When Lehman Brothers filed for bankruptcy on September 15, 2008, very few people in the UAE’s real estate and construction sectors took note, let alone understood its significance and possible consequences. 
Most property developers and brokers in Dubai were, in fact, busy finalising new projects and sales campaigns ahead of the annual Cityscape Global exhibition and conference that usually takes place in the first week of October.
Those were the last few weeks of the unprecedented property boom that had swept the entire UAE - led by Dubai. The real estate community had little time to breathe and note anything beyond their projects and sale campaigns.
The October 2008 edition of the Cityscape Global - which usually reflects the pulse of the property market - had its share of the buzz.  A number of mega projects were launched at the event amid huge fanfare, although talks of a possible bubble burst had gained momentum at the event itself.
By November, all hell broke loose. Property brokers were the first to smell trouble as their sales declined sharply. Suddenly, there were no buyers. Suddenly, there was no money in the market. People had begun to lose jobs. Those who had debts started to panic. By December, a number brokerages closed down while hundreds of projects stopped. Contractors had to stop works due to lack of payments while some developers suddenly weren’t there.
Rizwan Sajan, founder and chairman of Danube Group, a building materials company, said it focused on global markets to sustain business in 2008. “Adopting a balanced investment approach and minimal financial exposure Danube was equipped with a set of competencies necessary to deliver its best at all times. It was the wise thinking and strategic planning of the company where we decided to focus our attention on other markets outside the UAE during the downturn. In fact the economic downturn has been a blessing in disguise for our business,” Sajan said.
Similarly, Sharjah-based Mulk Holdings, which is involved in Construction Materials, Renewable Energy and Health Care, kept its sights abroad to stabilize business. “We weren’t significantly affected by the crisis, as our brand has a presence in 80 countries across the world. Hence, our market development efforts in the developing nations like the Brics [Brazil, Russia, India, China and South Africa] countries, ensured we retained our positive growth despite the recession in Middle East and Europe,” said Aasim Shaik, the company’s business development manager.
Down in Abu Dhabi, Romani Ebrahim, managing director at Maccaferri Middle East, which supplies construction materials, said: “We didn’t suffer a lot because we started activities at the end of 2008 with a small target and we kept our growth [and] expectations at a reasonable rate. A fair amount of our business was generated in Abu Dhabi and Ras Al Khaimah, which were still growing even during [the global crisis], albeit at a slower pace than before [the global crisis].“
Ebrahim added that his company managed to export during that period, which enabled it to grow.
The downturn was in no way limited to real estate. Before October 2008, most media thrived on real estate advertisements. Suddenly, all stopped. As a result, those relied on the property advertisements, could not sustain their publications.
Marketing solutions companies were also affected by the 2008 slump.
Prakash Chandrabalan, chief financial officer at Bates Pan Gulf (BPG) Group said: “The financial crisis of 2008 [and] 2009 did have an impact on BPG but it was contained since we managed the crisis effectively by adapting quickly to the new reality by re-engineering our processes and right sizing the team. Also we were fortunate with the above average growth of our regional business during that time which compensated for the UAE downturn. We also used the opportunity to restructure our commercial model by moving to fee based revenues. These changes have positioned ourselves to manage the current upswing in the region - the UAE in particular- rather well.”
Meanwhile, stock brokers, who saw a sharp drop in traded stock volumes during the financial crisis. “Stock volumes suffered too much during 2009 and 2010. 100 million were traded per day in Dubai and Abu Dhabi. Now, around 1.5 billion is traded per day. We are seeing the volume of stocks getting back to how it was before the crisis,” said Ebrahim Daas, senior broker at Al Dhafra Financial Broker in Abu Dhabi.
Saudi Arabia and Qatar fell 6.49 and 7.06 per cent respectively on September 15 after the Lehman Brothers news. Dubai only fell 1.71 and Abu Dhabi 4.35 per cent. Over the next two months, Dubai lost 38.2 per cent of its value, while Abu Dhabi fell 24.6.
Today, property developers and banks that are recovering from the 2008 downturn  are rallying after a string of debt restructuring.
Frank Khoie, CEO of property developer Khoie Properties notes that small and medium sized enterprises (SMEs) should learn from the downturn and invest carefully. “The ultimate lesson is to remember that some sort of economic crisis is always around the corner and we can never be too prepared...Never put all your eggs in one basket, certainly keep thinking of âwhat if’ scenarios and prepare yourself, your finances, and your team for those âwhat if’ scenarios, so that when and if they happen you are prepared.”
Dubai’s preceived image as a safe haven in the Middle East has also helped return of investor confidence and the influx of capital. “The UAE’s political stability during the Arab Spring and high oil prices has helped attract foreign capital to the UAE real estate market,” Rohit Walia, Executive Chairman of Alpen Capital (ME) Limited, told Gulf News.
“Dubai’s status as a safe haven continues to drive inward investment into the sector, as investors shy away from some of the more troubled areas across the broader region.”