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. Last Updated: 07/27/2016

Dubai to Boost Its Allure With Waterfront Project

DUBAI, United Arab Emirates -- In a city already synonymous with flashy developments, a multibillion dollar project may set a precedent for construction projects across the globe.

The project, named the Dubai Waterfront, is a conglomeration of canals and islands studded with luxury hotels and homes. Larger than the island of Manhattan, the development will reconfigure the map of this tiny desert emirate by adding 800 kilometers of man-made waterfront, according to Nakheel, the government-held developer.

The Dubai Waterfront is expected to house 400,000 people and transform the last stretch of Dubai's undeveloped Gulf seashore. In a twist unique for Dubai, foreign investors are being offered a minority stake in one of the emirate's signature mega-projects. U.S. companies, including hotel operators, plan to be part of the deal.

The development, expected to cost tens of billions of dollars, is aimed at capitalizing on Dubai's tourism and real estate boom.

Nakheel says it has audacious designs for the site, split between land and sea. The company plans a new city center that will include one of the world's tallest skyscrapers, as well as a 70-kilometer canal cleaving the desert and a sweeping arc of man-made islands that spills far into the Gulf. The developer said it hopes to finish the first phase -- including the skyscraper and artificial islands -- in around five years.

Nakheel's chief executive, Sultan bin Sulayem, told Dow Jones News Service he could not reveal the names of investors who had approached the company or give the estimated cost of the project until investment partners have been named.

With the Dubai Waterfront, Crown Prince Sheik Mohammed bin Rashid Al Maktoum announced that the emirate would drop further restrictions on outside investment by allowing foreign developers to take a stake in the project. Nakheel will hold a majority share of 51 percent and offer 49 percent to investors.

"For the first time, investors can partner with Nakheel and realize gains from land sales," said bin Sulayem, as quoted by Dow Jones.

Nakheel's four ongoing man-made island projects, costing a combined $14 billion, are the world's largest land reclamation efforts. If the waterfront is built according to plans, it will consist of 440 square kilometers of water and land developments, an area 2 1/2 times the size of Washington, D.C.

The Palm Jumeirah, the first coastline project, set to be complete next year, is a palm tree-shaped island group with reclaimed land and sprawling concrete villas that can be seen rising above the water offshore.

A U.S. developer, Kerzner International, has announced plans to build a $1.1 billion, 2,000-room hotel complex on the Palm Jumeirah. The complex has been dubbed Atlantis, the Palm, and is expected to be similar to Kerzner's Atlantis, Paradise Island hotel complex in the Bahamas.

Another of the artificial archipelagos, the Palm Jebel Ali, will be nearly surrounded by the new islands from the waterfront. The islands are supposed to extend a few kilometers into the sea.