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    • 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 […]
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Archive for the ‘Dubai Debts’ Category

Dubai Drydocks World default case won by US Hedge Fond in UK

Posted by 7starsdubai on March 14, 2012

 Monarch Capital US Hedge Fond  has won a judgment against Dubai’s Drydocks World for last year’s debt default, in the first high-profile case of a Dubai state company being successfully pursued overseas for its debt.

The US hedge fund, which holds $45.5m of the Dubai ship repair company’s debt, took the case to the UK high court. Last week Drydocks World said it had presented a plan to lenders to restructure $2.2bn in loans and extend repayments over five years, Financial Times reported.

continue reading original source Financial Times

Posted in Drydocks World Dubai, Dubai Debt Lawsuit, Dubai Debts | Tagged: , , | Comments Off on Dubai Drydocks World default case won by US Hedge Fond in UK

Dubai Real Estate Dispute Lender has the right to hold debtor ´s passport

Posted by 7starsdubai on June 23, 2011

Dubai Court of Cassation issued the legal principle in the case of a foreigner who works as a Director at a real estate brokerage firm, which prevented him from travelling, after he allegedly embezzled Dh14 million.

The investor had filed a lawsuit before the Dubai Court of First Instance, requesting it to allow him to hold the director’s passport.

The investor claimed that he had handed over two cheques worth Dh14m to the company manager in return for booking a real estate unit in a tower. But he was surprised to learn that the real estate brokerage company sold that unit to another investor.

After several rounds of discussions, it was agreed between the parties that the manager of the company (the defendant) pledged to refund the amount. However, he did not comply with the deal, the investor told the court.

Meanwhile, the investor moved the court to grant him the right to with hold the passport of the defendant so that he did not leave the UAE.

source EMIRATES BUSINESS 247 …….continue reading

Posted in Dubai court, Dubai Debts, Dubai Fraud, Dubai Legal - Real Estate Lawsuits, Dubai Property dispute | Tagged: | Comments Off on Dubai Real Estate Dispute Lender has the right to hold debtor ´s passport

Dubai canceled 217 Registered Real Estate Projects

Posted by 7starsdubai on June 13, 2011

217 Real Estate Projects canceled by RERA Dubai

Dubai continues to struggle with its real estate woes, the latest sign that things are not yet quite set to improve comes with the report that Dubai’s real estate watchdog organization has canceled around 217 registered property projects since 2009[. The Dubai Real Estate Regulatory Authority  (RERA), reviewed about 450 projects in the emirate and may have canceled as many as 217, although it admitted that 237 would likely be completed “in due course.”

Last year, the value of property transactions fells to 119.5 billion dirhams ($32.5 billion) from 152.9 billion dirhams in 2009, and residential prices in the region are still falling with declines of 1.2 percent in May.

Home prices are down 64 percent from their mid-2008 peak

Posted in Dubai, Dubai Debts, Dubai Real Estate Scandal, Property Investor Dubai, Rera Dubai | Tagged: , , , | Comments Off on Dubai canceled 217 Registered Real Estate Projects

UAE Developer Al Murjan Real Estate files bankruptcy

Posted by 7starsdubai on November 25, 2010

Al-Murjan Real Estate LLC, United Arab Emirates company equally owned by Umm Al-Quwain’s deputy ruler, Sheikh Abdullah bin Rashid Al Mualla, and Al Khalijia
Investments LLC, cited failure to get government approval for the project and defaults by “nearly 50 percent of the buyers.

Al Murjan Real Estate the owner of White Bay, an 8,000-home community in the Emirate of Umm Al-Quwain, filed for bankruptcy in a federal court and two liquidators have been appointed following a lawsuit brought by one of the owners, according to documents provided by Ludmila Yamalova, a partner at HPLYamalova & Plewka JLT representing three buyers in White Bay.

Read More Financial Times

Posted in Dubai Debts, Real Estate Scandal Dubai | Tagged: , , , , | Comments Off on UAE Developer Al Murjan Real Estate files bankruptcy

Nakheel ask for discount to pay debts

Posted by 7starsdubai on November 23, 2010

source Arabian Business

Nakheel, the debt-laden real estate arm of Dubai World, is offering trade creditors early payment on outstanding debts in exchange for a cut on the amount due.

UAE conglomerate Easa Saleh Al Gurg Group, whose industry arm supplies materials to the construction sector, said Nakheel had pushed to renegotiate its debts with trade contractors, in exchange for a quick settlement.

“‘Give us a discount and we will finish your payment upfront,’ that is what [Nakheel] has got to say,” Abdullah Al Gurg, group general manager, told Arabian Business. “In some cases, yes they have [tried to renegotiate debts].

Nakheel did not respond to requests for comment on the matter.

Posted in Dubai Debts, Nakheel | Tagged: | Comments Off on Nakheel ask for discount to pay debts

Journalist and Press blamed by Dubai Rera chief

Posted by 7starsdubai on October 15, 2010

source Kippreport – Its all our Fault- by Eva Fermandes

It seems everyone’s favourite scapegoat has yet another cross to bear. A recent statement from a RERA official has blamed irresponsible reporting by the media for the “damage” suffered by Dubai’s real estate industry.

Speaking at a conference, RERA (Real Estate Regulatory Agency) official Marwan bin Ghalita said, “The real estate sector in Dubai has been hurt by the journalists and media publishing incorrect data on the market.

The media is blamed for rising real estate prices… as correct data has never been published… They did not check the accuracy… did not get the correct information which is one of the prime foundations for making any decision. Journalists did not approach official sources to get the right picture.”

Ironically, Ghalita’s comments come amidst reports of four companies suing Nakheel subsidiary The World on account of a breach of contract. Construction of The World, one of Nakheel’s most expensive and ambitious projects that consists of reclaimed islands built to resemble a map of the world, has stalled since the financial crisis. The claims filed against The World by three Sharjah based companies (Global Realty Partners, Gulf Developers and Frontline Developers) amount to a total of $15.3 million (Dh56.19m).

I find it interesting that, in light of court cases like this, some still see fit to blame the media for the mess that is the Dubai property sector. Perhaps the unrealistically ambitious and greedy property developers could take a smidgen of the blame as well?

I remember the days when huge construction projects were being announced on a monthly basis. In fact at the peak of the real estate boom, Emirates 24/7reports Dubai had over 850 registered developers; a figure that has slipped
down to a more sober 500 over the past couple of (humbling) years. In addition to the overabundance of developers, we clearly had too many projects. Emirates 24-7 observes that the Government of Dubai’s bond prospectus, filed at the London Stock Exchange, suggests that a total of 495 registered property projects have now either been cancelled, are
in the process of being cancelled, or have work which has been otherwise stopped.

Don’t get me wrong, I don’t think the media can claim to be completely innocent (we were too eager to believe in the Dubai dream, and too timid to question the crazy growth), so we aren’t that surprised with RERA’s convictions. But after the judicial, legislative and executive branches, the media has been accused of being the fourth branch of the government (thanks to its softly-softly approach to the Dubai economy and government). If anyone believed that, the ease with which we now shoulder the blame should make them re-think.

The media constantly comes under fire for pretty much everything: the Iraq War, the onset of teenage depression, the status of woman’s body image, to name just a few. The slow speed at which paint dries is probably our fault somewhere along the line as well. Often these accusations are welcome, as they are maliciously motivated and imply we
are (to some degree) fulfilling our role of watchdog. But for RERA, there are surely more productive ways it can invest its time.

Posted in Dubai Debts, Dubai Legal - Real Estate Lawsuits, Dubai Property dispute, Dubai Property Investors, Marwan bin Ghalaita, Rera | Tagged: , , | Comments Off on Journalist and Press blamed by Dubai Rera chief

Dubai cancelled 50 per cent of property projects

Posted by 7starsdubai on October 6, 2010

source Arabian Business
Dubai’s government cancelled almost half of the real estate projects planned in the emirate after the credit crisis caused demand to collapse and a housing glut drove down home prices.

Out of 980 registered projects, 495 were scrapped or are in the process of being cancelled by the emirate’s Real Estate Regulatory Agency the government said in a bond prospectus posted on the London Stock Exchange website on Monday.

Posted in Dubai Debts, Dubai Property Investors | Tagged: , , , | Comments Off on Dubai cancelled 50 per cent of property projects

ACI Dubai Funds filed bankruptcy in Germany

Posted by 7starsdubai on September 14, 2010

source nw-news

Gütersloh / Bielefeld, Germany (dpa).

Several companies from real estate funds in Dubai, under the umbrella of the Gütersloh investment company ACI have registered on Friday for bankruptcy.  In this act it is the companies of the Fund II to V and the ACI IV Beteiligungs GmbH, said the district court of Bielefeld. A temporary administrator will probably determined on Monday, it said.  File number has not yet been awarded.
The company had previously announced bankruptcy.  ACI-founder Uwe Lohmann had stressed that the reason is the falling price of real estate in Dubai.
continue  reading original text in german ….

Full report update source The National September 14, 2010

Berlin // German prosecutors have confirmed they are investigating
the management of Alternative Capital Invest (ACI), the biggest German
property investment fund in Dubai, amid allegations of fraud. The
company had declared bankruptcy on four of its investment funds.

An investigation has been launched against executives of the company ACI
for alleged capital investment fraud and breach of trust,” Heinrich
Rempe, a senior prosecutor in Bielefeld, western Germany, told The
National last night.

The company set up investment funds in Germany with the purpose of
entering into investments in Dubai. The investigation is focusing on
alleged false information given in the prospectus the company issued
for its funds.

Mr Rempe said ACI had a total of seven investment funds and that four of them, numbered II to V, had filed for insolvency. He said the investigation had been going on for several months.

“The probe is still at an early stage,” Mr Rempe added.

ACI declined to comment.

Accordingto Handelsblatt, a leading German business newspaper, ACI had collected about €210 million (Dh1 billion) from about 6,000 investors in its
various funds to invest in constructing high-rise developments in

Handelsblatt said Bielefeld prosecutors were investigating the founder of ACI, Hanns-Uwe Lohmann, and his son Robin, and that ACI’s headquarter in the western German town of Guetersloh had been searched in June.

Mr.Lohmann has denied the allegations. German media quoted him as saying the projects ACI had invested in were unfinished and the slump in Dubai property prices had forced the company to make “unavoidable balance sheet write-downs of the book values.

Mr Lohmann has resigned as the chief executive of ACI.
ACI is engaged in several development and property projects in Dubai and was best known for its concept of “tower branding”.

The fund company was planning towers named after celebrities such as
the Formula 1 drivers Michael Schumacher and Niki Lauda, and the tennis
champion Boris Becker. Huge advertisement campaigns ran throughout Dubai until 2008 before the property market reached its peak.ACI
told investors in a recent letter that while its Dubai Fonds II to V
had declared bankruptcy, the latest funds Dubai Fonds VI and VII had
not. Fonds I had been closed at an earlier date, and €13.5m had been
paid out to investors.Media reports said ACI had expected to realise projects worth more
than €600m in Dubai before the financial situation deteriorated.

developments include the Dubai Star tower in Jumeirah Lake Towers for
which a new contractor is being sought, according to a statement by ACI
Real Estate in Dubai.
The Q Sami tower and Victory Bay in Business Bay are also seeking new contractors. The PKS Residences and the Mayfield Gardens projects in Jumeirah Village have been put on hold, along with the Niki Lauda, Boris Becker and Michael Schumacher towers and the Wings of Arabia project in Dubailand.

Progress on the Ferretti and Pershing Beach Residences on Waterfront
have also ground to a halt, although they were slated for completion by
next year.

ACI claims that some of the projects have already been sold.
Earlier this year, ACI tried unsuccessfully to sell other assets as potential
buyers cancelled deals. Mr Lohmann blamed this on “intrigues” by
competitors and unfavourable reports in the media.

Posted in ACI Immobilienfonds, ACI Lohmann Dubai, Dubai Debts | Tagged: , , | 1 Comment »

Dubai Debtors Prisons – Legal System on trial

Posted by 7starsdubai on August 11, 2010

source Bloomberg

Reporter on this story: Henry Meyer in Dubai at hmeyer4@bloomberg.net; The editor responsible for this story: Peter Hirschberg

Not long ago, British businessman Ryan Cornelius was living the high life, doing deals out of Bahrain and taking his family big-game fishing on his yacht and on safari in Kenya. He’s now into his third year in a Dubai jail cell, yet to be convicted of anything.“The worst aspect of the way we’ve been treated is the fact that the legal system seems to be so suspended in its own inefficiency,” he said from a pay phone at Dubai’s Central Prison. “We just don’t seem to move forward. The whole legal system seems to hold you in a state of constant suspension.”

Cornelius, 56, and six co-defendants have been charged with defrauding Dubai Islamic Bank PJSC of $501 million, one of the largest such cases in the history of United Arab Emirates. He says he did nothing wrong, and like others, foreigners and nationals, who profited in Dubai in the boom times, he waits in prison as the legal system slowly tries to separate the guilty from the innocent of those
arrested in an anti-corruption drive.

Dubai’s image as the Singapore of the Middle East, a global hub for finance and tourism, is being tested as it tries to clamp down on excesses such as fraud and over development, which came with an explosion of people and investment. Its judicial system still often has more in common with its regional neighbours than the Western nations that it aspires to emulate, say lawyers and economists who work there.

The government won’t say how many people have been arrested in the two-year campaign against financial corruption. Detained in Dubai, a London-based lobbying group, says several hundred executives may have been jailed.

Debtors’ Prisons In all, about 40 percent of the 1,200 people in Dubai Central Prison have been convicted of defaulting on bank loans, Human Rights Watch said in a report in January. Even after completing their sentences, the New York-based group said, prisoners are likely to remain in jail until their debt is paid off, unlike in the U.S. or the

U.K., where debtors’ prisons were abolished in the 19th century.

continue reading

Posted in Dubai court, Dubai Debts, Dubai Justice | Tagged: , | Comments Off on Dubai Debtors Prisons – Legal System on trial

Bankruptcy in Dubai

Posted by 7starsdubai on August 9, 2010

The shaky financial status of a company in Dubai

source Emirates 247

The Dubai Cassation Court has issued a principle stating that failure to pay one commercial debt is sufficient to declare a company bankrupt.

The court has based the principle on the Commercial Transactions Law, which states that to declare a company bankrupt, failing to pay a number of commercial loans is not the provision, but failing to pay only one debt is sufficient as it implies a shaky financial status.

The law also allows the creditor of a limited liability company to ask the court to declare a company bankrupt if it fails to pay a mature debt.

The court issued this principle after hearing a dispute between two companies one of which asked the court to declare the second bankrupt, red seal it and appoint a judicial guard to manage it and preserve its money.

The company said in its complaint that it had obtained a judicial ruling regarding its entitlement for the credited amount of Dh921,000 in addition to the legal profits.

The court found that other creditors are asking for their money and for the seizure of the respondent company’s money.

The respondent company has no location and activity, which clearly proves that it will not pay debts upon maturity. The situation shows the shaky financial status of the respondent company, which subjects its creditors to a real risk that deems declaring it bankrupt.

The Court of First Instance had turned down the case. The Court of Appeal had also upheld the verdict of the Court of First Instance.

The Court of Cassation rejected the verdict and accepted to hear the case again.

The Court of Cassation said in its statement that the respondent company is still, and without any right, not paying commercial debts despite of their maturity. There are also seizure claims by other creditors filed against the company.

Besides, criminal cases were filed against its director for issuing bad cheques that landed him in jail.

The court cannot consider having the partner in jail as a reason beyond his control, but rather it was the result of a deed he has committed: signing bad cheques, the court debated.

All these are sufficient evidences about the shaky financial status of the company that subject its creditors to real risk, concluded the principle by the Court of Cassation.

Posted in Dubai court, Dubai Debts, Dubai Justice, Dubai Legal - Real Estate Lawsuits | Tagged: | Comments Off on Bankruptcy in Dubai

Dubai World Debt Talks July 2010

Posted by 7starsdubai on July 25, 2010

source Wall Street Journal

Despite the support of Dubai World’s major creditors the mood of
bankers leaving the meeting was mixed. All one executive had to say was
that “the food was good”, while many others simply rolled their eyes and
frowned when asked if anything positive had come from the day.
Suresh Vaidyanathan, head of operations at Bahrain-based Alubaf Arab
International Bank, told reporters on leaving the session that he wasn’thappy with the terms of the proposal. “We are not happy,” he  said. “The pricing is low. The backing of the U.A.E. government
guarantee is not as per British law and anything can happen. We have to
depend on their cashflow coming correct.”…

Posted in Dubai, Dubai Debts, Dubai World, Nakheel | Tagged: | Comments Off on Dubai World Debt Talks July 2010

Nakheel Dubai starts Payment to Creditors

Posted by 7starsdubai on June 30, 2010

source businessweek

Nakheel PJSC began making payments to its biggest contractors as the Dubai World-owned property company seeks to alter terms on $10.5 billion of unpaid bills and loans amid falling property prices in the emirate.

Nakheel started making 40 percent cash payment to trade creditors, according to a company statement today. “The announcement marks significant progress in our recapitalization plan following on from the initial payments to trade creditors of 500,000 dirhams or less which commenced in March.”

Nakheel, the builder of palm-shaped islands off Dubai’s coast, said in March that trade creditors would be offered 100 percent recovery of their claims — 40 percent through a cash payment and 60 percent through a publicly tradable Islamic bond, paying 10 percent return annually. The Dubai government in March pledged to pump $8 billion into Nakheel and said it will take over its ownership from Dubai World after the restructuring. ….continue reading

Posted in Dubai Debts, Dubai World, Nakheel | Tagged: , , | Comments Off on Nakheel Dubai starts Payment to Creditors

Dubai World is expected to make a formal request for debt standstill

Posted by 7starsdubai on December 20, 2009

source Kippreport

Dubai World, a government-owned conglomerate, is expected to make a formal request for a debt standstill on $26 billion at a creditor’s meeting on Monday, reports Reuters. Bankers tell the news agency it could take over a month for the request to be approved.

“You can’t bet on it, because anything could happen; it could be anything from a complete write-off to 100 percent recovery,” a senior banker said.

The meeting is schedule for 12.30pm on Monday at the conglomerate’s headquarters.

“We’re going to pitch up, hear what they say, give our views, wait for the formal extension request and work on a restructuring,” a Dubai-based banker close to the talks said.

Read also from Reuters ” Scenarios – Creditors likley to agree Dubai World standstill “

Powered by ScribeFire.

Posted in Dubai, Dubai Debts, Dubai World | Tagged: | Comments Off on Dubai World is expected to make a formal request for debt standstill

Who is carrying the risk – Dubai’s unfinished construction projects is in the hundreds of billions of dollars

Posted by 7starsdubai on December 18, 2009

extract of original TheDailyMarverick

Some say the sum for Dubai’s unfinished construction projects is 400 billions of dollars , so who is carrying the risk?

Multiple reports state that Abu Dhabi will “pick and choose” how to assist Dubai.

As capital of the United Arab Emirates and home to the central bank that feeds the cluster of seven emirates, everybody is exposed to everyone else. Abu Dhabi pumps 90% of UAE oil, so that’s a big hedge. But just as Dubai World has subsidiary upon subsidiary, and extends its tentacles into state enterprises, parastatals, and listed firms, it’s hard to track where the fault lines lie in the patchwork that is UAE finances, and beyond into the markets of the Middle East proper.

Abu Dhabi’s own cost of insuring its debt against default has soared, from just less than $100,000 per $10 million, to more than $177,000. And while this number fluctuates with the desert winds, there’s no guarantee that Abu Dhabi will keep forking out money to save its emirate cousin. For now, though, the prospect of rising costs on its own borrowings appears to have galvanised Abu Dhabi into providing more cash to Dubai. Stock markets swelled after Abu Dhabi’s payment of $10 billion to its neighbour, with Abu Dhabi’s stock market clambering 7.9%, while Dubai’s benchmark index rallied 10%, the biggest single-day gain in more than a year. But this remains far below its level before Dubai World announced it wanted a hold on debt.

Reuters quotes Abu Dhabi people who say most of the über-emirate’s credit flow was too big, government-backed entities in Dubai, which helped collateralise Abu Dhabi’s own late entry into the wedding-cake architectural stakes.

“During those years, the property market was still in its infancy in Abu Dhabi, so like other banks here, we, too, diverted our credit to Dubai,” one Abu Dhabi bank executive said. “We have to face the stress that will be caused to our balance sheet and profit and loss account due to this exposure to Dubai World and associated companies because it is a default. Yes, we will have to take more provisions.”

No one yet knows where the debt really resides.

Western banks appear to have some $12 billion of exposure to Dubai’s unfinished building frenzy.

There’s a sprinkling of Islamic sukuk bonds, such as the one that funded Nakheel’s $4.1 billion of due debt.

But the market wants to know if Abu Dhabi’s latest $10 billion was a gift, or a loan, or came from the proceeds of a veiled asset sale.

Abu Dhabi recently launched a push to improve transparency and raise money overseas, to help fund its own 20-year development programme. And so far, the emirate has raised about $8 billion this year on international credit markets.

But last week, ratings agency Moody’s placed the credit ratings of several big Abu Dhabi companies on review for a possible downgrade, citing uncertainty over government support. And in the meantime, rival agency Fitch downgraded Dubai Bank, and also Tamweel – the largest provider of UAE real estate financing. It also downgraded Bahrain’s TAIB Bank.

Another motivation for Abu Dhabi helping out Dubai World is the company’s Dubai port operations, which it needs to market as a dependable global transport hub.

Dubai has got off lightly to date. But if the property market doesn’t return soon, hundreds of billions of dollars worth of skyscrapers and palm-shaped islands will remain unfinished hulks amid the dunes and warm waters off Dubai’s coastline.


Read more: Barrons, Reuters, Guardian, The Wall Street Journal

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Sheikh Mohammed Ruler of Dubai has told the emirates`s critics to ” Shut Up”

Posted by 7starsdubai on November 10, 2009

original source 7Days
Dubai Ruler tells critics to ‘do their homework’ as he stresses unity and confidence in the future

The Ruler of Dubai has told the emirate’s critics to ‘shut up’.

HH Sheikh Mohammed bin Rashid Al Maktoum yesterday broke away from a pre-prepared speech in Arabic on the Dubai economy to make his point in English.

His remark was directed at people who have tried to suggest there is a wedge between the emirates of Dubai and Abu Dhabi after Dubai drew a $10 billion emergency loan from the UAE central bank.

But Sheikh Mohammed said these people “should really do their homework” about his country.

“I just want to tell these people who nag about Dubai and Abu Dhabi to shut up,” he told the MENA and Frontiers Conference in Dubai, organised by Bank of America Merrill Lynch.

Sheikh Mohammed, who is also the prime minister and vice president of the UAE, stressed the close ties between Dubai and Abu Dhabi.

“Dubai and Abu Dhabi are one,” he said, adding: “I assure you that we’ll be there for each other when we need it.”

The comments were clearly aimed at dispelling perceptions of a rivalry between the two emirates.

There have been accusations around the globe that Abu Dhabi has become jealous of Dubai’s success in recent years as it tries to diversify its economy away from a dependence on oil.

But yesterday, in rare public comments on the subject, Sheikh Mohammed stressed the tribal bonds and blood relations between the emirates’ rulers.

“We, our fathers, grandfathers have fought for the Arabian Peninsula,” Sheikh Mohammed said. “We are very, very proud of our country, very proud of our people… And our people (are) very proud of us.”

The ruler also confronted critics who say Dubai was slow to react to the global financial crisis.

He said the government “preferred to wait rather than rushing” so it could restructure state-owned companies. And Sheikh Mohammed said he
was confident the worst of the crisis was over.

“As the global economy stabilises, Dubai today is well placed to exploit its inherent strength,” he said.

“The slowdown will never dampen the mettle of children of Dubai to steam forward in the drive toward development,’’ he added.

Dubai faces a debt of about $80 billion. As well as the $10 billion loan, it expects to raise an additional $10 billion in financing before the end of the year.

more Maktoob.com

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Western realty investors turning away from Dubai an the Gulf

Posted by 7starsdubai on September 6, 2008

Western realty investors turning away from Gulf

Western investors have cooled on Gulf property markets, leaving the scene for local billionaires at least until global credit conditions ease – or markets in the region become more open and predictable.

In Dubai, Abu Dhabi and Kuwait, it is domestic investors who are again calling the shots in real estate, now that debt-starved British and United States property buyers have refocused on other areas they see as cheaper and more competitive.

“Given current economic conditions, US and British institutions are taking a lot of convincing to splash out in the Gulf,” said Fadi Moussalli, a director in Jones Lang LaSalle’s Dubai-based International Capital Group.

“There is less enthusiasm for Gulf property because foreigners are busy dealing with crises elsewhere,” Moussalli said.

Before the credit crunch, Western property buyers were making good progress in opening up fledgling Gulf property markets. But the balance of power has shifted back to local businessmen and their wealth.

Citing data from emerging markets researcher Reidin, Jones Lang LaSalle said less than a fifth of real estate purchases in Dubai in 2008 so far were made by European or US investors.

“A lot of people are [still] looking in the Middle East but it tends to be dominated by local capital,” said Charles Graham, a principal at property fund manager Europa Capital. “There is a lot of it [local investment cash] and the return requirements are for the most part less demanding than our own,” Graham said, adding he was not tempted yet to break away from Europa’s core markets to gain a foothold in the Gulf.

Capital constraints and worries at home are not the only issues driving western investors away from the Gulf. Some believe prices in hotspots like Dubai are close to peaking after years of sky-high growth, while others feel precious capital can earn higher yields closer to home.

House prices in Dubai, which have surged almost 80 per cent since the start of 2007, were likely to fall 15 per cent after a 2009 peak as massive increase in supply overwhelms demand, a Reuters poll showed.

Others are concerned that a clutch of measures to combat property price inflation, such as rental caps, trading restrictions and proposals for a property capital gains tax have made Gulf property investment risky.

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