Developers hit by cost overruns

Volatile prices of building materials are causing strained relationships between contractors and developers, industry experts say.

The construction boom has created a huge amount of work in Dubai and while developers struggle with increasing prices, contractors have been the ones calling the shots.

"The last six months has seen a lot of volatility in the local market, especially with steel and cement. Contractors have been able to negotiate," said Riad Bsaibes, chief operating officer of Amana Contracting.