World’s tallest building, Burj Dubai Tower, opens as a golden era closes

Burj Dubai, or Dubai Tower, will be the world's tallest building.

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Burj Dubai Tower, the world’s tallest building, is a spire of superlatives.

The 160-story skyscraper will open on January 4, the fourth anniversary of Sheikh Mohammed bin Rashed al-Maktoum’s rule in Dubai.

Under the Sheikh, Dubai has seen a boom in record breakers, impressive firsts, and baffling spectacles. For example, the city is or will be home to the , a twirling tower, the world’s largest arch-supported bridge, and artificial islands in the shape of the world map.

And Burj Dubai boasts more surprising bullet points than simply being the world’s tallest tower:

• At 2,700 feet tall, the skyscraper can be seen from 10 miles away.

• The building will sport the fastest elevators in the world, traveling at 10 meters per second (22 miles per hour). They will also be double-decker elevators, with each deck supporting up to 21 people.

• To keep out the desert heat, 10,000 tons of coolant with flow through the tower every hour.

• 230,000 cubic meters of concrete form the building’s core, enough to pave 1,180 miles of sidewalk.

• Dubai Tower will be the highlight of the worlds’ largest indoor shopping center, with space for 1,200 shops nestled among 30,000 apartments.

But Dubai is a very different place this month than it was in 2004 when construction began on the tower. As AFP reports:

Plunging property prices and weak demand had already put a dampener on new schemes even before last week’s shock announcement by state-owned giant Dubai World that it wants to halt debt payments for six months.

“It’s not exactly going to improve investor confidence,” said Matthew Green, associate director at property agency CB Richard Ellis, which has reported a 55 percent year-on-year drop in downtown Dubai commercial rental rates and a 67 percent fall outside the centre.

Dubai Sends a Reminder to All Investors

In just about any endeavor, complacency can be detrimental to continued success. Many of the most successful companies in the world have risen to the top of their respective industries by always being on the lookout for encroachments on their domain. For investors, when they get used to their environment for too long, they tend to stop noticing the potential dangers that might come out of seemingly nowhere.

That is just what has occurred recently with the announcement by Dubai that they would no longer be paying interest on loans made to two of its state owned companies as they have run into financial trouble. Recall it was just a few short years ago that another Dubai state owned company – Dubai World – had wanted to buy several US ports. That only fell through due to congressional and popular opposition.

The news of Dubai’s debt deferment shocked many investors who had thought that by now problems associated with the credit markets had become all but old news. Many investors had been shaken out of their complacency and all of a sudden risk mattered again. They reacted by selling off stocks and seeking the safety of the US dollar. However, as the markets began to sort the facts from fiction and Dubai received support from the United Arab Emirates, things have seemed to settle down and all is quiet – for now.

Dubai's skyline with the world's tallest building - the Burj Dubai.

The key lesson from this episode is that investors should always be on the lookout for the potential of being blindsided and to be able to ask themselves how their portfolio would hold up should the unexpected happen.

In Dubai’s case, the fact that things have unraveled for them is no surprise at all. Throughout the last several decades, we have seen country after country receive huge capital inflows through lenders all too willing to provide loans and foreign investment racing in to take advantage of some future potential mega project. The issue is that investors never seem to learn their lesson.

The internet is rife with numerous slideshows making their way by email showing Dubai’s progress and the unfathomable statistics relating just how much construction activity was under way. The statistics certainly were impressive but seldom – if ever – did we see any objective analysis of whether or not these exciting construction projects are economical, will they be able to stand up to a global blindsiding such as we have seen over the last two years or if they even made sense. When debt is available cheaply, enthusiasm tends to get the best of even the most rational investor.

In short, complacency was on display as banks continued to make loans for projects that may not be economical for a very long time. Amazingly, some banks seemed to have thought that in the event of default, the government would simply pick up the tab. To their dismay, they are realizing that the governments of Dubai and the UAE are not going to simply step up and pay the bills. Today, many of the developments have stopped construction and the rulers of Dubai are left to wonder “What happened?” The amazing aspect to this story is that it has been repeated in country after country. In the 1980s, most of South America was left with a debt hangover, in the 1990s it was Mexico and most of Asia and today it is Dubai. Investors might want to ask where might the next unknown come from?

Burj Dubai World’s tallest building

The world’s tallest building, the Burj Dubai, is set to open on Jan. 4, 2010 despite the financial crisis its home-city is currently facing.

The Burj Dubai was topped out early in 2009 at a record-breaking 2,684 ft. The building broke eight world records; it is currently the tallest freestanding structure in the world, the building with the most floors and, once completed, will feature the highest elevator installation in the world. During its construction, its final height was increased multiple times. Originally, the tower was planned to stand only 1,837 ft. The exterior of the building was completed early last month and work has now shifted to the interior of the building in order to prepare it for when its first occupants move in early next year.

The tower is located in Dubai, United Arab Emirates. Dubai has recently experienced an economic downturn as the construction boom that has driven its economy for many years halts. Dubai recently announced that it was unable to pay interest on its $59 billion debt. Despite the economic crisis currently facing Dubai, the Burj Dubai is still planned to open as scheduled

first peek inside the towering Burj Dubai

The Burj Dubai, the tallest man-made building in the world at 2,684 ft., is set to be completed in the United Arab Emirates in January of 2010. The UK's Telegraph website recently posted some rare photos from inside the nearly-finished superstructure, along with some incredible facts about the project. Among them:

• The Burj Dubai will have the world's fastest elevators at approximately 40 miles per hour.
• The external surface of the skyscraper is the equal to the size of 17 football fields.
• Like to "get high" when you party? The Burj Dubai will have a club on floors 144 through 146.
• The building is estimated to cost roughly $4 billion, about three times more than the new Yankee Stadium.

Burj Dubai Getting Struck By Lightning

A tipster sent along this spectacular photo of the Burj Dubai, the world's tallest, most absurdly ostentatious building, getting struck by lightning. While checking for newness, I noticed something amazing: This happens all the time.

Well, not all the time, since storms aren't exactly a daily occurrence in Dubai. In a way, though, that makes the sheer number of occasions this has been caught on film all the more impressive.