Qatar prepares for the 2022 World Cup

While Qatar’s current infrastructure boom has been in the works since 2008, when Qatar National Vision 2030 (QNV 2030) was unveiled, development has been given extra impetus, and a mid-term deadline, by the 2022 FIFA World Cup. With 1m visitors expected to flock to the state for the tournament, tourism projects have risen to the forefront of Qatar’s high-profile developments. Contractors will benefit from the construction of eight multibillion-dollar stadia and a rash of hotel builds, adding tens of thousands of beds to the existing supply and making tourism one of the most high-potential construction segments, although concerns over the long-term sustainability of so many new builds could see some of the most ambitious plans scaled back.

SPENDING SURGE: In April 2011, the Qatar Tourism Authority (QTA) announced that the state would invest $20bn-25bn in new tourism projects up to 2022. QTA officials said they expected hotels would receive the bulk of planned investments; the state had just 10,000 hotel rooms as of 2011, and the QTA projects that an additional 5000 new rooms will be added annually through to 2022. Preparations for the World Cup have also led to huge planned expenditure on stadia construction. In June 2014, Qatar’s Supreme Committee for Delivery & Legacy (the SC), which was established in 2011 to oversee World Cup preparations, told the Financial Times that the state had already spent $500m on tournament projects since Qatar won the bid in 2010.

STADIA: Authorities have so far unveiled designs for four of the eight planned stadia. The first design to be revealed was that of Al Wakrah, which will have space for 40,000 people and host 16 World Cup matches, with construction set to finish in 2018. The design contract was awarded to AECOM and Zaha Hadid Architects, which modelled its structure on a dhow boat, traditionally used for pearl diving. Plans for the second stadium, Al Bayt, were revealed in June 2014. To be built in Al Khor, it will have a capacity of 60,000, and was modelled on a bayt al sha’ar, a tent traditionally used by nomadic peoples in Qatar and other Arab nations.

Khalifa International Stadium is the third proposed host venue, with authorities announcing plans in November 2014 to refurbish the existing stadium in the Aspire Zone in western Doha. The stadium was built in 1976 and renovated for the 2006 Asian Games, with the latest renovations expected to see the addition of a new building to the east wing and a single roof to cover the seating area, as well as the 3-2-1 Qatar Olympic and Sports Museum. Dar Al Handasah and Projacs won design consultant and project manager contracts, respectively, while a joint venture between Midmac Contracting and Belgium’s Six Construct will act as contractors. Construction is expected to wrap up in 2017.

In December 2014, the fourth design, for Qatar Foundation Stadium, was unveiled. The arena will be built in Education City, with a complex, reflective geometrical exterior that pays tribute to traditional Islamic architecture. The stadium will have a capacity of 40,000, and construction is expected to be completed in 2018.

In October 2014 the SC announced it would award a construction contract for Al Wakrah Stadium in 2015.

Doha News reports that it is likely to be awarded to a joint venture between an international contractor and a Qatari firm, in keeping with Qatarisation and knowledge transfer mandates under QNV 2030. Also in October, the SC announced plans to demolish and rebuild Al Rayyan Stadium, a departure from previous plans to double its capacity to 40,000 through refurbishment.

OTHER ATTRACTIONS: Outside of new sports facilities, Qatar’s tourism infrastructure is expected to significantly expand through construction of new hotels and attractions, including the $32m New Doha Zoo, the new National Museum expected to open in 2016, and the $1.6bn Doha Festival City, which will have facilities including a snow park and an outdoor water park.

The $45bn Lusail City will also bring major tourism projects; the city’s master plan includes two golf courses, a theme park, a lagoon and two marinas, with 22 hotels planned across 19 districts, making it an important centre for tourism and offering spin-off benefits to an array of contractors. “The opportunities for landscaping contractors keep increasing. The Local Roads Programme, the Expressway Programme, Lusail City, metro stations, the World Cup and more will provide substantial work. We expect more landscapers to join, increasing competition. We also expect price escalation due to pressure on raw materials,” said Ghassan Oueijan, the managing director of Nakheel Landscapes.

NEW HOTELS: According to real estate firm DTZ, 125 hotels are currently under construction in Qatar, which on completion will raise the stock of rooms in the state to approximately 35,000. A rise in tourist numbers was recorded by QTA in 2014, with the hotel occupancy rate increasing from 65% in 2013 to 73% in 2014. The Qatar National Tourism Sector Strategy Plan 2030, published in February 2014, outlined public and private investment of $45bn in tourism projects, with a view to increasing tourist numbers to 7m by 2030, and the government is investing heavily in new hotels.

Grand Murwab City Centre, which will open in 2015 with 265 rooms and suites, as well as 97 furnished apartments, is the latest addition for state-owned Katara Hospitality. In December 2014 the firm also issued a construction tender for Katara Towers, Lusail Marina District, the crescent structure of which is expected to become a landmark when it opens in 2018. As well as being a hotel, the development will feature branded apartments catering to permanent residents, as well as suites, restaurants and recreational facilities.

Katara Hospitality stipulated that pre-qualifying firms will have experience developing similar projects with budgets in excess of QR600m ($164m), and posting annual turnover of at least QR1bn ($274m).

Katara officials are also considering building a $1.6bn offshore hotel, the Silver Pearl, a pair of 30-storey semicircular towers connected by an atrium, whose design was unveiled in November 2014. In a departure from artificial islands like the Pearl, it would be supported by piers, allowing water to flow beneath the building.

VIABILITY: There has been some concern among industry stakeholders that the number of hotel rooms coming on-line may be untenable in the long term. “At the moment there is no new supply coming into the market, so occupancy is rising, but there is a huge pipeline of supply coming up. We’re at 16,000 keys presently, but current projects will see this expand to at least 60,000. I don’t know how that is sustainable,” Mark Proudley, associate director of real estate consultancy DTZ, told OBG. Consultancy Colliers International estimated the number of hotel rooms in Qatar would reach 95,000 by 2022, up from 15,000 in 2013.

Others argue that the market will correct itself, with alternative accommodation springing up if hotel builds do not finish on time. “Accommodation for World Cup visitors will certainly be available, but the options are not limited just to purpose-built hotels; cruise ships, villas or furnished apartments could also be utilised,”

Steven Humphrey, Qatar director at AECOM, told OBG.