New York's got nothing on these guys

Seems the 'richest city in the world' title is up for grabs again. Abu Dhabi is going for it, however: "plans call for almost $200 billion to be spent here over the next ten years." "Welcome to Abu Dhabi, the capital of the United Arab Emirates and the richest city in the world. The emirate's 420,000 citizens, who sit on one-tenth of the planet's oil and have almost $1 trillion invested abroad, are worth about $17 million apiece. (A million foreign workers don't share in the wealth.) Yet most people couldn't find Abu Dhabi on a map." "We're not trying to be Dubai. What they've done is phenomenal, and we're very proud of it. But here we have a unique opportunity to get it right." "The city of Abu Dhabi sits at the tip of a T-shaped island jutting into the Persian Gulf. Wide tree-lined boulevards run through clusters of utilitarian concrete-slab high-rises and modern mirrored towers. An elegant corniche stretches the length of the city along the coast. There are finely manicured roundabouts, abundant fountains, and more trees than anywhere else on the Gulf. But it's oddly quiet - there's little traffic, few pedestrians, and no nightlife to speak of. That's all about to change. From a helicopter you can see sandy islands covered with dump trucks and crisscrossed with empty highways sitting offshore like blank canvases. It's a stark contrast to what lies just 15 minutes up the coast by air: a landscape of cranes, yacht harbors, man-made islands in exotic formations, and what will soon be the tallest building in the world. There's nothing subtle about Dubai. Its crowded, smoggy skyline is part Miami, part Las Vegas, and all new. There's scarcely a plot of open space or an uncongested highway." "The population of Dubai, an emirate the size of Rhode Island, was concentrated in a small merchant community that capitalized on the town's sheltered and navigable creek. Abu Dhabi, roughly the size of West Virginia, was much poorer. Bedouin tribesmen roamed the desert; pearl divers lived in huts where the city is today. Then, in 1958, British explorers discovered what would turn out to be the world's fifth-largest crude reserve, 90 percent of which was under Abu Dhabi. That discovery - and the wealth that came with it - made the Nahyans the dominant family in the region when the British pulled out in 1971. Sheikh Zayed bin Sultan al Nahyan, the ruler of Abu Dhabi, became President of the newly independent UAE, while Sheikh Rashid bin Saeed al Maktoum of Dubai became Prime Minister. Zayed set out to carve a modern country in the sand. When the oil started flowing, the city of Abu Dhabi had just 46,000 people, four doctors, and five schools. Rich people had mud houses; poorer families built with reeds. "As students, we were provided with books, transportation, and a small salary," remembers Mohammed Ahmed al Bowardi, a longtime government advisor. "Sheikh Zayed, our country's George Washington, realized that the people needed an incentive to come to school. So that 100 dirham [about $27] meant a lot to us. As his country became wealthy, Zayed insisted that "not a single grain of sand" be sold. Though most men received plots of land, transferring ownership required the sheikh's approval. As a result, native-born Arabs - rapidly becoming a minority in their own country - got land while outsiders couldn't buy any. That made it difficult to attract foreign investment, especially when oil prices plunged to $18 a barrel in the late 1990s." "As Dubai raced ahead, Abu Dhabi stood still - a Melbourne to a Sydney, a Philadelphia to a New York. One businessman remembers weeds growing out of cracked streets in 2000. Zayed had grown ill, and no one dared to suggest radical changes. Another problem: Zayed technically owned all the land. "The horses were being held behind," says al Bowardi. That all began to change in 2004, after Zayed's death. Power fell to two of his 19 sons: Sheikh Khalifa, his eldest, became President, and the much younger Sheikh Mohammed became crown prince, taking over the day-to-day running of Abu Dhabi. Soft-spoken but shrewd, Mohammed is considered the most Western of the emirate's leaders. A graduate of Britain's prestigious Sandhurst military academy, he used his control of the UAE's armed forces to amass the economic and political clout he needed to become the heir apparent to Khalifa. (He's also a pretty good fighter pilot.)" "The next thing Abu Dhabi needed was a landmark. The answer was the $3 billion Emirates Palace hotel, with its $1,000-a-night rooms and $10,000 suites. It was Abu Dhabi's bid to outdo Dubai's Burj Al Arab, the $1 billion sail-shaped hotel that has become a tourist attraction. The plan worked: While the Emirates Palace doesn't seem to have many guests, it does have gawking European tourists. But the most important change was Law No. 19. It formally abandoned the old property regime and permitted the sale of land by citizens and, in some areas, the purchase of 99-year leaseholds by foreigners. The real estate boom started immediately." "There wasn't a rush to simply copy what Dubai did. After all, beneath that city's glitter are serious problems no one likes to talk about. Its infrastructure is overtaxed, inflation is climbing, and crime and prostitution are on the rise. Abu Dhabi has a more traditional and more religious population, unwilling to sacrifice its way of life for tourist dollars." "We don't seek to become a commoditized destination for mass tourism," says Sheikh Sultan bin Tahnoon al Nahyan, chairman of the new Abu Dhabi Tourism Authority. "We're creating an exclusive, high-end tourist destination." Perhaps the best example of that is Saadiyat Island, a $30 billion project that includes 29 hotels, three marinas, two golf courses, and housing for 150,000 people. But what makes it different from Dubai is the attempt to create a cultural oasis in the desert. "When we were designing it, we thought there had to be some of what we call 'pearls,'" says Jose Sirera, an architect with Gensler, a San Francisco firm that designed the master plan for the island. "It needed art galleries or museums or special gathering places." "Soon the crown prince was meeting with Thomas Krens, the director of the Guggenheim Museum in New York City. "He said he wanted a cultural destination that everybody in the sophisticated world of art and culture would have to visit," Krens says. "So I said, 'Let's take what's worked around the world and magnify it by 50%.'" "The result: a 670-acre cultural district designed by some of the world's best-known architects, including Zaha Hadid, Jean Nouvel, Tadao Ando, and - at the special request of the crown prince - Frank Gehry, who will try to outdo what he did for the Guggenheim in Bilbao, Spain. For good measure, Abu Dhabi offered a reported $1 billion for an outpost of the Louvre, the Paris museum's first. The entire plan is estimated to cost billions. "I never expected to be able to design another one of these places," Gehry says. "But in Abu Dhabi you can do things that would be unthinkable anywhere else." "All that highbrow intention doesn't mean Abu Dhabi hasn't borrowed some Dubai-like ideas. Yas Island will have a Ferrari theme park and driving school (Abu Dhabi owns 5% of Ferrari through Mubadala), a racetrack winding its way around the island, water parks, a dozen hotels, four polo fields, a golf course, and a Formula One racing team. The Danet Abu Dhabi development will feature 36 mixed-use towers, two shopping malls, two mosques, and a five-star hotel. On Al Reem Island, Shams Abu Dhabi will have a canal system like Venice's, a central park like New York City's, and an 83-story skyscraper. So if they build it, will they come? Certainly some of the residential projects will sell, because Abu Dhabi faces a housing shortage and rents that are increasing almost 50% a year. (A three-bedroom apartment is as expensive as in Manhattan.) Other projects may never get off the ground. But Davidson, the UAE expert, thinks Abu Dhabi has a better model than Dubai's. "Dubai relies totally on commerce and tourism, so if there were a war, instability, or terrorism, Dubai is finished," he says. "Abu Dhabi's brand of tourism would be able to bounce back. It's not relying on Europeans who could change their favorite destination on a whim. Abu Dhabi is going after Arab tourism and investment." "Khaldoon likes to tell a story about how the crown prince works. Abu Dhabi's outdated seaport, situated in a prime location, was causing problems for redevelopment. "He said, 'We've got to find a new location,'" Khaldoon says. "Within 60 days, everyone came back. All the options were put on the table. He made his decision right there. Boom. A new location for a new port and the land to go with it. Things like that just don't happen this quickly anywhere else in the world."