VZCZCXRO4688
RR RUEHDE RUEHDIR
DE RUEHAD #0943/01 2331108
ZNR UUUUU ZZH
R 201108Z AUG 08
FM AMEMBASSY ABU DHABI
TO RUEHC/SECSTATE WASHDC 1353
INFO RUEHDE/AMCONSUL DUBAI 7905
RUEHZM/GULF COOPERATION COUNCIL COLLECTIVE

UNCLAS SECTION 01 OF 04 ABU DHABI 000943 
 
SENSITIVE 
SIPDIS 
 
STATE FOR NEA/ARP BMASILKO, NEA/PI, NEA/PPD, OES, EEB 
 
E.O. 12958: N/A 
TAGS: ECON EINV ETRD EIND SENV PGOV AE US
SUBJECT: ABU DHABI MEGA PROJECTS: SYNOPSIS OF PRIORITY PROJECTS 
 
REF: A) Abu Dhabi 920, B) Dubai 272, C) Dubai 271, D) Abu Dhabi 791 
 
ABU DHABI 00000943  001.2 OF 004 
 
 
SUMMARY 
------- 
 
¶1.  (U) As Abu Dhabi Mega-Project development changes the landscape 
of the UAE's capital city, this cable will describe some of the more 
ambitious projects.  These include: Yas Island ($40 billion 
entertainment development will be home to the world's first Ferrari 
theme park); Saadiyat Island cultural zone (to feature a Guggenheim 
Museum, Louvre, Maritime Museum and National Museum, among other 
upscale cultural and recreation offerings); Lulu Island (resort 
within view of the Abu Dhabi Corniche [main waterfront area], with 
visions of commercial, residential, cultural and recreational 
facilities); Al Raha Beach (11 "districts" to house up to 120,000 
residents and business enterprises); Cleveland Clinic (integrated 
clinic-hospital design will serve local and international patients 
with world-class medical care); and Masdar City (a proposed city of 
50,000 residents that will be 100% environmentally friendly and 
carbon neutral).  While the Mega Projects described below are some 
of the more prominent (and expensive) currently underway in Abu 
Dhabi, they are only a sample of the Emirate's ambitions.  Peaceful 
nuclear power is also on the agenda.  Other key structures and 
extensive development plans will drastically change the landscape of 
the city, keeping the construction crane (the UAE's "national bird" 
to many) flying high for years to come.  This is one of a series of 
planned cables related to on-going project development in Abu Dhabi 
(see ref A).  End summary. 
 
YAS ISLAND 
---------- 
 
--- Concept/Location:  Residential and recreational "island" created 
by dredging a canal to separate it from the mainland, a short drive 
outside of Abu Dhabi in the direction of Dubai and very near Abu 
Dhabi International Airport. 
--- Estimated Cost:  $40 billion 
--- Estimated Labor Force:  35,000 
 
¶2.  (U) On August 3, ECONOFF visited the initial stages of Yas 
Island on the outskirts of Abu Dhabi to tour the dusty grounds and 
meet with planning officials.  Yas Island occupies a total land area 
of 2,500 hectares (approximately 6 km. by 7 km.), of which 1,700 
hectares will be developed into attractions such as a world-class 
motor sports racetrack (Formula 1), signature hotels, a 
Ferrari-based theme park (a three-story indoor theme park conceived 
as part of Abu Dhabi Mubadala's purchase of a 5% stake in Ferrari in 
July 2005), a Warner Brothers theme park, an indoor sports stadium 
(patterned after the Staples Center in Los Angeles), water parks, an 
enormous shopping mall (connected to the Ferrari park), golf 
courses, lagoon hotels, marinas, polo clubs, apartments, and 
villas. 
 
¶3.  (SBU) Yas Island's construction is in the preliminary stages and 
will open in phases over the next 5-7 years.  According to Aldar 
Marketing and Communications Manager, Said El-Khouri, Yas Island 
will host a Formula 1 Race in November 2009 as its initial 
attraction (and as a driving force behind ambitious construction 
deadlines).  (Note: Septel will offer background on Aldar and other 
mega developers.  End note.)  Against the backdrop of a bustling 
construction zone, El-Khouri said that when he started the job a few 
months prior, "there was no research" conducted before construction 
commenced to gauge the sustainability or the scope of the market 
audience. 
 
¶4.  (SBU) Comment:  While the plans for Yas Island are grand and 
impressive, key questions remain, such as who will populate the 
residences and patronize the attractions?  A Formula 1 race will 
certainly attract a crowd now and again, but research on the 
customer base for multiple theme parks remains tentative. 
Apparently no marketing data has been gathered to define the target 
audience (although Aldar's presentation began with a world map 
showing flight times from Europe and Asia to the "hub" of Abu 
Dhabi).  End comment. 
 
AL RAHA BEACH 
------------- 
 
--- Concept/Location: Eleven precincts of luxury residential and 
commercial real estate, gardens and amenities within a few minutes 
of Abu Dhabi (across the bay from Yas Island and near the 
International Airport). 
--- Estimated Cost:  $15 billion 
--- Estimated Labor Force:  20,000 
 
¶5.  (U) Al Raha Beach, an approximately $14.7 billion project, is 
set along Abu Dhabi's sheltered coastline on the mainland 
thoroughfare to Dubai (in close proximity to Abu Dhabi airport) and 
will feature eleven precincts.  Each precinct will have unique 
 
ABU DHABI 00000943  002.2 OF 004 
 
 
features, variously including luxury residential apartments, 
townhouses and villas, private boat moorings, retail high streets, 
local supermarket and shops, waterside restaurants and cafes, public 
beach with landscaped gardens, luxurious shared gardens and open 
spaces.  The headquarters of Aldar, which is developing the project, 
will also be housed in a disc-shaped structure that is beginning to 
take shape at one end of the development.  There are long term plans 
to have a Light Rail Transit (LRT) system for speedy transit 
throughout the development, in addition to (as yet undefined) plans 
to expand access by rail to both Abu Dhabi and Dubai.  Al Raha 
currently aims to have more than 120,000 residents. 
 
¶6.  (SBU) A recent group of visitors was told that Al Raha was 
putting up construction cranes as fast as the Italian supplier could 
produce them -- its building pace limited only by factors beyond its 
control.  When completed, Al Raha aims to house more than 120,000 
residents.  Some hope that such residential developments will 
relieve pressure on the housing shortage in Abu Dhabi generally, 
while others fear that the upscale nature of Al Raha and its sister 
projects will offer little relief to the low and middle income 
demographic that keeps the city running.  For now, plans remain 
upscale. 
 
SAADIYAT ISLAND 
--------------- 
 
--- Concept/Location:  Cultural zone on newly developed island 
within a kilometer or two of Abu Dhabi city center. 
--- Estimated Cost:  $30 billion 
--- Estimated Labor Force:  20,000 
 
¶7.  (U) "Saadiyat" Island, which means "island of happiness", is one 
of 200 islands located off the shore of Abu Dhabi which are to be 
developed into an abundance of cultural and residential properties. 
The $30 billion project will feature seven districts (Cultural, 
South Beach, Saadiyat Beach, Wetland, Lagoon, Marina, and Eco-point) 
and aims to be a cultural gathering place featuring a Guggenheim 
Museum, a branch of the Louvre, a Maritime Museum, and the new 
Sheikh Zayed National Museum.  UAE President Khalifa bin Zayed 
al-Nahyan has persuaded Frank Gehry to design the latest and, at 
450,000 square feet, the biggest branch of the Guggenheim.  French 
architect Jean Nouvel is behind the first offshoot of the Louvre 
outside of Paris.  Beyond museums and performing arts facilities, 
there will be villas, condos and apartments, golf courses, 29 hotels 
with various leisure and entertainment offerings. 
 
¶8.  (U) Targeting more than 170,000 residents and an upgraded 
transportation infrastructure (two bridges and a tunnel to connect 
the island to the mainland), Saadiyat's design aims to restore 
mangrove and beachfront eco-systems, mandate energy-efficient levels 
of residential density (lower density being the environmentally 
friendly target footprint), introduce mass-transport systems, 
integrate into the cultural offerings a wide range of community and 
education facilities, and provide housing for a broad range of 
income groups.  The overall development of the island will be phased 
over 15 years, with the first phases becoming operational by 2012. 
The island is 2,700 hectares in size, with approximately 1,000 zoned 
for development at an estimated cost of just under $30 billion. 
News reports estimate that it will take 20,000 laborers to complete 
the project. 
 
¶9.  (SBU) A mock-up of the Saadiyat plan, with detailed 
architectural renderings of key museums and how they fit into the 
overall island development, has been on display in a specially 
designed portion of the 7-star Emirates Palace Hotel main floor for 
more than a year.  Even the mock-up has been a tourist draw (as if 
the Emirates Palace itself and the rotating exhibits next door -- 
most recently a 200-piece Picasso retrospective -- were not enough 
to captivate visitors).  The Crown Prince of Abu Dhabi has enjoyed 
showing this display to prominent international visitors as evidence 
of the development aspirations of Abu Dhabi, linking his own 
credibility to the success of the project. 
 
LULU ISLAND 
----------- 
 
--- Concept/Location:  Tourist holiday resort area within view of 
the Abu Dhabi Corniche, with plans to further develop the Island to 
include a mix of commercial and residential projects. 
--- Estimated Cost:  $11 Billion 
 
¶10.  (U) The largely manmade Lulu Island is spread over 1050 acres 
(425 hectares) just off the coast of Abu Dhabi's main downtown 
waterfront.  Given its proximity to the Corniche, tourists can 
easily hire a boat to cross the bay and relax on a quiet beach on 
the sandy island.  By some accounts Lulu is one of the more famous 
islands in the region, possibly because of ambitious expectations 
when work began in early 1988 to transform it into a comfortable 
holiday resort protected on the sea-ward side by a breakwater. 
 
ABU DHABI 00000943  003.2 OF 004 
 
 
Early rumors of a Disneyland style park never came to fruition, and 
the island still sits calmly in the bay.  The island is reportedly 
to be developed as a mixed commercial and residential project, with 
plans for hotels and restaurants to complement the resort 
atmosphere, although few signs of construction are obvious.  Lulu 
Island has several beaches and could be a focal point for water 
sports; officials hope it might attract more tourism to Abu Dhabi 
(in competition with Dubai).  Lulu Island is, for now, a quiet 
sandbar with big expectations. 
 
CLEVELAND CLINIC 
---------------- 
 
--- Concept:  Integrated clinic-hospital to serve local and 
international patients in an environment that combines excellent 
amenities with world-class medical care. 
--- Estimated Cost:  Undisclosed 
 
¶11.  (U) The Abu Dhabi branch of the Cleveland Clinic aims to be a 
landmark structure in a new financial district to be built on Al 
Sowa Island, one of the city's many nearby islands.  In 
architectural renderings, the 360-bed, 2.5 million square foot 
facility looks like a collection of interlocking glass rectangles 
stacked atop one another.  The hospital will include 
state-of-the-art environmental features such as double-skinned glass 
facades designed to conserve energy while flooding the interior with 
daylight.  Scheduled to be operational in 2011, it will include a 
multi-specialty tertiary center and adjacent clinic.  The integrated 
clinic-hospital design will serve local and international patients 
in an environment that combines excellent amenities (at the VIP 
level which the Emirati public has come to expect) with world-class 
medical care. 
 
¶12.  (U) The Ohio-based Cleveland Clinic -- a not-for-profit, 
multi-specialty academic medical center that integrates clinical and 
hospital care with research and education -- has a 15-year operating 
agreement with Mubadala, an Abu Dhabi government investment arm 
chaired by Sheik Mohammed bin Zayed Al Nahyan, Crown Prince of the 
emirate.  (Note: Mubadala Development Company is a public joint 
stock company focused on developing and managing an extensive and 
economically diverse portfolio of commercial, infrastructural and 
educational initiatives for the Emirate of Abu Dhabi.  Septel will 
report more on Mubadala's mission.  End note.)  The Cleveland Clinic 
already has experience in delivering health care in Abu Dhabi, as a 
team of its personnel has administered Abu Dhabi's premier hospital, 
the Sheikh Khalifa Medical City, for over a year. 
 
MASDAR CITY 
----------- 
 
--- Concept/Location:  A 100% environmentally friendly and carbon 
neutral city and research facility between Abu Dhabi and the 
International Airport. 
--- Estimated Cost:  $22 Billion 
 
¶13.  (SBU) Masdar ("the source" in Arabic) envisions a 6 square 
kilometer city that will be the world's first zero-pollution, 
zero-waste community capable of housing 50,000 to 100,000 people. 
Purportedly scheduled to start limited operations by 2009, 
construction of the full project is expected to be completed by 
¶2015.  No traditional gasoline fueled cars will be allowed in the 
city; transit, desalination, and waste management systems will be 
non-polluting; and water-saving technologies should reduce water 
consumption by 80 percent.  Beyond its role as a model environmental 
zone, Masdar City hopes to host some of the best academics from the 
around the world to research alternative energies and 
environmentally safe development.  As with other projects described 
in this message, it has the strong backing of (and was, by Masdar's 
account, conceived by) the Crown Prince of Abu Dhabi Mohammed bin 
Zayed.  (Note: A more in-depth report on Masdar will be provided 
septel.  End note.) 
 
NUCLEAR POWER PROJECT 
--------------------- 
 
--- Concept:  To develop peaceful nuclear energy to satisfy rising 
electricity demand as the UAE economy booms. 
--- Estimated Cost:  Approximately $79 billion, including nuclear 
reactors 
 
¶14.  (SBU) All of this development is meaningless without reliable 
utilities -- electricity and water chief among them.  The UAE is the 
world's fifth-largest oil exporter (it has the fifth largest proven 
reserves) and Abu Dhabi has recently undertaken a plan to develop 
nuclear energy to satisfy rising electricity demand as its economy 
booms on record oil export revenues.  A no-holds-barred construction 
boom is seriously straining the power supply.  Limited generation 
capacity, low feedstock supplies (such as natural gas) to augment 
that capacity, and an inadequate national grid, have the nation on 
 
ABU DHABI 00000943  004.2 OF 004 
 
 
the verge of an "energy" crisis even as the world may assume it is 
swimming in oil. 
 
¶15.  (SBU) The UAE's current oil reserves should last for a century, 
but non-oil energy demand is expected to double by 2015 and the 
population of the Arabian Peninsula could double by 2050.  Abu Dhabi 
sees nuclear energy as a solution.  Currently, the Emirates Nuclear 
Energy Corporation (ENEC, initiated and administered by the Emirate 
of Abu Dhabi) is inviting pre-qualified firms to bid on a contract 
to manage the country's emerging nuclear power program.  Abu Dhabi 
seeks to establish a nuclear regulatory authority and, according to 
press reports, is planning to build up to 14 nuclear power plants at 
a cost of $79 billion in a bid to satisfy growing demand for 
electricity.  (See ref D for more background on the nuclear 
program.) 
 
AND ETC. 
-------- 
 
¶16.  (SBU) As if the sampling above were not ambitious enough for a 
resident population base of 4-5 million (approximately 900,000 
being UAE citizens), the longer list of Abu Dhabi projects 
includes: 
 
--- Khalifa City, a master-planned metropolis on the mainland that 
in another 20 years may replace the island of Abu Dhabi as the new 
capital; 
--- Reem Island, a new centerpiece of urban development between the 
current downtown area and Saadiyat Island; 
--- Sheikh Zayed Mosque, an enormous structure near the bridges to 
Abu Dhabi which at $2 billion, under construction since 1992, is 
nearly completed, having opened for prayers and visitors in fall 
2007; it boasts the world's largest hand-made carpet (from Iran) and 
largest chandelier (from Germany), and Italian white marble 
throughout; 
--- Expansion of the Abu Dhabi International Airport in conjunction 
with the growth of Itihad Airways; 
--- Taweelah Port, eventually to replace Abu Dhabi's Port Zayed, in 
a less congested location some distance from the city; 
--- A replacement for the "traditional" market torn down in 2006 
which developers promise will recreate the old ambience (while 
architectural drawings show three very tall modern buildings rising 
out of it); 
--- Al Qurm Resort along one side of the narrower part of Abu Dhabi 
island, with upscale residential properties on the opposite shore 
(highways on both sides featuring construction walls to block views 
of the construction); 
--- a new "Khalidiya Palace" hotel, residence and office complex 
rising high just across the street from the Emirates Palace; 
--- upscale nature preserves both along the coast (towards Qatar) 
and inland (near Al Ain); 
--- talk of a broad program of urban renewal in the Emirate's 
"second city" of Al Ain (on the border with Oman); 
--- and the bridges, highways, and infrastructure to support (in 
theory) all of the above. 
 
This list is by no means exhaustive. Construction has become a way 
of life in Abu Dhabi, as has long been the case in Dubai.  Like 
Dubai, it is clear that Abu Dhabi envisions much more than a modern 
home for its citizens -- it seeks to attract the outside world's 
notice and to entice foreigners to visit. 
 
¶17.  (SBU) Comment:  With the boom in construction and 
infrastructure development in Abu Dhabi, there have also emerged a 
number of new, and rapidly profitable, developers.  In a subsequent 
cable, post will look at the powerful developers and (largely 
government-affiliated) financiers behind some of these projects. 
Many are believed to operate under the personal guidance of Abu 
Dhabi Crown Prince Mohammed bin Zayed.  End comment. 
QUINN