PROTECTION AND WEALTH BUILDING STRATEGIES 225the United Arab Emirates, a strong ally of the United States
with a potent military in a strategic location near the Strait of
Hormuz in the Persian Gulf.
It is one of the two most important emirates, along with the
capital of Abu Dhabi. Dubai is the best known emirate because
of its efforts to make itself a resort, shopping and commercial
center and transportation hub serving a vast region from South
Asia to Africa, Europe and beyond.
This was my third visit to Dubai in recent years; I had been
there in December 2008 and September 2011. Those two prior
visits came just before and after the November 2009 collapse
of Dubai World, a government-sponsored holding company,
which had $60 billion in debt.
The Dubai World collapse marked the beginning of the
global sovereign debt crisis that rolled through Greece, Ireland,
Portugal, Spain and Italy over the course of 2010, 2011 and
- My 2008 visit came at the height of the bubble.
My 2011 visit came in the depressed aftermath. This latest
visit was a chance to see how Dubai was doing five years after
the crash of one of the biggest commercial real estate bubbles
of all time.
The financial collapse of Dubai World and its affiliates in
2009 was handled in a fairly conventional way. Some debt was
written off, some was restructured on new terms and still other
debt was converted to equity.
Abu Dhabi provided working capital and new investment
to keep projects afloat and to keep systems operating during
the workout and restructuring process.
Eventually, the balance sheet was cleaned up and Dubai
World was in a position to grow again, albeit with much tighter
financial controls and more oversight of projects.
This newfound capacity to grow was evident in the new
projects and improved sentiment I saw on the ground there.
Rents are now rising and investors are again buying up mul-