Dubai’s road-toll operator, Salik, announced a combined valuation of AED 2.73 billion for its two upcoming toll gates. The new gates—one at Business Bay Crossing on Al Khail Road valued at AED 2.3 billion and another at Al Safa South on Sheikh Zayed Road valued at AED 469 million—are set to become operational by the end of November 2024. This expansion will increase Salik’s toll gate network in Dubai from eight to ten, aiming to improve traffic flow and reduce congestion on some of the city’s busiest routes.
Strategic Expansion to Reduce Traffic Congestion
Salik’s latest infrastructure investments are part of a broader strategy to enhance Dubai’s mobility. The new toll gates are expected to significantly alleviate traffic congestion: the Business Bay Gate is projected to reduce congestion by 12% to 15%, while the Al Safa South Gate is anticipated to cut congestion by 15%. These estimates are based on detailed traffic impact studies conducted by Dubai’s Roads and Transport Authority (RTA), which aim to ensure each gate’s placement aligns with the city’s strategic traffic management goals.
Mattar Al Tayer, chairman of Salik, emphasized the importance of these new installations, stating, “These strategic investments underscore our dedication to sustainable growth and providing more seamless mobility across Dubai by enhancing travel efficiency and reducing traffic congestion. The new gates will play a crucial role in optimising travel time and reducing congestion on some of Dubai’s busiest routes.”
#RTA has carried out a series of improvements to the entrances and exits of Majan and Al Barari communities leading towards Sheikh Mohammed bin Zayed Road, which included redirecting vehicle movement from the tunnel to a reversible lane system and installing a signalised junction… pic.twitter.com/7kjdaIbyiT
— RTA (@rta_dubai) August 27, 2024
Financial Structure and Revenue Projections
Under an agreement with the RTA, Salik has exclusive rights to construct, operate, and maintain the toll gates until the end of June 2071. To finance the AED 2.73 billion valuation of the new gates, Salik and RTA have agreed on a six-year repayment plan starting in November 2024. The repayment will consist of annual instalments of AED 455.7 million, divided into two equal payments of AED 227.9 million every six months.
The addition of these new gates is expected to boost Salik’s financial performance. The company has revised its revenue-generating trip guidance for 2024, raising it to an estimated growth of 7-8%, up from the previous forecast of 4-6%. The projected earnings before interest, taxes, depreciation, and amortisation (EBITDA) margin is set to remain strong at 67-68%.
Enhancing Dubai’s Infrastructure and Mobility
The introduction of the new toll gates represents Salik’s continued commitment to modernising Dubai’s infrastructure and enhancing traffic management. Last December, the company also partnered with Emaar Malls to implement a seamless parking management system at Dubai Mall. This initiative, which introduced paid parking from July 1 at the mall’s Grand, Cinema, and Fashion parking areas, further highlights Salik’s role in improving transportation and mobility within the city.
As Salik continues to expand its toll gate network and enhance its services, these developments are poised to support Dubai’s growth as a global city while addressing the increasing demand for efficient transportation solutions.
