The white Cadillac would have gladdened the heart of any lottery winner -- except that it had obviously been standing in the parking lot overlooking Dubai's creek for at least a year. In its thick coating of dust somebody had scrawled with a finger: "take away -- free."
There are many such free takeaway motor cars to be seen accumulating dust outside abandoned buildings of Dubai, in Sharjah and in Abu Dhabi. "They borrow the money to put up the building," a resident Briton said, describing the United Arab Emirates citizens responsible for both the buildings and the cars sometimes left outside. "Then when it is nearly finished they start trying to find tenants and they can't find any. After a while they give up and go off, sometimes by airplane, and they just leave their new car outside their new building and never come back."
Speculating in property has caused building to run so far ahead of demand in the UAE that Sharjah, where it is probably at its worst, must be the world's most modern ghost town, with whole streets and boulevardes of brand-new buildings abandoned before they have ever been occupied.
To stop the process before it becomes a disaster, the UAE authorities are working on a package of measures both to restrain and direct further building activity and also to deal with the problem of bank loans that have financed most of this building. The total value of property loans in the United Arab Emirates is said to have reached $1.76 billion, accounting for a third of all bank credit in the area.
The municipality of Abu Dhabi is stopping permits for building new office blocks for the time being, and the market is so saturated with new living accommodations that there are reported to be 25,000 unoccupied flats in Abu Dhabi alone.
The next move will be to set up a real estate bank to take over most of the property loans, currently carrying interest rates of up to 14 percent, and to re-issue them at much lower rates, possibly between 4 and 5 percent.