Skyscraper link to financial crises
Source: Agencies |
January 12, 2012, Thursday
|
Print Edition
Print Edition
AN "unhealthy correlation" exists between the construction of skyscrapers and financial crashes, according to a new report from Barclays Capital.
The construction of the Empire State building in New York in 1930, along with towers in Kuala Lumpur in 1997 and Dubai in 2010 have all been followed by economic crises, the report noted.
"Often the world's tallest buildings are simply the edifice of a broader skyscraper building boom, reflecting a widespread misallocation of capital and an impending economic correction," it said.
"The completion of Petronas Towers in Kuala Lumpur in 1997 was followed by a region-wide economic crisis and the collapse of Asian currencies," it added.
Investors should pay special attention to China, the Skyscraper Index warns, as the "biggest bubble builder" is currently erecting 53 percent of the 124 skyscrapers planned over the next six years.
China currently has 75 completed buildings above 240 meters in height.
The world's tallest building is the Burj Khalifa in Dubai at 828 meters, followed by Taipei 101 at 508 meters and the Shanghai World Financial Center at 492 meters.
The construction of the Empire State building in New York in 1930, along with towers in Kuala Lumpur in 1997 and Dubai in 2010 have all been followed by economic crises, the report noted.
"Often the world's tallest buildings are simply the edifice of a broader skyscraper building boom, reflecting a widespread misallocation of capital and an impending economic correction," it said.
"The completion of Petronas Towers in Kuala Lumpur in 1997 was followed by a region-wide economic crisis and the collapse of Asian currencies," it added.
Investors should pay special attention to China, the Skyscraper Index warns, as the "biggest bubble builder" is currently erecting 53 percent of the 124 skyscrapers planned over the next six years.
China currently has 75 completed buildings above 240 meters in height.
The world's tallest building is the Burj Khalifa in Dubai at 828 meters, followed by Taipei 101 at 508 meters and the Shanghai World Financial Center at 492 meters.
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