you got here. Aren’t you impressed with what you’ve seen?’

‘It’s okay,’ he replied.

‘Just okay?’

‘Yes. Just okay.’

I sighed heavily. ‘Dad, don’t you think it’s
amazing what they’ve done here? Aren’t you even a little bit impressed by the
feats of human ambition and engineering you’ve seen?’

He turned and looked into my eyes. ‘Not really,
son. To throw a bunch of money into building some nice-looking buildings is not
really difficult. Building a real, practical, functioning city takes a lot
longer. That’s true success.’

‘What do you mean? Are you saying Dubai is not
a “real” city?’

‘Son, when you look around at this place, all
you see is big shiny buildings. That’s all. I see beyond that. And let me tell
you, I haven’t been too impressed.’ I had no idea what he was talking about. ‘Do
you want to know what I have noticed over the past few days?’

‘What did you notice, Dad?’ I asked, rolling my
eyes sarcastically.

‘I noticed that there wasn’t a single phone box
in Dubai.’

‘What?’

‘A simple phone box. I haven’t seen a single
one in the six days I’ve been here.’

‘How do you know that?’ I was starting to get
agitated.

‘I was looking out for them. Not a single one.’
He shook his head adamantly.

‘Okay, but what’s that got to do with anything?’

‘It’s a perfect example of what I mean. The
glitzy façade is superficial. What matters is the thought and planning. These
are the things that don’t come overnight.’

‘Whatever, Dad.’ I accepted that our
conversation was going nowhere fast.

He suddenly started at me earnestly which made
me uncomfortable. ‘Son, I never objected to you coming to Dubai,’ he said. ‘Even
though you had a good job and prospects in London, I never stopped you.’

‘And why is that, then?’

‘Because I could see that you had a lot of
growing up to do. You were stupid and naive back then, with your ridiculous
pipe dreams of quick money and overnight success. This place attracted you
because everybody here thought the way you did. It was paradise for the lazy.
You foolishly thought you could cut corners and avoid the difficult path. But
just look at this place now. Look at you now. It’s all over, just as I
expected. All I hope is that you have learnt your lesson, son.’

‘What lesson?’

‘That there’s no such thing as a quick buck.
And that even if you make it, you lose two when things go against you. And they
always will.’

As much as I hated to admit it, he had summed
up my Dubai experience perfectly in a few simple words. I had nothing to say.

‘This experience has taught you some lessons that
you had to learn. But one thing I’m certain of more than anything right now is
that for the first time in my life I’m not sitting with my little boy any more.
I’m sitting face to face with a man.’

I stayed quiet as I allowed his profound words
to soak in. It was the most honest moment I had shared with my father in my
whole life. I couldn’t doubt a single word he had said. He was absolutely
right. Suddenly a lump formed in my throat, my bottom lip began to quiver and
my eyes filled up. Within seconds, I was a complete wreck and as much as I
tried, I couldn’t hold back the tears. My father leaned in to comfort me, but I
just grabbed his shoulder and bawled my eyes out. It had been a long, long time
since I had cried like this. Back then I had been a child, on a beach holding a
bucket and spade, feeling as utterly helpless as I did right now.

I dropped my dad off at the airport the next
day with a new-found respect for him. Somehow he had put everything into
context for me. His visit was a much-needed reality check and I was grateful. I
decided there and then that feeling sorry for myself was getting me nowhere.
The moment I returned to my apartment from the airport, I decided to do
something I should have done weeks ago: throw caution to the winds and have
some fun.

I didn’t have a great deal of money left, but I
had enough to stuff a bag in the back of a hired 4x4, fill up the tank and hit
the road. I didn’t really know where I was going, I just drove and drove. I
headed north along the Emirates Road towards the northern Emirates of Ras al
Khaimah and Fujairah. I had never even been outside the borders of Dubai, so I
was extremely excited to see what lay ahead.

As I reached the city walls, the Dubai skyline
dispersed behind me and I was engulfed by the sand dunes of the open Arabian
Desert. This was the real Arabia I had wanted to see since I arrived. There was
not a single building or skyscraper in sight. To my right was a herd of camels
grazing aimlessly across the golden sands. They were beautiful, imposing
beasts, once the lifeline of Bedouin existence; today as much a figment of
history as the Bedouins themselves.

The desert landscape soon turned into mountains
and valleys. A road sign informed me that I had passed into Ras al Khaimah,
which boasted some of the most beautiful natural scenery I had ever seen. There
were hills and springs and lakes, and not a single manmade structure or
settlement for miles. Dusk was fast approaching, so I decided to set up a small
camp on the beach nearby.

I had no idea how to erect a tent and as I
struggled, some young Emiratis who were camping close by came over to help me.
They didn’t speak any English, but somehow we bonded as they asked me to join
them to roast marshmallows over their roaring fire. We spent the evening
singing traditional Bedouin chants and smoking from a shared
shisha
pipe. They then invited me to offer the night prayer with them, so we lined up
facing the endless ocean and knelt together in complete submission to God. It
was the most spiritually fulfilling moment of my life, and I hugged each of
them tightly before retiring for the night.  

As the fire finally went out, I lay under the
star-spangled sky for an hour. It wasn’t a cold night nor was it too warm, but thankfully
the simple blanket I had packed was enough to keep me suitably cosy. The sky
above me seemed endless and I felt completely insignificant as I marvelled at
its majesty. Eventually my eyes began to grow weary and the gentle rhythm of
the ocean whispered me into a long, deep slumber.

I was woken by the gentle ocean breeze a few
minutes before sunrise. The morning air was delightfully crisp, and the sky was
beginning to turn a brilliant pink with the first rays of the new day. I washed
my face in the cold waters of the ocean, and as I looked up, there before me
unfolded the most glorious sunrise I had ever witnessed. I watched in utter awe
as the sun rose higher over the vast waters like a majestic beacon of light. I
saw its beams as rays of hope, heralding a new beginning and granting all it
touched another chance to emerge from the receding darkness.

I sat alone on the beach, the sheer beauty and
peace of my natural surroundings allowing me think clearly for the first time
in a long while. I thought about the city and how people had seen beauty in
blocks of glass and steel and concrete. But that was a mere mirage. Before me
was God’s masterpiece, with eternal beauty that could never be compromised.

The answer was suddenly crystal clear. I could not
have wished for a better end to my Arabian adventure than this. But I had not
an atom’s weight of doubt that it was finally time to go home.

When I was a child, there was always one story I would
repeatedly pester my father to tell me each night before bedtime. Carlo Collodi’s
tale of an ambitious wooden puppet called Pinocchio, who aspires to find his
way in the world and become a ‘real boy’, fascinated me more every time I heard
it. On his perilous quest, Pinocchio encounters countless challenges and
obstacles. He is swallowed by a shark, caught in a weasel trap by a farmer, and
conned by a cunning fox. But the episode that fascinated me most was when
Pinocchio follows a boy named Romeo to the Land of Toys, where children play
but never work. After having the time of his life watching puppets, bouncing on
balls and riding wooden horses, Pinocchio awakes to the horror that he has
grown donkey ears and a tail, a chilling symbol of ignorance and foolishness,
which terrified me every time.

In late 2009, after five years in the Gulf’s
Land of Toys, I finally returned home to face reality. But instead of feeling
defeated and demoralised, I experienced a peace with myself that I had not felt
for a long time. Like so many other ambitious expats, I had foolishly bought
into the promise of endless sunshine and unlimited tax-free riches, only to
fall victim to an inevitable reversal in fate. I had not made the great fortune
I had dreamed of, but I didn’t care. I had gained something more important that
no sum of money could ever buy: self-esteem.

The story of Dubai’s rise and fall is both
unique and familiar. Like the great empires of history, its foundations were
based on the fickle ambitions of visionary men who craved recognition and
praise, only to be undone by the most primal of human flaws: their own pride.
Every stakeholder played an equal part in Dubai’s demise. Speculators forfeited
their sense of reason for quick profits. Developers built towers they couldn’t
afford to meet the insatiable demand. The authorities failed to implement laws
and regulations while the city grew at breakneck speed. And the banks lent
recklessly to capitalise on the boom. It was perhaps fitting that they were all
penalised accordingly when the tide turned.

Looking back, as tempting as it was to deny it
at the time, Dubai had all of the hallmarks of an archetypal investment bubble
from the outset. My friend Cameron’s early investment represented the smart
money that went in before the masses. From my time at Imperial Bank to my first
experience at Cityscape, the Dubai real estate story gained massive momentum as
new investors latched on to the money-making potential of the boom; the
‘awareness’ phase. And the lavish parties, outrageous new buildings and global
interest that underpinned my time at Milestone were characteristic of the
‘mania’ phase that always precedes a devastating crash.

In the midst of every bubble, there are always
a few solitary voices who raise their concerns, only to be drowned out by those
too greedy to care. In 2008, the Morgan Stanley report was that voice for the
market at large, while I tried to warn my Milestone colleagues; we were both
mocked and silenced. From the Dutch Tulip Bubble of 1637 to the dot-com crash
of 2002, bubbles have remained ingrained in the human condition, and this truth
is unlikely to change any time soon. As hard as the faithful try to convince us
that ‘this time is different’, they are always proved wrong. It is never different,
and Dubai was no exception. Whether Arab, Western, Asian or African, history
has proven time and again that humankind remains driven by two raw emotions that
will haunt our decisions for centuries to come: fear and greed.       

What became of some of the characters I met on
my adventure? The last I heard, Jerome remains in Dubai and is working in
recruitment, although he is still seeking the deal that will make him a
millionaire. Jamal left Dubai for Miami, where he is setting up a distressed
real estate fund with some Cuban investors. The exact source of their money is
unknown. Sharaz and his wife divorced and she went back to London with their
son. He is now living with his new Russian girlfriend, Anna.

I never heard from Tariq again after I left
Milestone. There were rumours circulating that he had been sued for his entire
fortune by some powerful disgruntled investors, and that he had even spent some
time in prison. His was one of the saddest stories of the Dubai collapse: a man
who had spent his life building his legacy, only to see all of his work
disappear in an instant.

At the time of writing, some Dubai property
prices have fallen by as much as 65 per cent from their 2008 peak. More than
half of the incomplete projects have been cancelled. Many investors have lost
their entire life savings, and some are still fighting a lost battle against
developers who they haven’t heard from in years. Conservative estimates suggest
that the amount of money still hanging in the balance in the Emirate’s property
market is over one and a half billion dollars; funds that investors have
committed to projects that are yet to come to fruition. Until these disputes
are settled, Dubai will find it difficult to shake off the crisis of confidence,
and disillusioned investors, many of whom staked their life savings on the
fortunes of the market, will continue to remember the city as a graveyard of
dreams. It seems that the fallout of the decade-long property misadventure will
continue for some time yet.    

Can Dubai’s property sector ever rekindle its
glory days? Perhaps, but the ‘build it and they will come’ approach is no
longer the answer. Long gone are the deep-pocketed speculators, lavish property
launches and taxi-driving realtors. The true market dynamics of supply and
demand have exposed a glut of inventory yet to come online and a worrying lack
of end buyers. Today, property purchasers are more concerned with the alignment
of the kitchen tiles and the colour of the walls than finding the next fool to
flip to. Dubai has grown up and become a real city with sensible problems.

But neither will Dubai disappear into oblivion,
as some predicted after the crash. The recent events of the Arab Spring have
worked in its favour, as dislocated citizens from falling regimes seek a
regional haven with relative stability in the increasing turmoil. As much as
the new wave of expatriates spreading across the Gulf today talk up the
emerging opportunity in Doha or Abu Dhabi, they would all move in a flash if
they were offered a similar position in Dubai. The Emirate’s world-class
infrastructure and liberal lifestyle are unparalleled in the region and will
continue to attract new settlers. The luxury hotels will still bustle with
Eastern tourists, and weekend shoppers from South Asia and the neighbouring
Arab states will continue to pack the malls. The Middle East needs Dubai, and the
neighbouring kingdoms know full well that a full recovery of the city’s
fortunes is in the interests of the entire Gulf.

Looking back today, three years after the
crash, I still think about what was and may have been. I will always remember
fondly a unique period in history when I was fortunate enough to witness the
birth of a new city. In those four incredible years, I saw the best and the
worst of humankind. And despite coming excruciatingly close to being set up for
life and failing, I learnt lessons I will never forget.

Life back in London is not as fast or wild or
glamorous as it was during those crazy few years in Dubai. I miss the buzz, the
excitement and the spontaneity.  But despite all the tall buildings, super-malls,
endless beaches, Michelin-starred restaurants, trendy bars and night clubs,
there’s one thing I miss about Dubai more than anything else: a water pipe in
every bathroom to wash my backside with.