Samana sets up $41m contracting company

DUBAI: Samana Developers, a real estate player in Dubai, is adapting strategically to the expected resource constraints that may arise from the industry’s rapid growth.

CEO Imran Farooq announced the establishment of a dedicated contracting company, backed by an initial investment of AED150 million (approximately $41 million).

The initiative marks a significant step in the company’s backward integration strategy, aimed at ensuring the seamless execution of its development projects.

The impetus for this expansion can be traced back to the remarkable 250 per cent growth experienced by many mainstream developers over the past year. While this surge signals a thriving market, it also raises pressing concerns regarding the ability of developers to complete a growing volume of projects efficiently.

Recognising potential limitations, including a shortage of contractors, insufficient machinery, and inadequate labuor accommodations, Farooq emphasises that these challenges could hinder project delivery by the end of 2025 or into 2026.

In light of these predictions, Samana Developers is proactively positioning itself within its supply chain. By enhancing in-house capabilities—such as establishing an independent design unit and forming a new contracting arm—the company aims to consolidate resources and maintain its reputation for timely project deliveries.

Navigating market conditions

The CEO outlined a three-pronged strategy for this venture: firstly, establishing a new contracting company equipped with the necessary licenses and operational requirements; secondly, pursuing a strategic joint venture (JV) with two established contractors for exclusive collaboration on Samana projects; and thirdly, adopting a white-label approach to secure essential supplies like concrete and steel exclusively for its use.

Farooq is confident in the company’s preparedness to navigate challenging market conditions, citing substantial financial resources held in escrow.

His belief is rooted in Samana’s experience during the pandemic, which highlighted the importance of resilience and strategic foresight. The commitment to establishing a dedicated supply chain through its contracting business and JV is not just a plan for growth; it is a necessary adaptation to ensure sustained success in an evolving market.

Currently, Samana Developers has 42 projects at various stages of development, with its latest ventures being the Ocean Pearl 1 and Ocean Pearl 2 projects on Dubai Islands. As it prepares to invest an impressive AED12.5 billion ($3.4 billion) in new residential projects and award 18 construction contracts throughout the year, the company exhibits a forward-thinking approach that aligns with the increasingly competitive real estate arena in Dubai.