Dubai UAE News from the Press Property Market Disaster and More

  • Dubai 7 Stars
  • May 2010
    M T W T F S S
  • Middle East Unrest Update

  • Talk of the Town

    Jo Hopworth on Justice For Natalie – Na…
    Mariam on Criminal Complaint filed in Ge…
    Martin Kraeter on ACI Dubai Funds filed bankrupt…
    Independent Observer on Iranian’s lawsuit reveals roya…
    Rado on DubaiTouristen landen schnell…
    Dubai Citizen on Al Fajer Properties Case…
    Dane on Outlook in concrete- Dubai Wor…
    jamesl fayad on RERA Dubai – Dubai Prope…
    Jacques on Malika Karoum finally arrested…
    James Brown on ACI – Alternative Capita…
    Journalist on Al Fajer Properties-500 Invest…
    ron oakeley on ACI – Alternative Capita…
    Benson Fu on Shahram Zadeh against Al Fajer…
    Monika on RERA – Dubai mulls cance…
    Ali Varahram on Shahram Zadeh against Al Fajer…
  • Top Rated Comments

  • Top Posts

  • RSS Dubai United Arab Emirates Property Real Estate Debt Fraud Developer Investor Court News

    • Criminal Complaint filed against Al Fajer Properties Sheikh Maktoum
      Criminal Complaint filed in Germany against Sheikh Maktoum Hasher Maktoum Juma Al Maktoum CEO of Dubai Developer Al Fajer Properties The Dubai Sheikh who mislead and extort a German Couple  Germany – Dubai 2011 A German elderly couple , today 80 + 50 years old who have been Dubai Tourists since a decade, bought in 2005 an apartment at Nakheel´s Dubai Residen […]
    • UAE: Human Rights Blogger, Sorbonne Lecturer Charged With ‘Humiliating' Officials
      source Human Rights Watch www.hrw.org (Beirut) - The United Arab Emirates attorney general should immediately drop all charges against five pro-democracy activists to halt their trial, Human Rights Watch said today. The charges of "humiliating" top officials relate solely to the defendants' peaceful use of speech to criticize the UAE governmen […]
    • Nakheel Dubai Sunland Case
      June 5, 2011After 21 hearings, Chris O'Donnell, the Australian chief executive of Dubai's major developer, Nakheel, came to the defence of his former colleagues Matthew Joyce and Marcus Lee. Mr Joyce and Mr Lee are accused of profiting from the sale of land that had been earmarked for a colossal high-rise development, which was to include the futur […]
    • Dubai Nakheel CEO decided to leave the company
      Dubai June 7, 2011 Nakheel said on Wednesday that its CEO Chris O'Donnell had left the company "after completing his contract terms". O'Donnell, an Australian who joined the developer in 2006, said he had decided to leave Nakheel following five years spent with the company, the statement added. O'Donnell has overseen a traumatic time […]
    • Owner of Dubai Developer Damac Hussain Sajwani files case against Egypt corruption ruling
      Dubai property developer Damac said on Tuesday it had filed an international arbitration case against Egypt over a land dispute and the conviction of its chairman and owner, Hussain Sajwani.A Cairo court last week sentenced Sajwani in his absence to jail and ordered him to pay a $40.5 million fine in connection with his 2006 purchase of land at Egypt's […]
    • Dubai Palm Jumeriah - Investors plan to take legal action
      Investors in Dubai Palm Jumeirah’s Golden Mile complex will this week serve the developer behind the project with a legal ultimatum to hand over their units or issue them with a refund.Up to ten investors in the luxury complex plan to issue Souq Residences with legal notice in a bid to force a resolution to a dispute that has been ongoing for more than a yea […]
  • Top Rated Posts

    • 489,955 visitors 2010
  • Disclaimer 7 Stars Dubai

    This Website of the Blog 7starsdubai.wordpress.com and 7starsdubai.com content still existing media releases and comments from reputated press and websites only. The content of this Website focus to consumer protection for Investors of the Dubai Property market, the UAE and the Middle East. Press Article from the international Press who report about Fraud in relation with Property Investment and Real Estate Developer Investor Disputes in Dubai and the UAE as well reports from the Press about other criiminal acts and Civil Real Estate cases, Lawsuits before the Court in Dubai, the UAE or other countries. Furtheron we show reports about consumer protection and human rights in the Middle East. Actual Topics about the Unrest in Middle East. The information comprised in this section is not, nor is it held out to be, a solicitation of any person to take any form of investment decision. The content of this site does not constitute advice or a recommendation by us.Communications and should not be relied upon in making (or refraining from making) any decision relating to investments or any other matter. You should consult your own independent financial adviser and obtain professional advice before exercising any investment decisions or choices based on information featured in this Web site. We can not be held liable or responsible in any way for any opinions, suggestions, recommendations or comments made by any of the contributors to the various columns on this Web site nor do opinions of contributors necessarily reflect those of us.In no event shall we be liable for any damages whatsoever, including, without limitation, direct, special, indirect, consequential, or incidental damages, or damages for lost profits, loss of revenue, or loss of use, arising out of or related to this Web site or the information contained in it, whether such damages arise in contract, negligence, tort, under statute, in equity, at law or otherwise. Comment Rules: Although the administrators and moderators of 7starsdubai.com will attempt to keep all objectionable comments off this Blog, it is impossible for us to review all comments . All messages express the views of the author, and neither the owners of this Blog, nor the administrator of this Blog will be held responsible for the content of any message, comment. By agreeing to these rules, you warrant that you will not post any messages that are obscene, vulgar, hateful, threatening, or otherwise violative of any laws. The adminstrator of this Blog reserve the right to remove, edit, move or close any comment (message) for any reason This Blog content still existing media releases and comments from websites only. The information comprised in this section is not, nor is it held out to be, a solicitation of any person to take any form of investment decision. The content of this site does not constitute advice or a recommendation by us.Communications and should not be relied upon in making (or refraining from making) any decision relating to investments or any other matter. You should consult your own independent financial adviser and obtain professional advice before exercising any investment decisions or choices based on information featured in this Blog. We can not be held liable or responsible in any way for any opinions, suggestions, recommendations or comments made by any of the contributors to the various columns on this Web site nor do opinions of contributors necessarily reflect those of us.In no event shall we be liable for any damages whatsoever, including, without limitation, direct, special, indirect, consequential, or incidental damages, or damages for lost profits, loss of revenue, or loss of use, arising out of or related to this Web site or the information contained in it, whether such damages arise in contract, negligence, tort, under statute, in equity, at law or otherwise. Copyright: The copyright to the text of the blog is held by the author or link as source provided, where applicable. All images displayed are copyright their respective owners and are used either under licence or under the fair use provisions of international copyright law. The information contained in this Web site is for general guidance on matters of interest only. The application and impact of laws can vary widely based on the specific facts involved. Given the changing nature of laws, rules and regulations, and the inherent hazards of electronic communication, there may be delays, omissions or inaccuracies in information contained in this site. Accordingly, the information on this site is provided with the understanding that the authors and publishers are not herein engaged in rendering legal, accounting, tax, or other professional advice and services. As such, it should not be used as a substitute for consultation with professional accounting, tax, legal or other competent advisers. Before making any decision or taking any action, you should consult the administrator of this website. While we have made every attempt to ensure that the information contained in this site has been obtained from reliable sources, 7starsdubai.com is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information in this site is provided "as is", with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. In no event will 7starsdubai its related partnerships or corporations, or the partners, agents or employees thereof be liable to you or anyone else for any decision made or action taken in reliance on the information in this site or for any consequential, special or similar damages, even if advised of the possibility of such damages. Certain links in the Web site connect to other sites maintained by third parties that may or may not be presented within a frame on the Web site. 7starsdubai.com has not verified the contents of such third party sites and does not endorse, warrant, promote or recommend any services or products, that may be provided or accessed through them or any person or body which may provide them. 7starsdubai.com has not issued or caused to be issued any advertisements which may appear on these Web sites. We do not review, monitor or endorse any third party web sites linked to Our Site and We are not responsible for the content of any web site linked to Our Site. Your access to any web site that links to Our Site is at your sole risk. We are not responsible for the information, material, products, or services contained on or accessible through such other web sites and will not be liable for any form of loss or damage arising as a result of or in connection with your visits to such web sites. Any links to other web sites are provided merely for the convenience of the users of this Site and the inclusion of these links does not imply an endorsement of the linked web sites or the content therein. In addition, you agree not to link your web site or any other third party web site to Our Site or frame Our Site as part of any other web site without Our express prior written consent. We reserve the right, at any time and for any reason not prohibited by law, to deny permission to anyone to link a web site to, or frame, Our Site. We reserve the right to withdraw Our consent at any time to a link to, or framing of, Our Site at Our sole discretion without notice. Your use of this Site and the operation of these Terms and Conditions shall be governed by and construed in accordance with the laws and regulations of and applicable in Germany You agree, acknowledge, and submit to the Court in Germany having non-exclusive jurisdiction over all and any dispute or difference between us arising out of or in connection with this Agreement. Please review these Terms and Conditions carefully before using this Site. Your use of this Site indicates your irrevocable agreement to be bound by these Terms and Conditions (as may be amended by Us from time to time). If you do not agree to be bound by these Terms and Conditions please stop accessing and using this Site immediately. Warning: We are aware that several times Cybercriminals mirrowed our Website and posted on several Forums, Website comments by misuse of our email adresses. These Cybercriminals registerd several similar looking Domains and installed several 1:1 mirrowed Websites which look like our Website 7starsdubai. We have already taken the necessary steps by filing criminal complaints against the Individuals behind this Identity theft an Cybercrime, by misusing fraudulently our Blog Identity 7starsdubai. In Search engines like Google, Yahoo, Bling and others you should always take a close view to the links. If this links do not originaly start with www.7starsdubai.com or http://7starsdubai.worpress.com/.... you will end on a faked mirrowed modificated Website. The genral Background of this Cybercriminals is a Stalking and Smear campaign, faking stories for their personal use, to discriminate Persons with the goal to destroy their reputation.
  • RSS ZDF Heute Germany

    • An error has occurred; the feed is probably down. Try again later.

Archive for May, 2010

Dubai Lawyer Ludmilla Yamalova was kidnapped in Yemen

Posted by 7starsdubai on May 28, 2010

source ABC News
Ludmila Yamalova and Glen Davis were in the middle of their vacation in Yemen when a sightseeing trip in the mountains took a terrible turn. Davis and Yamalova were kidnapped by armed Yemeni tribesmen who were hoping to trade the two Americans for a family member who was in jail.
The Yemeni government was eventually able to negotiate their release. Yamalova and Davis flew to Dubai on Thursday

In today’s Conversation Yamalova and Davis speak with ABC’s Lara Setrakian about the ordeal. They explain their initial confusion, and how eventually that turned into serious fear.

Still, the experience was not exactly your normal kidnapping, Yamalova tricked their kidnappers into thinking her cell phone was off. Instead she used it to text U.S. officials in Dubai, who began working on their release. They were also able to take pictures with the phone while in captivity.

Today’s Conversation is an example of one very tense, strange and compelling vacation that luckily had a happy ending.

Posted in Dubai, Lawyer Dubai, Ludmilla Yamalova | Tagged: , , | Comments Off on Dubai Lawyer Ludmilla Yamalova was kidnapped in Yemen

Dubai seeks another debt delay

Posted by 7starsdubai on May 28, 2010

Source Telegraph UK

The statement said Dubai International Capital (DIC) nd a committee of
were asking for a three month delay on “certain maturities”.

It did not give a value for the maturities in question, or for the
size of the company’s debts. But DIC had a loan coming due in June
$1.25bn (£864m).

continue reading

Posted in Debts dubai | Tagged: | Comments Off on Dubai seeks another debt delay

Dubai Property Court Disaster – Four Judges and over 1000 cases

Posted by 7starsdubai on May 24, 2010

source The National
Heavy workland of Justice

The hearing begins and a few words and papers are exchanged between the judge and the lawyers representing each side.

Within minutes, it is all over. Claimants and defendants are quickly ushered out of the courtroom as their respective lawyers whisper a roughly translated version of the judge’s ruling. Moments later, the next case begins.

Welcome to Dubai’s Property Court, a division of the emirate’s legal system that has been dealing with the fallout of its property crisis since September 2008.

As case files spill out of a room one floor down from the court, officials decline to reveal how many property disputes are under way or pending. A clerk in charge of registering cases hints that the figure may be in the “thousands”.

“We are overwhelmed … it is too much work,” says the clerk, who does not want to be named. “Some cases are small, some are big. People should try and settle with the developer as they will spend more bringing the problem here.”

Just a few months after it opened in 2008, the Property Court had a mammoth challenge on its hands after the property downturn.

The court is a “work in progress”, says Dr Jamal Alsumaiti, the director general of the Dubai Judicial Institute. “You can see there’s movement from the government for regulation and for developing the judicial system as well … it’s a very critical period.”

Ron Oakeley is more than familiar with the Property Court, and the huge investment of money and time that come with a lawsuit.
The British businessman, who has been in Dubai since 1985, is about to attend his 15th hearing in a case filed more than a year ago against Alternative Capital Investment (ACI), a German developer.

Mr Oakeley is trying to recover more than Dh1.2 million (US$327,000) he spent on two offices at ACI’s long-delayed Niki Lauda Twin Towers, one of a trio of projects launched in late 2007.

His efforts, in part, paid off in February when the court rendered his agreement with ACI for one of the units “void” and ordered the company to repay him Dh569,585, plus 5 per cent interest from the date he started proceedings.

The court ruled for Mr Oakeley because ACI had failed to register the property with Dubai’s Land Department, according to court documents. A property contract is valid only when it is registered with the department.

But Mr Oakeley lost the case for the second unit, which cost Dh695,000, because the court found that the property had been registered, although it has since emerged it was under somebody else’s name.

ACI was quick to appeal the decision on the first unit. At yesterday’s hearing, the court decided to appoint an official to check on construction progress at the site, which appears to be at a standstill.

If there is still no conclusion at the next hearing, scheduled for June 23, then the case could go to the Court of Cassation, the final stage in the judicial process.

Mr Oakeley is one of dozens of investors with suits against ACI. He says it has so far cost Dh400,000, including fees and the cost of lawyers. But with the project showing little sign of progressing, he says he has no choice but to fight on.

“It’s the principle … most people can’t afford to keep fighting,” he says. “Unlike elsewhere in the world, you’ve got to spend so much more money to get your rights.

There are hundreds of other projects in the same boat but nobody seems to be helping the people.”

Robin Lohmann, the chief executive of ACI, was unavailable for comment in the past two days.

Property disputes are generally filtered through the Dubai Land Department, where the department’s legal team tried to resolve them before they reach a courtroom.

While there is a surge in the number of investors turning to the department after the financial crisis, fewer people are approaching it today, says Mohammed Sultan Thani, the assistant director general of the Land Department.

“We are now seeing a lot of agreements between the buyer and seller,” Mr Thani adds. “There’s been a lot of movement of buyers between a project that hasn’t started to one that has.”

Since the Property Court is costly, it has mainly been used by major investors such as Mr Oakeley, who have the funds to pursue a case.

It costs Dh30,000 to register each case with the court, so if an investor has bought 10 apartments from one developer, simply lodging the dispute will cost Dh300,000.

As well, all cases require a local lawyer, who will charge a commission of up to 5 per cent of what the client is claiming. The proceedings are in Arabic so a claimant would have to pay for the translation of court documents as required.

“For an investor contemplating filing a legal case against a developer, it is advisable to first seek consultation with a lawyer who can advise whether filing a case makes sense based on the circumstances,” says Ludmila Yamalova, a partner at Al Sayyah Advocates and Legal Consultants.

Some cases have been settled out of court, Ms Yamalova adds, with developers agreeing to reimburse claimants in instalments.

With just four judges at the Property Court, cases can be long. But more than 18 months after it was established, steps are being taken to refine the system, says Dr Alsumaiti – a move that will likely boost confidence among investors.

Four judges are not enough,” he says. “The concept of having a specialised property court isn’t new but the implementation is. The judges need to have the skills and knowledge to understand every single detail of a case. As long has you have provisions to speed up your procedures, you have a very strong legal system.”

Posted in ACI Lohmann Dubai, Dubai court, Dubai Legal - Real Estate Lawsuits, Dubai Property Court, Dubai Property dispute | Tagged: , , , | Comments Off on Dubai Property Court Disaster – Four Judges and over 1000 cases

Dubai Investors wish to get answers: We don’t want our cash back we want Nakheel to build Jebel Ali Palm

Posted by 7starsdubai on May 24, 2010

source Arabian Business
Investors who bought homes on a delayed project by troubled Dubai developer Nakheel are hiring a law firm to represent them as they seek negotiations with the company, a spokeswoman said on Thursday.

“Nakheel have recently informed owners of further delays of at least five to 10 years,” said Aarti Chana, spokeswoman for Palm Jebel Ali Homeowners.

“The owners voiced major concern over the fact that Nakheel’s statement has broken key terms in our contract without seeking owners agreement,” she said.

A Nakheel spokeswoman declined to comment, when reached by Reuters by telephone.
continue reading…

Posted in Dubai, Dubai Property dispute, Dubai Property legal, Nakheel, Property Investor Dubai | Tagged: , , | Comments Off on Dubai Investors wish to get answers: We don’t want our cash back we want Nakheel to build Jebel Ali Palm

Dubai – The result for many buyers of Nakheel Jumeirah Village properties

Posted by 7starsdubai on May 24, 2010

Uninhabitable structures and financial exhaustion !
Frustrating wait for a Villa in Jumeirah Village

source The National May 24. 2010

DUBAI // Buyers of villas in an upmarket development claim they have been thrown into limbo by stalled construction and what they say is a lack of communication from their site developer.

Hundreds of villas and townhouses in Jumeirah Village, a sprawling development on the outskirts of Dubai, were nearing completion in 2008 as the global recession began, which affected the developer, Nakheel, and caused work on the project to be held up. A handful of residences have since been finished and occupied.

Nakheel has acknowledged that the restructuring of its heavily-indebted parent company, Dubai World, affected progress on the community. The result for many buyers of Jumeirah Village properties has been uninhabitable structures and financial exhaustion.

“We’ve paid Dh3 million (US$816,000). It’s gone,” said Mumtaz Desai, a 35-year-old Briton, referring to the two-bedroom Mediterranean style-villa she thought she would be living in with her husband and 14-year-old daughter.

That plan has turned into a money trap for Ms Desai and her family. Promised a handover date of December 2008, repeated delays have forced them to live in a rented apartment in the Jumeirah Lake Towers to save money.

“We’re all squeezing into a little one-bedroom apartment,” she said. “It’s me, my husband and my daughter. She’s always had her own bedroom. We’re like: ‘You’ll just have to suffer a little longer’. But two months of delays has become six, and now it’s nearly three years.”
continue reading…..

Posted in Dubai Property dispute, Nakheel, Real Estate Scandal Dubai | Tagged: , , | Comments Off on Dubai – The result for many buyers of Nakheel Jumeirah Village properties

Dubai Criminal Court fresh reports – Nakheel executives accused of receiving bribes

Posted by 7starsdubai on May 22, 2010

source Emirates Business

Dubai, 21 May 2010

An expert of the Financial Audit Department, Mohammed Mustafa Hussein, yesterday sent two new files to the Dubai Criminal Court hearing the case of Nakheel seafront. The court adjourned the case to June 15.

The Public Prosecution had accused the executive, commercial and legal directors of harming the company’s interest by selling land at a price lower than the market. The three made a profit of Dh44.1 million.

The day before, four defendants accused of receiving bribes and harming the interest of Nakheel, told the court that they wanted to listen to prosecution witnesses, especially Dubai World accounting expert Mohammed Abdullah Al Rawahi, who compiled the audit report. The court adjourned the case to June 10.
continue reading…

Posted in Dubai court, Dubai Criminal Court, Dubai law, Nakheel | Tagged: , | Comments Off on Dubai Criminal Court fresh reports – Nakheel executives accused of receiving bribes

Dubai Debt Agreement – Nakheel faces cancelled projects

Posted by 7starsdubai on May 22, 2010

original source Bloomberg Businessweek by Zainab Fattah and Anthony DiPaola

Dubai May 21 (Bloomberg) — Nakheel PJSC, the Dubai World construction unit that received state cash to pay contractors and suppliers, may face an even greater challenge in deciding which of its planned projects to cancel.

In March, the company said it was evaluating its portfolio to identify “essential projects.” Nakheel will decide what buildings will be completed at the end of the restructuring process, a spokeswoman who declined to be named said by telephone yesterday.

Nakheel, the builder of palm-shaped islands off Dubai’s coast, is restructuring $10.5 billion of debt and has asked trade creditors to wait five years to receive full payment after falling behind on its bills. The Dubai government in March pledged to pump $8 billion in cash into Nakheel to help it pay contractors and suppliers and complete developments. Its unrealized plans include residential islands shaped like a world map and a coastal development that would be twice the size of Hong Kong Island.

http://www.businessweek.com/news/2010-05-21/nakheel-faces-canceled-projects-after-debt-agreement-update1-.html“They have to finish the projects they started and probably the working capital support has already come from the government,” Saud Masud, a Dubai-based analyst at UBS AG, said of Nakheel’s development plans. “I’d be surprised if they didn’t postpone most of the large projects that haven’t started or downscale them significantly.”

If Nakheel’s capitalization plan is approved, it would lead to a “prompt completion” of projects that are close to being finished off, according to the developer’s website.

Dubai World, the state-owned holding company that includes Nakheel among its construction, hotel and shipping assets, yesterday reached an agreement with its main creditor group to restructure $23.5 billion of liabilities. The agreement includes extending repayment dates and converting loans into equity.
continue reading

read also from the Wall Street Journal: Dubai World Debt Deal sets example for dubai,Greece-Banker

Posted in Debts dubai, Dubai World, Nakheel | Tagged: , | Comments Off on Dubai Debt Agreement – Nakheel faces cancelled projects

Omar bin Sulaiman freed in Dubai after repaying bonuses worth 51 Million Dhiram

Posted by 7starsdubai on May 21, 2010

source The National
DUBAI // The former governor of the Dubai International Financial Centre, Omar bin Sulaiman, has been released from custody after repaying Dh51.5 million (US$14m) he obtained during his tenure at DIFC, Dubai Public prosecution announced last night.

The Attorney General, Essam Eissa al Humaidan, denied earlier reports that bin Sulaiman had been released on bail.

In a press statement, Mr al Humaidan said: “Bin Sulaiman was not released on bail but was released after repayment of the amounts he acquired through issuing annual bonuses worth Dh51.5 million.” The release is covered by a recently amended law issued by Sheikh Mohammed bin Rashid, the Ruler of Dubai and Vice President of the UAE, late last year.
read more

Posted in Criminal Law Dubai, Dubai corruption, Dubai court, Omar bin Sulaiman | Tagged: , | Comments Off on Omar bin Sulaiman freed in Dubai after repaying bonuses worth 51 Million Dhiram

Dubai Court Ruling – Contract is valid if part payment taken

Posted by 7starsdubai on May 20, 2010

source Emirates Business 24-7

The Dubai Court of Appeal has directed a developer to deliver a booked unit to the buyer despite a delay in the payment of the third installment. The court ruled that if a developer receives and accepts part payment for an instalment, this will be considered an approval in principle for extension of the payment period.

A buyer signed a contract on June 25, 2007, to buy a housing unit for Dh1.3 million – a sum to be paid in six installments. He paid the first and second installments on time, and then paid part of the third installment. When he wanted to pay the remaining part of the third installment, the company accountant refused to accept the payment. The company told the buyer that the purchase agreement was null and void. The buyer transferred the remaining amount via bank remittance to the company’s account, which it received. The court saw the company’s acceptance of the payment as implied acceptance of the continuation of the contract.

Before giving the verdict, the Court of First Instance wrote to the Real Estate Regulatory Agency (Rera) to check whether the property was registered. Rera said the contract had not been registered, and the court ruled that the contract was null and void and directed the seller to pay back the money received from the buyer.

The two parties to the contract challenged the ruling, based on the fact that the contract was concluded before the issue of Law No13 of 2008.

The seller stuck to the annulment of the contract while the buyer, through his agent lawyer Mohammed Abdul Karim, also said it was valid and stuck to it.

The court said the company unilaterally annulled the contract without commitment to the steps that should be followed according to the contract – imposing a one per cent interest per each day of payment delay. And if the buyer did not correct his position within 30 days, the seller has the right to annul the contract within 14 days following the first 30 days.

The court ruled that the contract shall be implemented and that the company is obliged to pay the litigation and advocacy expenses.

Posted in Dubai court | Tagged: , , , | Comments Off on Dubai Court Ruling – Contract is valid if part payment taken

Dubai Property Investors in Dispute – Standoff between buyers and developers

Posted by 7starsdubai on May 20, 2010

source The National original reported by Bradley Hope

Kasim Hammami says he was making a speculative investment when he put a 20 per cent down payment of Dh4.8 million (US$1.3m) on an entire floor of the planned Beachfront Living tower in Dubais Waterfront development in 2007.

It was pure buying and selling of properties, the Syrian businessman said of the strategy for the company he co-founded, New Wave Investments. We would trade three or four properties a year.

But, almost three years later, that investment is at the centre of a dispute between Mr Hammami and the developer, Omniyat Properties, which has sent him a cancellation notice after he defaulted on further payments.

In a property economy that, towards the end of the boom, was dominated by both speculative developers and buyers, many disputes similar to that involving Mr Hammami have ended up in the courts and the halls of the Land Department and Real Estate Regulatory Agency (RERA). Hundreds of cancellation notices have recently been sent out by developers and the Land Department to buyers who have default.

Everyone in Dubai is pointing the finger at whats called speculators, Mr Hammami said. We all share some responsibilities, including the regulator and the developer. What I would like is fair treatment.

Property laws in Dubai have created a standoff between buyers and developers. Developers are allowed to collect 30 per cent of the value of a property before connecting the remaining payments to construction milestones.

Mr Hammami would have to pay another 10 per cent of the Dh24m he has committed to pay for four apartments, or Dh2.4m, to meet his obligations.

Meanwhile, Omniyat has only recently started construction of the tower after hiring of a contractor to install piling. RERA classifies the project as not having reached the first of five construction milestones. A report on its website from February 23 said the enabling contractor has started mobilising on site and shoring works have started.

According to an official review of the projects escrow account by Caliber Middle East, a consultancy that advises RERA, earlier this year, Omniyat sold more than 200 apartments and collected Dh314.7m.

Of that money and other funds Omniyat invested in the project, Calibers review shows, the company spent Dh237m on land payments and Dh101.6m on marketing expenses. Just Dh738,866 was spent on construction. Omniyat declined to comment last week.

Nakheel, the developer behind the entire 130-square km Waterfront project, has stopped work on it and has not yet announced a plan for future building.

How can I invest more money when the project has barely started, Mr Hammami said.

The two sides have failed to reach an agreement during the past year.

A group of investors applied to RERA to cancel the project last year but did not receive a response, lawyers said. Then, earlier this year the Land Department acted as an intermediary with an offer to lower the price per square foot, but increase the size of the apartments by 20 per cent.

Mohammed Gamal, an investor who signed up to buy a floor of Beachfront Living for Dh35m in 2008, said: Investment entails by its sheer nature the possibility of loss. But, there are principles. It cannot be acceptable under any circumstances than when an external factor like the financial crisis comes that one party wins all and other party loses all.

See also: Questions raised over cancellations

Posted in Dubai, Dubai Property dispute, Dubai Property legal | Tagged: , , | Comments Off on Dubai Property Investors in Dispute – Standoff between buyers and developers

Dubai – Property Investors formed groups to take class actions against developer

Posted by 7starsdubai on May 19, 2010

source The National

Dubai – May 18, 2010

As hundreds of investors receive cancellation notices on defaulted properties across Dubai, the consolidation of the sector is approaching its endgame.

The move to cancel contracts and repossess properties is a last resort for developers whose profits have dwindled since the financial crisis took hold, experts say.

Property developers have come under increasing pressure to know what future income they can expect to generate from units that were sold at the peak of the market, many of which are now in default.

The final notices that are now being sent to investors who have missed payments in projects that are 80 per cent or more complete marks the end of a consolidation process which, for most developers, began about 18 months ago.

“I think the auditors have come in and started to put pressure on where the receivables are coming from,” said Ian Albert, the regional director of Colliers International. “At the end of the day, a developer wants to sell. It really is a last resort to go down this route.”

Nabil Ahmed, the regional head of research at Deutsche Bank, said that after more than a year of trying to limit defaults through consolidation, some developers are now clamping down on the “20 or 30 per cent of those they couldn’t help and who are defaulting simply because they don’t have the means to pay the remaining amount”.

Still, investors who have missed payments are standing their ground because they could lose the down payments they made on investments they hoped would generate lucrative returns. Some have formed groups to take class actions against developers trying to repossess properties.

The stalemate is a result of the huge speculation that took place in Dubai’s property sector in 2007 and 2008, when prices surged 78 per cent.

“It’s basically people who were caught when the market was effectively a trade market rather than an occupier’s one,” Mr Albert said.

It was also a time when banks were happy to pair up with developers to offer attractive home finance deals.

Abu Dhabi Commercial Bank (ADCB), for example, agreed with Al Fajer Properties in 2005 to offer 60 per cent financing to customers in Jumeirah Business Centre 5.

The deal involved buyers making payments over 10 years from the project’s completion, making it appealing to those who were unseasoned investors.

Both Al Fajer and ADCB recently confirmed that the credit line, which was worth about Dh500 million (US$136.1m), was cut towards the end of 2008 as the financial crisis took hold in the emirate’s property sector.

One British investor, who asked not to be named, bought two floors of office units in Jumeirah Business Centre 5 on the understanding that she would get a mortgage.At the height of the boom in 2008, she paid 40 per cent for one floor of office space and 50 per cent on the other at Dh1,100 a square foot. She is also among the dozens of investors in the project who recently received termination notices.
“I actually have a brochure that states we’d get preapproved finance,” she said. “We paid a big premium to get the comfort of having pre-approved finance … We weren’t told until recently that we wouldn’t get it. When the market and the world economy changed, we raised this issue and were told, ‘don’t worry about it, we’ll work something out’ … We proposed to do a merger of the two floors and pay additional funds but were told ‘no’.”

Meanwhile, Jumeirah Business Centre 5, which is almost ready for handover,
has a default rate of about 85 per cent.

A senior source within Al Fajer, who asked not to be named, said:
“We have customers who did get financing; the developers also thought they were going to get financing for their projects and didn’t. We barely got any financing – 80 per cent was done with cash.”

Other property developers have also started to send cancellation notices to investors including Al Mazaya and Omniyat Properties.

Mohammed Sultan Thani, the assistant director general of the Dubai Land Department, concedes there is no clear-cut solution to the deadlock. Hundreds of termination letters have been sent out by the department in recent months, he said, and an investor who wishes to dispute a termination notice needs to go to court.

Successful sales in the auction process will also put more pressure on Dubai’s already oversupplied property market, Mr Albert added. But the process may not be entirely smooth.

“What finance will be available for people to buy at auction? You’d be looking at a very small pool of cash buyers, and they will seek very attractive prices in order to put cash into non-completed properties.”

Posted in Al Fajer Properties, Dubai, Dubai Legal - Real Estate Lawsuits, Jumeirah Business Centre | Tagged: , | Comments Off on Dubai – Property Investors formed groups to take class actions against developer

Dubai dream trip turned into a nightmare for Charlotte

Posted by 7starsdubai on May 10, 2010

source Mirror UK
Human Rights Dubai !

Staring down the police station stairs into the stinking hellhole below, Charlotte Adams retched. Just a few hours before, the young Briton had been enjoying a relaxing holiday in the sun-seekers’ resort of Dubai.

But her dream trip turned into a nightmare when Charlotte, 26, found herself flung into a filthy police cell – just for kissing a male friend on the cheek.

It was the start of six months of hell, in which she eventually begged to serve a 23-day prison sentence for “indecency” – alongside murderers and prostitutes – rather than remain in limbo in Dubai while trying to appeal.

On Friday Charlotte was tearfully reunited with her mum Lorraine, 48, after touching down at Heathrow airport.

A few hours later she was back home at Mersea Island, Essex, and hugging twin brother Chris and sister Emma, 20.

In her first interview since being released Charlotte told the Sunday Mirror: “I never, ever imagined, in a million years, something like this would happen – it just seems so unjust. It is so good to be back. I’ve thought of nothing else for the past few months. The hardest part was having my freedom taken away. I’ve been stuck in Dubai since November knowing that what I was guilty of was such a small, harmless gesture.”

Charlotte spent a hellish 23 days in a cell with eight other women – only let out to see sunlight for 20 minutes twice a week.

She had travelled out to Dubai to visit a group of British friends, after splitting from her boyfriend in London and quitting her job as an estate agent.

But a night out with pals at a burger bar sparked a police inquiry that pushed her to the brink.  continue reading

Posted in Dubai law, Tourism Dubai | Tagged: , , , , , | Comments Off on Dubai dream trip turned into a nightmare for Charlotte

Dubai seize properties from off-plan investors

Posted by 7starsdubai on May 5, 2010

original published The National – Angela Giuffrida Dubai-  Abu Dhabi 25 April

The Dubai Land Department may begin seizing off-plan properties whose owners are in default.

The authority has started notifying investors who have defaulted that if they fail to make their outstanding payments within two weeks that 40 per cent of any money they have paid so far will be confiscated, and the properties will be sold at auction.

The confiscated money, along with any profits from the auctions, will be handed over to the developers. The rule applies to projects that are 80 per cent or more complete.

The move, according to Mohammed Sultan Thani, the department’s assistant director general, is intended to spur the completion of unfinished projects. “The idea is to see what we can do before the property is cancelled,” he said.

During the property boom, many developers depended on the off-plan model, whereby a property is sold before building work starts to provide finance for construction. Many analysts say the model fuels speculative buying and inflates prices.

A number of developers, including Kuwait’s Al Mazaya Real Estate, which has eight projects in Dubai, have had such cancellation notices issued to investors.

Omar Ramaznouf, a Russian investor who has so far paid Dh10 million (US$2.7m), 60 per cent of the total price, towards 16 office units at Mazaya Business Tower in Jumeirah Lake Towers, recently received one of the Land Department’s notices.

Mr Ramaznouf, who has not made any payments on his development since December 2008, was told in the letter that the developer would be allowed to “sell the related unit[s] by auction in conformity with common regulations, and with the price asked for by the developer in addition to expenses”, unless he paid the next 20 per cent instalment within two weeks.

The final instalment is due when the properties are handed over.

Mr Ramaznouf said he has been unable to pay some instalments because of “cash-flow problems” brought on by the financial crisis. He has been trying to extend his payment plan with Al Mazaya, according to Medhi Guliyev, his business partner.

“But now he’s being told ‘you don’t own this property anymore,’” said Mr Guliyev.

George Ezman, a businessman from the Czech Republic who bought several office units in Jumeirah Business Centre 5, a project by the Dubai developer Al Fajer Properties, has received a similar notice. He has paid 30 per cent of the total cost and is due to pay the remainder on completion.

Mr Ezman complained, however, that the developer breached its agreement by delivering the property more than a year late.

He said that, according to his contract, he had the right to cancel the contract and receive a refund if the property was late.

The building was supposed to be finished in 2008, he said. “I’m not paying any more because the agreement to cancel our contract and get a refund has been ignored. This, along with the fact that they can take our money and keep our property, is insane.”

Spokesmen for Al Mazaya and Al Fajer were unavailable for comment yesterday.

Lawyers working for investors such as Mr Ezman say that while the Land Department can issue cancellation notices, a property agreement can only be officially cancelled by the courts.

Mr Thani said the authority had yet to auction any properties and did not believe there would be many such cases. “Very few people will opt for not completing payments if the building is almost ready.”

Posted in Al Fajer Properties, Dubai, Dubai Legal - Real Estate Lawsuits, Dubai Properties, Real Estate Scandal Dubai, Rera Dubai, Sheikh Maktoum Al Maktoum | Tagged: , , , , | Comments Off on Dubai seize properties from off-plan investors

%d bloggers like this: