Dubai: What goes up must come down


I remember sitting on a beach in Florida several years ago reading an October 17, 2005 New Yorker article about the real estate boom in Dubai and thinking two things: First, this must be one of the biggest and most amazing construction booms in human history; and second, this will not end well. Three and a half years later, it is ending very badly.

The New Yorker article described a real estate construction boom of unimaginable size. It mentioned one Mohamed Ali Alabbar, founder and chairman of Emaar, a real estate company then "valued at $25 billion, and the developer of a building -- the Burj Dubai -- that will be the tallest in the world. He [was] also erecting the world's largest shopping mall and the world's largest aquarium." This was only the most gaudy part of Dubai was had "a mile-long line of modern skyscrapers 30-, 40-, 50-stories high and a beachfront of artificial islands," according to the New Yorker.