7StarsDubai

Dubai UAE News from the Press Property Market Disaster and More

  • Dubai 7 Stars
  • August 2018
    M T W T F S S
    « Dec    
     12345
    6789101112
    13141516171819
    20212223242526
    2728293031  
  • 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

    • 479,063 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.

Posts Tagged ‘RERA Dubai’

Investors of dealyed Dubai Sports City file a petition to the Dubai Land Department

Posted by 7starsdubai on September 11, 2012


Hundreds of investors in the massive delayed real estate projects at Dubai Sports City (DSC) are to hand in a petition to Dubai Land Department urging authorities to audit the project and investigate delays by third-party residential real estate subcontractors. According to the investors’ petition, they claim “what we have is a half built sports city, with many building plots standing abandoned and investors chasing non-existent developers to try to get their money.”

 

The Petition RERA Dubai Help us :

We are the 2005/07 Investors of Dubai Sports City.

Many of us wanted a holiday home in Dubai for our families and before that we were part of the successful Tourism Industry that frequents Dubai every year. Some of us were planning to make Dubai our new home. We are not gamblers or speculators that invested beyond our means.

Our money was supposed to be protected by the escrow accounts. We were promised stadia and infrastructure. It is now 2012 with no end in sight…

The Developers have defaulted on mass scale since according to our contracts our projects were supposed to be completed between 2008 and 2010. Until today we have not received any request for an extension of our contracts and no explanation about why the projects have been stalled. Many of us were asked for more money and some of us were told that the construction was in progress when it was not. Many projects have stalled for years, but those Developers are still allowed to hold our money until “the market improves”. Despite numerous contacts with RERA our rights have not been upheld. Furthermore RERA is delaying the cancellation of non-vital projects. We feel that this  inaction has an additional negative impact on the Dubai economy and more precisely on its real estate market.

It is our belief that if RERA applied the law equally to Developers and Investors, we would be allowed to choose to receive refund of our money as per our contracts and could then reinvest the money in viable projects. If the Developers have misused the money they should be penalised according to the law.

We, the undersigned hope for the best future of Dubai. As Investors in Dubai we ask:
1. The Government to stop the Developers demands for additional payments beyond those already contracted;
2. To provide every Investor with escrow/trust fund/invested money information in every project in DSC so Investors can make informed decisions,
3. Create new escrow accounts for new payments,
4. Require the Developers to use the money already invested into the projects to complete them;
5.Mediate disputes between investors and Developers and come up with practical solutions -don’t send everybody to courts.

Click here to sign the Petition

Posted in Dubai, Dubai Property Investors, Dubai Property refund, Dubai Real Estate Scandal, Dubai Sports City, Petition Rera Dubai, Real Estate Dubai, Rera Dubai | Tagged: , , , , , | Comments Off on Investors of dealyed Dubai Sports City file a petition to the Dubai Land Department

Dubai property investors can seek refund and damages from developer

Posted by 7starsdubai on June 24, 2012


Draft Investor Protection Law released by Dubai Land Department for feedback from public. The intending investor, the draft law proposes, shall be entitled to recover compensation from whoever of the developer, investor or broker shall have caused the loss.
source Emirates 24/7

Developer’s failure to complete or handover a property within a certain timeframe from date specified in the sales contract, deliberate intention of defrauding an investor or altering the specifications of the unit without obtaining requisite permission will soon allow investors to recover all the amount by them, Emirates 24/7 reported.

The draft law regarding the protection of the real estate investor in Dubai was released on Wednesday (June 20) to get feedback, for the first time, from people involved and concerned with real estate investment in the emirate. The department will be receiving feedback until June 29.

However, it is not known when the law will be actually implemented. But in April, Sultan Bin Mejren Director General of Dubai Land Department, said the law was expected to be implemented by end of June.

continue reading original source Emirates 24/7

The Draft of the Law can be read/ download pdf  here dubailand.gov.ae

Click here to give a feedback to the Dubai Land Department

Posted in Dubai property compensation, Dubai Property Investors, Dubai Property refund, Dubai Real Estate, Rera Dubai | Tagged: , , , , | Comments Off on Dubai property investors can seek refund and damages from developer

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

Dubai real Estate development cancellation rise to 500 RERA said

Posted by 7starsdubai on May 15, 2011


source Arabian Business 

The number of real estate developments in Dubai facing cancellation this
year has risen from 300 to 500, the emirate’s property watchdog Rera Dubai said.

Marwan bin Ghalaita from RERA Dubai told Arabian Business:

“We have finished the technical review, site visits have already been
done, so we know what stage the projects are at and the strength of the
contractor. Now we’re waiting for the financial audit to finish and we will release the names [of the cancelled Dubai Property projects] very soon.”
continue reading……

Posted in Marwan bin Ghalaita, Real Estate Scandal Dubai, Rera Dubai | Tagged: , , | Comments Off on Dubai real Estate development cancellation rise to 500 RERA said

RERA Dubai – 90,000 units face cancellation

Posted by 7starsdubai on April 7, 2011


Dubai April 7, 2011

In an interview with XPRESS, Marwan Bin Ghalaita, CEO of Dubai’s real estate regulatory agency, confirmed that 257 projects were under review, many of which were yet to even start construction.

He added that when assessing a project’s viability, RERA would be looking particularly at the ability of contractors and developers to deliver the project.

Last year, RERA cancelled 202 projects where little or no construction had taken place or where buildings were located far from the city’s main infrastructure

 

Posted in 7starsdubai, Dubai Real Estate Scandal, Marwan bin Ghalaita, Rera Dubai | Tagged: , , | Comments Off on RERA Dubai – 90,000 units face cancellation

Dubai Rera has only 1.36 Billion left in escrow account

Posted by 7starsdubai on December 8, 2010


Dubai’s Real Estate Regulatory Agency has only 5 Billion dirhams ($1.36 billion) remaining out of 7 billion dirhams originally deposited in escrow account it manages on behalf of buyers of yet-to-be-built properties, Arabian Business reported, citing Marwan bin Ghalaita, head of the regulatory body

RERA, which oversees the account and disburses money to developers during construction, has barred payments except those directed to contractors to pay for construction, the Dubai-based magazine said, citing RERA chief Marwan Bin Ghalita.

Read also: You will see a lot of cancellations in 2010 – Marwan bin Ghalaita

and      There is a limit to transparency – Marwan bin Ghalaita CEO RERA Dubai

Posted in Marwan bin Ghalaita, Real Estate Scandal Dubai, Rera Dubai | Tagged: , , , | Comments Off on Dubai Rera has only 1.36 Billion left in escrow account

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

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 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 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

Dubai Property Law 13 on the way

Posted by 7starsdubai on March 19, 2010


source CraneCountry The National
Key changes are detailed after the jump…

From Hadef’s website: http://www.hadefpartners.com/News/pageid/120-137/default.aspx?Mediaid=124

§         The Regulations make it clear that a developer needs to only submit an application to register units under Article (3)(2) of Law 13 within the specified time in order to comply with the registration requirements. Applications made outside this time will still be registered but a fine of AED10,000 will be levied.

§         Developers cannot sell off-plan before taking possession (which includes actual control of the land) and only after obtaining the site location plan along with all necessary approvals from the competent authorities for the project.

§         Parking lots must be registered along with the purchasers’ units.

§         The developer cannot refuse to transfer units if the purchaser has fulfilled his contractual obligations even if the purchaser owes other financial obligations not arising out of the particular sales contract.

§         Developers who wish to sell using real estate brokers must conclude a contract with a registered broker and have that contract registered with the DLD.

§         Sales of units in projects that have not been fully approved by the authorities are void.

§         Where brokers market all or part of the project the broker must place all sums received against the purchase price for the unit in the escrow account and cannot deduct monies for brokerage until after payment into the escrow account. Any contract that allows otherwise shall be void.

§         The DLD has the authority to act as a mediation service for disputes between developers and purchasers.

§         Further clarity is given on the procedures for terminating purchasers. Developers appear to now be able to send their own termination notices (i.e. not through the DLD) provided they copy the notice to the DLD. A developer does not need to sell at public auction if he completes more than 80% of the project and may elect to terminate the contract and retain up to 40% of the purchase price.

§         A developer can only rescind a contract with a purchaser where construction has not started provided the developer proves he has fulfilled all his contractual obligations and proves the project was not initiated due to causes beyond his control and the failure was not due to his negligence.

§         Leveling and infrastructure works are evidence that a developer has started a project.

§         A developer may make use of or let a unit to a third party if the unit is not auctioned subject to the developer repaying any balance sums due to the defaulting purchaser in accordance with the timeframes set out in the Regulations.

§         A purchaser can request the courts to rescind a contract in the following cases:
(i)   if the developer refuses to deliver the contract for the unit without any justifiable reason;
(ii)   if the developer does not bind payments to construction based milestones as approved by the DLD;
(iii)  if the developer significantly changes the specifications agreed in the contract;
(iv)  if the unit is proved to be unusable due to major structural defects;
(v)   in any other cases applicable under general legal rules.

§         For the purposes of the Regulations causes beyond the control of a developer include:
(i)   the plot on which the project is to be built is re-possessed for public interest;
(ii)   if a government authority stops the project for re-planning;
(iii)  if excavations or service networks are found in the project’s location;
(iv)  if the master developer modifies the project’s location in a way that prevents the sub-developer from executing its obligations;
(v)   any other causes as deemed by the DLD.

§         Negligence by a developer includes:
(i)   delay in taking handover of the plot and obtaining necessary approvals from the competent authorities without any reason;
(ii)   sub-developer sells off plan without obtaining permission from the master developer;
(iii)  delays in obtaining written approval for plans and designs;
(iv)  delays in preparation of the project for actual construction works;
(v)   not providing the DLD with necessary information required to approve the project;
(vi)  non registration of project with DLD;
(vii) non disclosure of the project’s financial data to the DLD;
(vii) any other causes as deemed by the DLD.

§         The DLD can cancel a project on the basis of a technical report in the following cases:
(i)   the developer does not initiate construction without justifiable cause after obtaining the required approvals;
(ii)   the developer breaches Dubai Law 8 of 2007 (the Escrow Law);
(iii)  the DLD finds the developer not serious about constructing the project;
(iv)  the land on which the project is to be built is re-possessed due to breach by the sub-developer of its contractual obligations towards the master developer;
(v)   the land on which the project is to be built is affected by planning and re-planning projects by Dubai authorities;
(vi)  the developer fails to commence the project due to gross negligence;
(vii) the developer declares its intention not to commence the project for reasons acceptable by the DLD;
(vii)  the developer declares bankruptcy;
(viii) any other causes as deemed by the DLD.

§         A developer can appeal the DLD’s decision to cancel a project within seven days of being notified by the DLD.

§         If the balance in the trust account is insufficient to satisfy the purchasers’ rights, the developer shall repay the outstanding sums to the purchaser within 60 days of cancellation unless an extension is granted by the DLD.

§         If a developer fails to repay the sums to purchasers in cases of project cancellation, then the DLD has the authority to take necessary steps to protect purchasers’ rights including referring the matter to competent judicial authorities.

Additional notes from Hadef & Partners:

“The Regulations whilst providing some much needed clarity over many issues also throws up some interesting characteristics such as reinforcing the wide degree of power and discretion the DLD holds in respect of projects.

It is also still not clear how the DLD will approach situations where a purported termination of a purchaser is met with resistance and/or whether the DLD will remove an interest in the interim register without a court order where a legitimate dispute has arisen. Further clarity may also be needed where a bankruptcy event occurs as to how exactly the interim registered interests will be treated as far as priority is concerned in the bankruptcy situation.”

Posted in Dubai, Dubai Legal - Real Estate Lawsuits, Rera Dubai | Tagged: , , , | Comments Off on Dubai Property Law 13 on the way

Dubai-More than fith of construction projects have been put on hold or canceled

Posted by 7starsdubai on February 6, 2010


original source The National

DUBAI // As an amateur photographer and property investor, Imre Solt found himself visiting construction sites throughout Dubai to document the progress of the rising skyline of Dubai on a daily basis. Now he is lucky to find a significant change at a project once a month.

“Sometimes I don’t take any photos at all because there is no progress,” says the Hungarian-born Mr Solt, who has captured the city’s growth in what he estimates are 100,000 pictures taken from the tops of tall buildings, helicopters and even a biplane. “There are a few buildings that have made very good progress, but I think more projects are on hold than before. Sometimes, there are just a few workers there.”

The numbers bear him out. More than a fifth of construction projects in Dubai have been put on hold or cancelled in the past year, with the remainder severely delayed, said Proleads, a construction information provider. Proleads also estimates that the number of construction workers in Dubai has declined 45 per cent from the peak of the property boom in 2008 to last month, a further sign of the city’s post-boom state.The problems are not isolated to Dubai, with projects in Abu Dhabi, Ras al Khaimah and Ajman similarly stalled.

“You have this stalemate,” says Andrew Charlesworth, the head of capital markets at the property consultancy Jones Lang LaSalle. “We are not seeing any distressed sales come through. Banks are reluctant to foreclose. Buyers can’t make payments and developers can’t build.”

continue reading…..

Posted in Dubai, Dubai Legal - Real Estate Lawsuits, Rera Dubai | Tagged: , , , , | Comments Off on Dubai-More than fith of construction projects have been put on hold or canceled

New Law – Protection for Dubai Property Investors

Posted by 7starsdubai on January 24, 2010


New Dubai Land Law – Property refunds
original source The National / by Bradley Hope

Property investors in Dubai will be eligible for refunds or replacement property if they fall victim to unscrupulous or failing developers, under laws planned for this year.

And developers will face new financial penalties if the buildings they promise are not delivered on time, or to agreed specifications.

Details of the proposed laws were revealed in a newsletter from the law firm Al Tamimi and Company, which ran a dialogue between Lisa Dale, the head of the firm’s property practice, and Emad Eldin Farouq, a senior legal adviser at the Dubai Land Department.

“There are lessons to be learnt from the crisis and we are emerging with a new legal regime,” said Mr Farouq. “Loopholes in laws are being dealt with and things will become more organised in 2010.”

As more buyers default on their payment plans and developers fail to deliver buildings on time, legal disputes are expected to remain a dominant theme in the UAE this year, lawyers say.

“2010 is still the year of fighting,” said Michael Lunjevich, the head of the property practice at Hadef and Partners. “It will be about consolidations, legal claims, liquidations and insolvencies. The market needs to clean itself out.”

The most significant elements of the proposed legislation in Dubai relate to the protection of property investors, including the refund or replacement property for buyers where the developer delivers a defective property, and financial penalties for late delivery.

The laws would also establish the grounds on which a purchaser can demand cancellation of the contract if, for instance, the developer refuses to link payment plans with construction milestones.

“The investor protection law is being proposed to deal with some specific issues identified last year, where investors needed further assistance in dealing with errant developers,” Ms Dale said.

Another element of the legislation would allow Emiratis with land granted to them by the Government to convert it to a freehold title, allowing them to sell it to another Emirati or GCC national, or mortgage the property, she said.

“The granted land system is a tradition in the UAE, enabling nationals to have access to lands for the purpose of building their home or business premises,” Ms Dale said.

“However, the system is quite limiting, as there are restrictions on transacting with such land. If you upgrade your title from granted to freehold, you can sell the property to other UAE or GCC nationals, or you can put it into a property fund or mortgage it. It becomes a much more flexible asset.”

The Dubai Land Department also plans to begin regulating property valuers and conveyancers by requiring them to obtain licences, and to create a law to oversee property brokers who handle trust accounts for property deals, Ms Dale said.

The department has created a draft law that would provide a regulated structure for establishing and managing property funds, which would “potentially provide a boost to the Dubai real estate market by generating an increased level of collective investment activity”, she said.

Mr Farouq said in an interview yesterday that the Dubai Land Department was seeking to raise its number of lawyers to 15 from 10, and bring on board more property experts to help deal with the overflow of cases that have arisen from the slowdown in the property sector.

Planned laws welcomed, b4

But the wider problem for clearing the system of legal disputes is the relatively uncertain nature of property legislation in Dubai.

Last year, the authorities announced Law No. 9 as a definitive system for determining what happens in the event of a buyer default, but the regulations spelling out the specifics of the law have yet to come out.

Alexis Waller, the head of the property practice at Clyde and Company, said developers and investors in Dubai faced a “change-of-law risk”.

“You could do something today that could be impacted by a new law later,” Ms Waller said. “We are operating in a jurisdiction where there are a lot of grey areas.”

Posted in Dubai, Dubai law, Dubai Legal - Real Estate Lawsuits, Dubai Property legal | Tagged: , , , | Comments Off on New Law – Protection for Dubai Property Investors

Dubai developers Cirrus and Kaizen disappear – Investors worried

Posted by 7starsdubai on November 14, 2009


original source Construction Week Online Dubai, 14 November 2009

Confusion has broken out over the whereabouts of international real estate firms Cirrus Developments and Kaizen Developments.

Both developers are responsible for hundreds of millions of dollars worth of developments in Dubai and across the region, including Cirrus’ Aquarius Gate in the Waterfront area, and Kaizen’s Equinox Residences at Palm Jebel Ali.

Websites for the companies are no longer active, while phone numbers listed on their brochures have not connected.

Cirrus Developments had been developing Celestial Heights – a mixed-use project of three towers, in the Downtown Jebel Ali master development, but the project is now being looked after by a firm called Catalyst Project Consultants, Construction Week has learned.

“Cirrus was part of phase one of Celestial Heights, then the owners appointed Catalyst,” Catalyst Project Consultants’ director Israr Ahmed told CW.

“Cirrus have downsized and moved offices, but they handed over all work related to the project over a two month period.”

Ahmed also said that Catalyst was “not at all” related to Cirrus Developments but it did have links to Kaizen Developments whose logo featured on early Celestial Heights marketing materials.

The last number he had for Cirrus could not be connected.

Dubai’s Real Estate Regulatory Agency (Rera) confirmed to CW that a developer by the name of Kaizen One Investment Limited was an approved developer, but the phone number it had registered for Kaizen now belongs to a general trading company.

Significantly, the registered website that Rera had for Kaizen One Investment Limited was http://www.cirrusdevelopments.com, which is now defunct.

Construction Week eventually managed to reach Cirrus Developments’ brokerage number where a receptionist said: “Due to the [financial] crisis, we have suspended the brokerage”, but insisted that despite not appearing on Rera’s list of approved developers, the development side of the company was still in operation.

Both public relations firms which represented Kaizen and Cirrus in the past confirmed that they were no longer their clients.

Kaizen Developments is unreachable.

Do you work for Kaizen or Cirrus? Have you invested in their projects or have you worked on their projects? Please contact constructionweek online

Posted in Dubai | Tagged: , , , , , | Comments Off on Dubai developers Cirrus and Kaizen disappear – Investors worried

Dubai Good News – Dubai property dispute victims to get free legal advice – Let`s Hope that this is not again only a promise

Posted by 7starsdubai on November 3, 2009


source Arabian Business

Dubai Land Department on Monday announced a new initiative to introduce a free legal service to support home owners involved in real estate-related court cases.

The announcement follows a meeting between senior Land Department officials and representatives of law firms to finalise details of the move.

The Land Department said an agreement had been signed which would see the law firms become part of a new Legal Care Group.

The group will bring together senior lawyers, professional firms and consultants to offer free legal assistance to members of the public with “genuine real estate issues” who might otherwise be dissuaded from taking action because of the prohibitive cost of fees, the Land Department said in a statement.

Mohammed Sultan Thani, assistant director general of the Dubai Land Department, said: “The objective of this initiative is not merely to meet a need but to ensure fairness and justice is available to anyone who might have a concern which involves property, no matter their circumstances.

“This reflects the government’s commitment to ensuring there is in place a comprehensive equitable system of legalizing ownership and property transactions.”

He added: “Now, no one is prevented from pursuing their rights merely because of the possibility they might be priced out of the legal system.”

Richard Green, head of research at CB Richard Ellis Middle East, said: “The offer of free legal advice is another step in the right direction. Overall confidence in the legal dispute system has been somewhat low due to a time lag in addressing the current case backlog.

“This announcement will go some way to renewing faith in the system as well as providing confidence to individual investors facing financial difficulties in their disputes against developers.

“Overall this is seen as another positive advancement for the Dubai market.”

In August it was reported that property dispute cases that were originally submitted to the Real Estate Regulatory Agency (Rera) and Dubai Courts are now being dealt with by Dubai’s new Property Court.

The new court, which started operations in October, was set up under the First Instance Court to deal exclusively with property-related cases.

Posted in Dubai | Tagged: , , , , | Comments Off on Dubai Good News – Dubai property dispute victims to get free legal advice – Let`s Hope that this is not again only a promise

Dubai`s off-plan buyers cash at high risk – Delayed Projects axed

Posted by 7starsdubai on October 29, 2009


source  MaktoobBusiness

DUBAI – Many real estate projects claimed to be on hold due to the collapse of the UAE’s property market have actually been cancelled, but developers do not want to admit this because then they will have to return investors’ money, industry observers say.

Observers also question some developers’ ability to repay investors when projects are finally cancelled, with the prospect of buyers losing millions of dollars.

“In the 18 months before the downturn a number of projects were announced that were not financially viable and therefore unlikely to see completion,” said Tahir Akhtar, chairman of Dubai Business Advisors, who has invested in projects across the UAE.

“Developers do not want to admit this because then they will have to return the funds.”

Billions of dollars worth of developments were launched during the UAE’s real estate boom, which had seen property prices close to double by mid-2008 from the start of 2007.

The boom was driven by speculation and easy credit, with developers funding the construction of projects through off-plan sales.

When the global financial crisis gripped the country’s real estate market prices plummeted as financing and demand dried up, leaving developers unable to fund construction.

UNDER REVIEW

Many developers have put projects on hold or have said they are reviewing projects, but few have come out and outright cancelled projects.

“If they (developers) say it’s cancelled they will have to repay the money to clients. Probably for that reason they are saying it is still on hold,” said Charles Neil, CEO of property consulting firm Landmark Advisory.

Michael Shvo, a well-known luxury real estate marketer from New York, said a developer told him privately a project that is “officially” delayed is actually cancelled, declining to name the developer.
 
“A developer told me that officially the project is on hold, but it is actually cancelled,” Shvo told a conference at Cityscape Dubai earlier this month, prompting him to call for greater transparency.

The number of real estate projects cancelled or on hold stood at around $408 billion in September, up 18 percent from $346 billion in April, according to the Kuwait Financial Centre.

The Centre, also known as Markaz, said it expects cancellations to rise further in Dubai due to the continued lack of financing and uncertain economic outlook.

UAE real estate regulations vary from emirate to emirate, but currently there are no laws governing how long a project can be on hold before a developer must refund investors’ money.

In Dubai, the UAE’s most developed real estate market, authorities are in the process assessing which projects are unviable and should be cancelled, with the findings due out before the end of the year, according to the Real Estate Regulatory Agency (RERA)

Developers are not allowed to cancel projects in Dubai without the approval of RERA and the Dubai Land Department, RERA said, adding that if a developer does get approval to cancel a project it would have to reimburse investors. 

“It will vary from project to project as which ones will go ahead. Some will end up with half-completed buildings and some may not start (at all),” Landmark’s Neil said.

INVESTOR CONCERN

Investors have become increasingly vocal in voicing their concerns about delayed projects, calling on developers to transfer their investment to another project or refund their money.

Larger companies such as Emaar Properties and Nakheel have set up schemes that allow buyers to swap their investments between projects, but smaller developers lack the project portfolio to offer an alternative, analysts say, leaving investors at risk of losing their money.

Dubai Business Advisors’ Akhtar said a group of investors he belonged to stood to lose around 150 million dirhams ($40.8 million) from projects in the UAE emirate of Ajman that now look like they may not go ahead.

“Not a lot has been done to protect investors,” he said.

Dubai brought an escrow account law into force in mid-2007 in an effort to better protect investors – requiring developers to hold buyers’ money in a special bank account until the completion of a project – but many projects had been launched prior to the law, and other emirates were even later in introducing similar regulations.

“Most projects that fall under the escrow provisions of RERA have an established level of comfort and protection. Those projects that are not covered by escrow are a different situation,” said Blair Hagkull, regional managing director of Jones Lang LaSalle.

Posted in Dubai | Tagged: , , | Comments Off on Dubai`s off-plan buyers cash at high risk – Delayed Projects axed

Dubai property owners treated like puppets – Loss off confidence swamps Real Estate Market

Posted by 7starsdubai on August 16, 2009


August 15. 2009 11:34AM GMT

DUBAI // Rashmey Seth paid Dh3.2 million for two luxury flats, furnished them and rented them out. That was nearly two years ago – but she is still not sure she actually owns the properties.

Receipts from Nakheel confirm that she paid the state-backed developer in full for a three-bedroom flat on the Palm Jumeirah. Mrs Seth has similar paperwork for a one-bedroom unit in downtown Burj Dubai, purchased last year from Emaar, the Middle East’s largest developer.

What she has not received from either of the property giants are title deeds – the crucial documents that verify ownership.

It is a predicament shared by many, their status as lawful owners in limbo because of the absence of a piece of paper that, after properties are registered with the Dubai Land Department, should be handed to buyers.

The issue, says Mrs Seth, makes her wonder whether she has a legal right to sell her flats.

She is by no means the only property owner in Dubai worried about not having deeds to the flats she has paid for. Without deeds, it is unclear what would happen if the company they bought their property from went bankrupt.

There could also be problems with selling the property on: potential buyers could find it difficult to get a mortgage without formal proof of ownership.

In Mrs Seth’s case, her dilemma has shaken her confidence in Dubai’s freehold property laws, introduced three years ago to give foreigners the right of ownership.
“Why am I not getting the comfort that there’s a legal structure to support me, that makes me feel sure that I really own my property?” said Mrs Seth, 52, an Indian who has lived and worked in Dubai for 28 years.

Her fears are not unfounded. Law Number 7 of 2006 states that until flats are registered with the Land Department, which will then grant title deeds, buyers lack the rights of fully fledged owners.

In an email statement, Emaar did not specify how many of its property holders had not had units registered or lacked deeds.

Nakheel said the “majority of … purchasers who have taken handover have received their title deeds”.

Given the size of Nakheel’s development portfolio, that could still mean thousands have not received them.

There are indications that a substantial number of buyers across Dubai lack deeds. After posting a query on Crest of Dubai, a website used by residents of the Palm Jumeirah, The National received nearly two dozen complaints.

And Michael Aldendorff, a 39-year-old South African who is one of the leaders of an informal homeowners’ group in the Discovery Gardens development, reckoned that most buyers in the 26,000-apartment community lacked deeds.

“I don’t think that many people here have them at all,” he said.

That, however, has not stopped developers from asking purchasers to pay to get their deeds.
Mrs Seth said she was asked to hand over about Dh55,000 for flat-registration fees to Emaar and Nakheel. She said she had little choice but to comply; according to Land Department regulations, a buyer cannot register a property without the developer’s consent.

“They take these undated cheques from you, and they bank it at their will, so what can you do about it?” she said of Emaar and Nakheel.

“If there is a delay or something from the Land Department in getting the registration, or the documentation is not ready from the developer’s side, then why are they taking my money?”

Sabri Pozem, who owns a one-bedroom flat in Discovery Gardens, in which he has a tenant, wonders whether the authorities – or anyone apart from himself – have records of his purchase.

Mr Pozem, a 29-year-old from Turkey, is one of the owners in the development who complain about disorganisation among Tamweel, the mortgage lender, Nakheel, the master developer, and property companies which, after purchasing Discovery Gardens apartment buildings from Nakheel, have sold them as flats to individual buyers.

He said a salesperson with the company he bought his flat from entered the property last month and began showing it off to a prospective buyer. His tenant had just come out the shower and was wearing only a towel when she encountered the surprise visitors.

“The problem is, they are so disorganised they don’t even know who bought which apartment in the building,” said Mr Pozem, who said he had tried many times to obtain his deed and has had no success.

He fears that if he wanted to sell his flat, the records would show it was still owned by the property firm. “If they go bankrupt tomorrow, I’m basically out of luck; all my money’s gone because I don’t have a title deed.”

Mr Pozem is not the only owner worried that without deeds they might not be able to sell their units.

Anne, 37, a British national, bought two one-bedroom flats in the Dubai Marina’s Marina Promenade in August last year and two more in Green Lakes Towers in Jumeirah Lake Towers. Despite investing nearly Dh4m, she does not have a deed for any of them.

Anne, who asked that only her middle name be published, said her main concern was that banks would refuse a mortgage to prospective purchasers without a deed, an increasingly common requirement after the credit crunch.

She also said Emaar, the developer of Marina Promenade, and Asam Investment & Real Estate, the Green Lakes Towers developer, had been little help.

“I’ve been given exactly the same reasoning: ‘there’s a queue at the Land Department; expect to hear from us in September’.”

A senior administrator at Asam Investment & Real Estate, who gave his name only as Abraham, told The National that a backlog at the Land Department was responsible for the delay.

In Green Lakes Towers, he said, about 700 units in the three towers were still waiting to be registered.

“We cannot do them individually; we have to register the whole tower together,” he said. He added that he hoped the process could be completed within a month.
Humaid al Shamsi, the head of the transactions section at the Land Department, acknowledged the issue.

Eighty per cent of the buildings on the Palm Jumeirah have been registered, he said, but he did not have details of how many flats had been registered or title deeds granted.

At Jumeirah Lake Towers, he said, “the process has been started now.” He attributed any delay to “extra measurements” being done to the buildings.

Emaar declined to give reasons for delays in handing over deeds, but said in an email that it “works closely with the Dubai Land Department to assist its customers during the process, including having a representative from the Land Department available for assistance at the Emaar Property Handover office.”

However, Karim Nassif, a property lawyer at Habib al Mulla & Co, said the slowdown in the property market meant a logjam at the Land Department was an unlikely cause for the problem.

In most cases of undelivered title deeds, he said, “the developer should be held liable – 100 per cent – for it. They should be delivering their title deeds”.

And he had a warning for the worried owners: “If they don’t have the title deed, their transaction, according to the law, is voidable.”

original source The National

Powered by ScribeFire.

Posted in Dubai | Tagged: , , , , , , , | Comments Off on Dubai property owners treated like puppets – Loss off confidence swamps Real Estate Market

Dubai Property Court – It´s Court Time

Posted by 7starsdubai on July 30, 2009


source Emirates Business

Abdul Qader Moosa, Chief Justice, Property Court, has said rights of real estate investors in Dubai are reserved under the laws enforced in the emirate.

He said Dubai has a specialised property court and advanced laws that go along with real estate developments and protect the rights of all parties of projects – investors, developers and contractors. Moosa told Emirates Business that Property Court judgments are more accurate and faster than those in many other Arab countries. This year the time a case takes at the Property Court of First Instance has gone down to 45 days from 57 in 2008.

Meanwhile, the time a case takes in the full [appeals] court has risen to 90 days in 2009 from 80 days last year because of the increase in the number of cases this year. It is a very short time in comparison with the years cases take in any other Arab country, he said.

A year has elapsed since the establishment of the Property Court. What are the court’s missions and achievements?

The court was established on June 15, 2008, by order of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai. It was part of the establishment of several specialised courts with an economic nature. Sheikh Mohammed believed the economic activity and progress of Dubai required the establishment of such courts, which aimed at fast and cordial settlement of financial and economic disputes.

Three specialised courts were set up: commercial, civil and real estate. Now Dubai has six specialised courts of first instance, which also include the civil status, labour and criminal, in addition to the previously mentioned courts. The emirate’s court system had to be updated to go along with the development taking place at the economic level in terms of the volume of projects as well as the growing number of workers and employees.

Real estate cases are those related to disputes emerging from acts or transactions related to property or brokerage, except for rent cases that are exclusively handled by Dubai Municipality’s Rent Committee.

The partial [first instance] real estate cases cover disputes whose values do not exceed Dh100,000. Such cases are heard by a court presided over by one judge. Meanwhile, full [appeals] cases are concerned for disputes with a value of more than Dh100,000. They are heard by an appeals court with three judges. And, like other judicial disputes, each real estate dispute case is allowed three litigation degrees (first instance, appeals and cassation). Only cases with a value of no less than Dh200,000 can be heard by the Court of Cassation.

What are the most recurrent real estate cases heard by the Property Court?

The court hears various types of cases, such as those related to demands of contract termination, contract validation, writing and handover of contracts, in addition to brokerage cases.

For instance, in contract termination cases, one party asks for the termination of a contract on the basis that the second party has failed to abide by the contract’s conditions. A buyer might ask for contract termination for failure by the developer to abide by conditions such as the completion of the project as scheduled. And, if proved, the court has to order the termination of the contract and the return of instalments paid, plus the proper compensation.

What about the size of cases heard by the Property Court, the litigation time and the percentage of completion?

The Property Court of First Instance received some 12 cases in the last six months of 2008. Judgments were given in five cases. Hearings usually took three months. In the first six months of 2009 the court has received 50 cases, and 43 were decided. Hearings are still on in the remaining seven cases.

The appeals Property Court heard 137 cases during the last six months of 2008. Twenty were decided while the rest were deferred to the 2009 judicial season. Each case took three months. Meanwhile, in the first six months of this year, the court registered 883 new cases, giving a verdict in 168 over a period of three months.

What are the judicial departments affiliated to the Property Court?

The court has five judicial departments, including three full [appeals] departments, one partial [first instance] and one for the enforcement of judgments. The latter is presided over by a judge who enforces the judgments issued by notifying the parties concerned to act within 15 days or face legal measures such as seizing of bank accounts, property, cars or even stocks.

In the light of the relatively short age of the court, how useful is the Property Court for the real estate sector of Dubai?

The presence of specialised courts in any country helps boost the confidence of those dealing with the subject they speacialise in. And the reality is that the real estate sector has acquired a large percentage of the emirate’s economic activity. The presence of a specialised real estate court working according to the principles of “justice for all” and adopting accuracy and speed in the settlement of disputes contribute to making Dubai an important attraction for investors in the region’s real estate.

How has the real estate crisis reflected on the cases heard and the types of disputes?

For a start, one has to stress that the volume of cases heard does not reflect the developments under way in the real estate sector, since the court is relatively new. This is also because of the presence of other specialised bodies and institutions, such as the Land Department, the Real Estate Regulatory Agency, the Contractors Association and others. And with the start of the real estate crisis, we noticed a state of fear as investors were concerned about the money they injected in property. The launch of the court coincided with the start of the financial crisis late last year, and we used to receive many queries from investors. We were surprised with the many cases of contract termination with developers by investors who fear that projects may not start. In fact we used to reassure buyers that there was an escrow account in which went all the money paid by the buyer. We reassured them that there was no fear their rights would be lost. That period witnessed many contract termination cases for failing to pay instalments. However, the number of such cases was very small compared to the volume of the emirate’s real estate projects.

What are the challenges facing Dubai’s real estate sector now?

In the light of the volume of projects completed, as well as those under way, I believe the biggest challenge is the simultaneous development and updating of laws that regulate the sector to go along with the developments. And in the absence of co-ordination and co-operation between us and the Land Department and Rera, both strategic partners, we work to update our legislations and laws to suit the sector’s needs. Also, as a property court, we have made a strategy that aims to expedite and facilitate litigation, reactivate partnerships with the bodies concerned, and to pass accurate judgments, modernise and develop real estate legislations in the light of the cases we hear.

What about the currently enforced laws and legislations?

At present we work under a number of laws, legislations and bills, including Bill No85 of 2006 on the real estate broker register, which allows officially recognised brokers to practice. There is also Law No13 of 2008 on the primary real estate register, which regulates the registration of property between the parties, and it is mostly off-plan sales. This is in addition to Law No7 of 2006, which is related to the permanent real estate register and includes the registration of property after it is completed. There is the Property Registration Law No3 of 2006, which defines areas where non-UAE nationals can own property, and Law No8 of 2007, which obliges developers to open an escrow account for each project and where investors’ money is deposited. Each project has a separate account, and it is not allowed to seize another project’s account to collect debts due on the developer.

What advice would you give to real estate investors?

Before buying property, an investor has to make sure that the developer, broker and the project where he intends to buy, are registered. Many investors buy from non-registered brokers or developers, or buy property that is not registered with the Land Department. Also, they have to deposit their money in the escrow account of the project, which guarantees their rights in case of any dispute. They need to be aware of the laws that regulate the real estate sector and which are available on the website of the Property Court and the Rera.

PROFILE: Abdul Qader Moosa Chief Justice, Property Court

Abdul Qader Moosa holds a bachelor’s degree in law and the police sciences diploma from Dubai Police Academy. He graduated from the Police Academy in 1994 and served as Chairman of the Lawyers’ Committee. He obtained a diploma from Dubai Judicial Institute in 1998. He was appointed deputy public prosecutor in 1995 and public prosecutor in 1998. In 1999, he became a judge in the Court of First Instance. In 2005, he was promoted to a judge of the Appeals Court and was appointed the chief judge of the Court of First Instance in May the same year.

In September 2006, he became the chief judge of the Labour Court. Moosa has won several awards, including the Distinguished Judge Award under the Dubai Courts Excellence Awards.

Posted in Dubai | Tagged: , , , | Comments Off on Dubai Property Court – It´s Court Time

Dubai `s glitzy property market is in trouble – no doubt about that

Posted by 7starsdubai on July 29, 2009


Western investors fear Dubai`s Wild East reputation.

Dubai’s property market is in trouble, there’s no doubt about that. Just take a look at the hundreds of motionless cranes, unfinished projects and the expats who are leaving in droves as they lose their jobs.

And prices and rents which soared during a six-year boom have crashed since late last year. According to one resident who recently moved in the City, it now costs 150,000 dirhams to rent a three-bedroom flat on the Palm, a man-made island off the coast of the emirate, around the same it would have cost to rent a one-bedroom appartment there a year ago.

It’s not just the global downturn thats the concern for Dubai’s once-booming property market, but also the lack of transparency and need for greater regulation. And that’s what’s going to keep the western investor from splashing the cash.

Investors looking at Dubai’s real estate sector are a different breed. They are no longer looking to snap up properties in the hope of making a quick buck. They are more conservative with a longer term outlook.

“RERA (the Real Estate Regulatory Authority) has been trying to introduce regulation to minimise the impact of speculative investors,” said Andrew White, head of Middle East operations at UK-based investor Kenmore property Group.

“But some have said this is like shutting the stable door after the horse has bolted because the downturn has more or less wiped these out anyway.” So, a little too late perhaps ? And what about the recently announced planned merger of Emaar Properties, builder of the world’s tallest tower, with
three other local property firms?

Well, so far no one really knows. Simply put, there has been little in the way of information about this.

“If you look at Emaar and the potential merger, there is little financial clarity on how this will proceed and that is going to worry investors,” said Bobby Sarkar, analyst at Al Mal Capital. ”The U.S. and European markets have high levels of clarity in terms of regulation, but that isn’t the case here.”
 
There is no doubt however that the government is trying to improve regulation and transparency. Several wins for the property market over the last year include the introduction of a monthly rental index and new laws for property maintenance, not to forget the continuing effort to crack down on corruption.

But there is a long way to go and more is needed for Dubai to come close to rivalling mature markets such as the UK and U.S. which offer the longer-term investor the transparency they crave.

original source Reuters

Posted in Dubai | Tagged: , , , , | Comments Off on Dubai `s glitzy property market is in trouble – no doubt about that

Damac Dubai – UK TV news investigation

Posted by 7starsdubai on July 29, 2009


Dubai – 29. July 2009

In a report broadcast Monday night in the UK, Channel 4 News spoke to unhappy British investors with property developer Damac who have yet to see a return on their money in the Dubai market.

While some wanted quick returns, others simply wanted an apartment in the sun – not least David Hunter of Oxfordshire who said he had handed over £60,000, so far, for an apartment at Damac’s Lotus development.

Hunter said a Damac representative told him at the time (February 2007) of purchase that construction on the development had already started.

Three months later Hunter found out otherwise when it emerged that the plot was occupied by a UNICEF building. Hunter not surprisingly said he ‘should have been told’.

Citing documents, Channel 4 claimed Damac had been selling developments off-plan without having title to the land in the first place – a practice outlawed by the Dubai Government last August.

Another document, dated from ‘late last year’ alleged that almost one quarter of the firm’s projects had been put on hold.

Meanwhile, a Harrow NW London resident who bought off-plan in the Flamingo Heights development 18 months ago, told the broadcaster he had paid three instalments totalling £70,000.

”I asked them in writing what the current state (of the development) was before I made my investment. I was assured that the foundations had been laid and construction was well under way at the site.”

With the Flamingo Heights development showing no evidence of construction when Channel 4 recently visited it Ludmila Yamalova of Al Sayyah Legal Consultants – to whom Channel 4 took the investor’s complaint – said he may have a case as a statement claiming foundations that had been laid when in fact they hadn’t, could amount to misrepresentation.

Erik Pekarski, former VP Customer Relations at Damac said the line being put out to customers was that ‘progress is ongoing, development is ongoing and construction is ongoing’.

Customers would continue to scream and yell at you as they should, because they had been put off for months, he added.

Damac has, in some cases, since offered alternative flats either complete, or near completion. However, many investors Channel 4 spoke to said they wanted their money back but, like the Harrow investor, had been informed by Damac that there is a ‘no refund’ policy.

When asked about the ‘no refund’ policy an unnamed former manager at Damac said the company took a tough line. David Hunter meanwhile says he has hired a lawyer.

In a statement to Channel 4 News the company confirmed it didn’t have a refund policy, except within ‘the provisions of the regulatory framework’.

It also denied any allegations of wrongdoing and said investors interviewed by the broadcaster were ‘not a representative group’. The company added that it had no intention or policy to mislead customers.

Addressing the allegation that the company had claimed foundations had been laid at the Flamingo Heights development when in fact they hadn’t Damac said: ”It is possible to have a rogue element who communicated information which was inaccurate and not endorsed.”

It added that the Flamingo Heights project tender is due to go out shortly.

source of this report Arabian Business

Posted in Dubai | Tagged: , , , | Comments Off on Damac Dubai – UK TV news investigation

Dubai Property Market – Flippers, skippers, runners, survivors battle it out

Posted by 7starsdubai on July 19, 2009


source PropertyWeekly

‘Flipping’, ‘skipping’ and ‘running’ are relatively new terms in the argot of Dubai’s property market. Many would know about at least one person who has done one of the three ‘disrespectful’ things, and may even be aware of several more via the city’s thriving rumour mill.

The residents who remain also have a new nomenclature for themselves — the ‘survivors’.

New players experiment with speculation

Flipping was hitherto the activity of buying and selling property instantly, and solely for instant profit. Despite the impression that this dangerous game is a thing of yore and was once the exclusive prerogative of high risk takers, it is not, and has attracted new players.

Flipping was once restricted to incomplete properties, but they are now doing it with credit notes. Also, flippers are not necessarily risk takers; some are trying to recover investments gone awry, while others are desperate for much needed cash.

Offloading multiple units

AR is a classic flipper. In December 2007, he owned three apartments — on paper — at various buildings in Dubai Marina. By September 2008, he had sold two for a cumulative profit of Dh1.23 million, despite the fact that both were not ready for occupation.

“I am lucky that I disposed them of before it was time to start paying my mortgages and before the economic downturn,” he says. “If things get bad, I will move into the one I still own, so no money lost. But, many other people who acted impulsively have done badly. I know some really sad stories and consider myself blessed.”

However, despite his narrow escape from steep losses, AR cannot shed his innate instincts. When questioned, he admits that he has purchased a credit note for 60 per cent of its face value, and is looking for a buyer who will take it off him for a profit.

Skippers caved in

Skippers are other risk takers like AR, but who didn’t have the sense, instincts, or gumption to offload their properties when the market soured. When they could not find buyers and saw alarming drops in prices, they caved.

Faced with the prospect of bounced cheques, rising debts and the threat of unemployment, some of these foolhardy investors just upped and left, or skipped.

Skippers are not available for quotes, but TQ who left the country in the first week of February is believed to have invested in no less than six properties across the country. A feat made possible by two facts: he was the creative director of an advertising agency and had a substantial salary, and he dealt with an Islamic bank that allows customers to have multiple mortgages.

Coincidentally, the day he lost his job is also the day he realised that the next set of payments towards his property portfolio totalled Dh246,000, and also, that there were no prospects of serious buyers on the anvil, for any of them.

Forfeiting down payments

His simple solution was to forfeit the nominal down payments he had made on the said properties, and to head back to his native country to sit out the storm. In his case, he paid off his credit cards, cleared his lesser debts, and told his bank that he was giving up his claim on the many apartments he owned.

Trail of debts

Runners, on the other hand, don’t bother doing any of the latter or the formalities associated with relocating from the country. One minute they are in Dubai, revelling in their enviable status as the owners of several properties, and the next minute, they are simply missing from the country, with only the trail of debts proving they lived here. They could now be anywhere.

Finally, those who have heard the horror stories and heaved heavy sighs say they too need a moniker for not falling into any of the above categories.

Ordinary residents who continue to pay rent on their homes, have strongly resisted the urge to invest in property. Those who actually live in the properties they purchased say they are just holding tight.

BJ owns a modest studio flat at The Greens and his brother MJ rents a one-bedroom apartment at Dubai Marina, and by their own admission, they worry about the appalling state of the world, just as much as they are alarmed about their own job security… or the possible lack of it.

According to MJ, their mission is to put away and save as much money as they can every month just so that they are not taken unawares by any unpleasant surprises — be it falling prices, increased rents, unexpected payments or unplanned debts.

“All those people we hear about have titles that classify them into categories. We believe that the rest of us who live in Dubai and eke out an everyday existence without running, skipping or flipping need one too. Just call us the ‘survivors’,” say the brothers.

And they are not being sardonic.

Flippers now deal in credit notes

• Despite the impression that flipping is a thing of yore and was once the exclusive prerogative of high risk takers, it has attracted new players
• Flipping was once restricted to incomplete properties, but they are now doing it with credit notes
• Also, flippers are not necessarily risk takers; some are trying to recover investments gone awry, while others are desperate for much needed cash
• Skippers are other risk takers, but who didn’t have the sense, instincts, or gumption to offload their properties when the market soured
• Runners simply go missing from the country, leaving behind a huge trail of debts

Posted in Dubai | Tagged: , , , , , , | Comments Off on Dubai Property Market – Flippers, skippers, runners, survivors battle it out

RERA Dubai has designated 69 proptery projects

Posted by 7starsdubai on July 17, 2009


The Real Estate Regulatory Agency has been surveying every project in Dubai with an engineer who photographs the site and gives the official state of construction. Until recently, none of these projects were designated as stalled.

Now, Rera has designated 69 projects out of 407 surveyed (so far) as “on hold”, or about 17 per cent.

Two developers, in particular, are responsible for many of these: Abyaar Real Estate Development and Al Mazaya Holding, both from Kuwait.

Abyaar has put on hold 46 groups of villas in its Acacia Avenues project in Al Sofouh alone, as well as its Pier 18 project in Dubai Marina, its Olgana tower in Al Sofouh, and its Hiliana tower in Al Sofouh. That amounts to 49 projects, according to Rera’s survey

Al Mazaya has delayed 14 of its clusters of buildings in its Q Point development in Dubailand.

Other stalled projects include Damac Development’s Admiral Bay in Maritime City; Dheeraj & East Coast LLC’s Bay Residences in Business Bay; Marina Crown Real Estate’s The Vantage in the Dubai Waterfront; the RUFI Heaven in International City; and the RUFI Luxury Heights in the Dubai Waterfront.

Most of these projects are from smaller developers, so it’s most likely just the tip of the iceberg when it comes to delay.

Posted in Dubai | Tagged: , | Comments Off on RERA Dubai has designated 69 proptery projects

Real estate brokerages ignore Rera regulations on advertising

Posted by 7starsdubai on July 15, 2009


source Business24/7

Most of the real estate brokerage companies in Dubai are ignoring Real Estate Regulatory Agency’s (Rera) rules when it comes to newspaper advertising.

A search of newspaper listings shows that even some of the top brokerage companies don’t mention their Rera registration numbers, leave alone mentioning the trust account number for off-plan properties or title deed number for completed properties.

Rera regulations state that when a real estate brokerage company advertises “off-plan” properties, the advertisements must mention the project name, the trust account number and the broker office registration number. And for completed properties, they need to mention the title deed number and the broker office registration number in the advertisements.

“If brokerage companies fail to comply with the advertisement guidelines mentioned above, we send a notice to them through the Department of Economic Deve-lopment (DED) asking them to comply with our guidelines. If any company fails to comply with our guidelines, we issue penalty through the DED and take legal action,” a senior agency official said.

This newspaper has reported about Rera’s recommendation that people should only use service of Rera-registered brokers. They should also check the broker’s Rera accreditation at the agency’s website (www.rpdubai.com) before dealing with them.

Posted in Dubai | Tagged: | Comments Off on Real estate brokerages ignore Rera regulations on advertising

RERA Dubai freezes developer escrow accounts

Posted by 7starsdubai on May 27, 2009


source TheNational

May 28. 2009

The Dubai Real Estate Regulatory Authority (RERA) has frozen the escrow accounts of some property developers as it awaits assurances that construction is progressing and that all homes sold have been registered with the Dubai Land Department.

This is the latest measure by the authority to safeguard the interests of property investors as the market grapples with a shortage of lending and declining property prices.

Marwan bin Ghalita, the chief executive of RERA, said some developers needed to provide technical reports to the authority’s trust account department detailing the progress of construction before they can withdraw money from the accounts.

“There can be no withdrawal until they have completed the technical report,” he said.

“Payment needs to be linked to construction progress. They also need to prove to RERA that they have registered investors rights with the Land Department.”

Mr bin Ghalita would not say how many accounts had been frozen. RERA introduced the escrow account law in February last year.

Posted in Dubai | Tagged: , , | Comments Off on RERA Dubai freezes developer escrow accounts

Al Fajer Properties – Dynasty Zarooni – Investors Petition – 500 signatures

Posted by 7starsdubai on May 25, 2009


Al Fajer – Ebony & Ivory – Petition – Ordered to Pay 500 Million

Posted in Dubai, Jumeirah Business Centre | Tagged: , , , , , | Comments Off on Al Fajer Properties – Dynasty Zarooni – Investors Petition – 500 signatures

Questions and Answers with the Dubai Land Department

Posted by 7starsdubai on May 21, 2009


Source Zawya

There has been considerable debate in the real estate sector following the issuance of Law No 9 of 2009 amending Article 11 of Law No 13 of 2008 on the Interim Register in the Emirate of Dubai . This law concerns specifically the issue of termination of sale and purchase agreements (SPAs) for off-plan units and the damages payable.

Mohammed Kamal, Head of Real Estate-Middle East at Lovells’ Dubai office, recently met with Emad Farouq, Senior Legal Counsel at the Dubai Land Department (DLD)
and Real Estate Regulatory Authority (RERA).

Below is a summary of the question and answer session with Emad Farouq.

Law No 9 of 2009 is now in force. Can you please explain the main implications of this law and how it affects the termination of SPAs for the sale of off-plan units?
This law seeks to impose a new regime for the termination and payment of damages for SPAs for the sale of off-plan units which will apply retrospectively to all prior SPAs. It will amend the provisions of Article 11 of Law 13 which previously stated that upon termination the maximum damages payable to a developer would be 30% of monies paid to date.

The law will also override the administrative circular which was issued by the DLD
in 2008.

Under Law 9, the developer will be entitled to damages strictly according to the progress of construction for the project regardless of what has been agreed in the SPA. There are 5 categories of damages ranging from no damages (i.e. developer will refund all monies received), in cases where RERA cancels the developer’s project, to entitlement to retain all monies received and recover any shortfall if the developer has completed 80% or more of the construction. The intention behind the law is to create a balanced and fair mechanism for the termination of SPAs and assessment of damages. The vast majority of SPAs and arrangements in the market are either vague or unfair, or both. Therefore it was absolutely essential to intervene to provide certainty in the real estate sector going forward.

Can you explain the developer’s obligations under Law No.9?

Generally the developer is obliged to issue notices for termination of SPAs through the DLD
will assess the merits of the case and then decide on whether the developer is justified in terminating the SPA and will also assess the status of construction of the project in order to identify which category of damages will apply.
It is important to note that although a developer may be entitled to resell a unit, it must account to the purchaser for any surplus monies it receives once it has received any damages it is entitled to i.e. the developer cannot be unjustly enriched.

Under Law No 13 of 2008, there is a requirement for all sale and purchase agreements to be registered by 30 October 2008. Has this deadline been extended?

Yes, the deadline has been extended but will be confirmed through the Executive regulations which are being reviewed. Currently, the DLD will allow registration of SPAs after the deadline, provided there is a valid reason for the delay.

What is the Land Department’s view on the recent Property Court judgment concerning the master developer, Mizin?

In this case the Property Court (which is a division of the Dubai Courts) considered an agreement which was not registered on the interim register under Law 13 of 2008 as null and void and ordered Mizin to refund all monies paid by the purchaser. It is clear that the Property Court has taken a literal interpretation of Law 13 and in this case has made a decision which is in favour of the purchaser.

The DLD considers the decision to correspond with our understanding of the interpretation and application of Law 13. In particular, it confirms that if an agreement is not sufficiently registered under the law, then it will be considered null and void and is not enforceable as a binding agreement. Registration is conclusive evidence of rights relating to property, whether they are registered in the real register or the interim register.

Does Law No 9 cover terminations of SPAs for both sales of plots and off-plan units?

Law 9 is intended to cover sales of off-plan units only. SPAs for plots will not fall under the categories for damages under Law 9 and the parties will need to rely on the provisions related to termination and damages under the SPA and, if necessary, issue proceedings in the Property Court to settle any disputes.

Can you confirm what will be covered under the Executive Regulations following Law No 9?

The Executive Regulations under Law 9 are intended to provide guidance on the procedures and practical application of Law 9, amongst other issues. The Regulations will predominantly cover the procedure for termination of SPAs and payment of damages. They will also confirm the rights and obligations of a developer when reselling a unit upon termination and refunding any excess monies to the purchaser. The Regulations will also cover the grounds for cancellation of projects by RERA.
RERA may also request an independent third party expert report to assess the status of construction for a project.

What other laws and regulations can we expect to be issued in the coming months by
Dubai Land Department and RERA? e.g. Strata law regulations
The draft Strata regulations are being considered and will clarify the status of master community declarations, owners’ associations and the management and operation of common property.

We also expect further laws and regulations from DLD/RERA concerning Real Estate Investment Portfolios, Trust Law, Granted Land and Land Development laws and regulations on the restriction on developers collecting no more than 30% of the purchase price before commencement of construction and the requirement for developers to have paid for the land and obtained title and completed 20% construction before it can sell units off-plan.

The future…

Law 9 has been much anticipated by the real estate market and it now paves the way for a swift resolution to property disputes. The Executive Regulations must ensure that a fair balance is created between the rights of the developer and the purchaser and it will be crucial that the Property Court demonstrates consistency in the application of Law 9. Recent reports in the media have indicated that approximately 520 cases have been registered with the Property Court in 2009 and we expect many more to follow. It is expected that the Property Court will also be supplemented with a mediation centre in order to reduce the number of cases.

Lovells will remain at the forefront of new developments in the real estate sector and we aim to provide you with further updates on this topic as more information is available.

About Emad Farouq
Emad is the Senior Legal Counsel at the Dubai Land Department. Previously, he spent 15 years with the UAE Federal Chamber of Commerce and Industry. Emad has played a significant role in the last 5 years in the development of property legislation and regulations in Dubai. In December 2008, Emad was awarded “Best Government In-House Counsel” by the Dubai Corporate Counsel Group.

About Mohammed Kamal
Mohammed is the Head of Real Estate for the Middle East in Lovells’ Dubai office. He has been based in the UAE for several years and has been consistently involved with some of the largest real estate deals and projects in the region. Mohammed is recommended as one of the leading real estate lawyers in the region in Who’s Who Legal.

For further assistance please contact Mohammed Kamal, Head of Real Estate-Middle East.

© Lovells 2009

Posted in Dubai | Tagged: , , | Comments Off on Questions and Answers with the Dubai Land Department

RERA – Dubai mulls cancellation of 27 projects

Posted by 7starsdubai on May 12, 2009


source ArabianBusiness

Dubai is considering cancelling 27 projects, the head of its real estate regulator said on Monday, as the emirate’s property market slumps in the global downturn.

A decision whether to cancel or not would be made by the end of the month, said Marwan bin Ghalita, the head of the Real Estate Regulatory Authority (RERA).

“The decision has not been done. They are projects all over Dubai – third party projects (sub developers),” he said.

Earlier this year, Ghalita said he believed 25 percent of projects will be cancelled in Dubai as a result of the global economic slowdown.

“It’s almost the same,” he said when asked if that figure had changed. The Dubai Land Department and RERA set up a committee last week to cancel projects in the emirate that are not feasible.

Posted in Dubai | Tagged: , , , | 7 Comments »

Comment of the Day – RERA Dubai

Posted by 7starsdubai on May 10, 2009


by Joe May 10, 2008

You are not alone there. Probably there are thousands of investors in this moment who invest in off plan property and now balancing on the edge of precipice.

What is very sad that authority doesn’t do their job. They have established RERA and Laws around but RERA does not act in accordance with responsibility that they have. By their passiveness they actually support developers to make with investors what every developer would like. But this is like huge boomerang that will devastatingly  hit entire Dubai project.

I am simply stunned how authority is looking peacefully while full crowded ship sinking in front of their eyes.
By Law No 9 it is evident that RERA would like to help developer rather than helping investors. Where will be our investment place after Law No.9 just God knows.

What will be rules and conditions to cancel project will probably depends on color of skin, distance from Sheikhs, residency, are the owner  of Developer  domestic or stranger etc.

And do you think that investors are asked to participate in panel? Or when composing rules for categorize project to what “Sliding Scale” to place it?

I think that without pressing from outside they will still think that they can do whatever they would like and manipulate with foolish investors as much as they want.

UAE is not alone in the Earth. Their life depends on world community. Without respect to all of us who wanted to participate in Dubai story they do not have future.

One lesson was recently reached UAE by freezing permission for using nuclear power for civil purposes caused by incident from royal family.

I think that there has to be more lessons if outside investors are going to lose their invested money. We have to ask our government to protect our interest in Dubai.

Posted in Dubai | Tagged: , | Comments Off on Comment of the Day – RERA Dubai

RERA Dubai – Panel to identify unviable projects for cancellation

Posted by 7starsdubai on May 7, 2009


source Business24-7

Dubai Thursday, May 07, 2009

The Dubai Land Department and the Real Estate Regulatory Agency (Rera) have set up a committee that will decide on cancellation of “unviable” projects, senior department officials said yesterday.

Addressing an investors’ meeting, officials said a committee has been formed to study and analyse non-feasible projects.

“It is a tedious task and requires a lot of paper work. But the committee has been created to address the issue,” a senior official said.

Ludmila Yamalova, Partner, Mac Davidson Legal Consultants, who was present at the meeting, told Emirates Business that officials admitted project cancellations were not under their purview earlier, but amendments to Law No13 regulating the Interim Real Estate Register in Dubai now allows them to cancel projects that they deem not feasible.

In February, Rera Chief Executive Officer Marwan bin Ghalita said he believes 25 per cent of the projects will be cancelled, as developers did not start them or don’t have an intention to begin. However, he could not be reached for comment on the number of developers requesting cancellation.

The officials further told investors that the detailed regulations for Article 11 of Law No13, which lays down the terms for cancellations of “off plan” properties, will be announced soon and will explain terms such as “beyond developers control” in detail.

According to Yamalova, the authorities said developers will no longer be allowed to retain any money on reselling of units on termination of investors’ contract.

“Developers will no longer have any incentive to cancel contracts, as the money received on the resold unit will have to be deposited with the trust account of the Land Department,” she added.

Besides, Rera is also ensuring all amended payment schedules from developers need to be approved by them, with it planning to upload all payment plans on their website.

According to Rera statistics, 31,003 and 43,880 units will enter the market in 2009 and 2010, respectively.

However, it believes 20 per cent of residential units may not enter the market this year.

In February, it said the number of developers has come down from about 870 to 427.

Posted in Dubai | Tagged: , , | 3 Comments »

Confusion over RERA Rental Index

Posted by 7starsdubai on May 3, 2009


source 7Days

A new feature of the Real Estate Regulatory Authority (RERA) web site caused confusion over the expected Rental Index update today, as it seemed to indicate a fall of up to 50 per cent in rental rates.

The new ‘Rental Increase Calculator’ on the web site showed significantly lower rents across Dubai, in what many media reported as an indicator of the updated version of the Rental Index, expected before the end of April.

However, a spokesperson from RERA told 7DAYS that the authority was still working on the index and there was no official update as yet.

The ‘Rental Increase Calculator’ on the web site today showed that a three-bedroom villa in the Springs would now be priced at between dhs140,000 and dhs160,000 a year down by up to 50 per cent from the previous guideline of dhs250,000 to dhs280,000.

A studio apartment in Dubai Marina had fallen to dhs65,000 to dhs70,000 from dhs80,000 to dhs90,000, which would be a discount of up to 28 per cent, while a two-bedroom apartment in Discovery Gardens fell up to 37 per cent, from dhs130,000 to dhs145,000, to dhs90,000 to dhs125,000.

The calculator only recommends any increase in rent if the tenant is paying from ten per cent or more below the low end of these ranges, and in that case, it gives the maximum rent increase as five per cent. In no scenario is the maximum rent increase more than 20 per cent.

RERA had said it would release an updated version of the index first released in January, which was criticised at the time for showing prices nearer to 2008 peaks rather than prices impacted by the global economic slowdown.

The RERA spokesperson today could not confirm when the update would be released.

Go to  www.rpdubai.com

to see the ‘Rental Increase Calculator’

Posted in Dubai | Tagged: , | Comments Off on Confusion over RERA Rental Index

Dubai law pins down property defaulters – If the developer has not been able to start construction “without any negligence or omission on the developer’s part”, the developer may keep 30 per cent of the money paid by the buyer to that point

Posted by 7starsdubai on April 19, 2009


source The National

The Dubai Land Department is planning to issue an amended property law that will determine refunds for investors who default on their payments based on construction progress of the project, according to lawyers briefed on the matter.

The move will bring clarity to the property market in Dubai, where a credit squeeze and the effects of the global financial crisis have led to defaults by home buyers. But some investors have criticised the amendment for being too heavily in favour of developers.

Lawyers say the amendment to article 11 of Dubai Law 13 of 2008 will stipulate that in cases where a buyer defaults and the developer has constructed at least 80 per cent of the project, the buyer loses all money paid to that point. The home can then be auctioned to compensate the developer for the rest of the cost.

If a developer has completed at least 60 per cent of the project and the buyer defaults, the developer is entitled to keep 40 per cent of the purchase price.

But if a developer has completed less than 60 per cent of the project, it can only keep 25 per cent of the purchase price.

If the developer has not been able to start construction “without any negligence or omission on the developer’s part”, the developer may keep 30 per cent of the money paid by the buyer to that point.

Developers would have to refund any money due to the purchaser within one year, or within 60 days of the resale of the home.

A legal briefing from the law firm Clyde & Co said the amendment “provides much anticipated clarification regarding the procedures required to be followed by developers in respect of defaulting purchasers, as well as the rights of developers to retain purchaser monies upon cancellation”.

The original law specified that if a buyer defaulted on payments to the developer, the buyer would be able to recover 70 per cent of any money they had turned over to that point.

But when the property market started to face difficulties last autumn, the Real Estate Regulatory Agency (RERA) issued an interpretation of the law that said the developer could retain 30 per cent of the total price of the property. In some cases, this meant the developer could keep all payments a buyer had made to them.

Officials from RERA later admitted that the interpretation was an emergency measure intended to prevent a wave of defaults that would cripple the property sector.

The new amendment, called Dubai Law No. 9 of 2009, will not only provide more specific terms but be retroactive for all property contracts signed in Dubai. If a contract between a buyer and a developer has a contrary clause, it will be rendered void, according to the Clyde & Co briefing.

Emad Eldin Farouq, a senior legal counsel with the Dubai Land Department, told a panel last week that the amendment had been signed into law and would soon be published in the official gazette of Dubai, according to an article in Xpress, which first reported the story. The amendment would “maintain the confidence of investors and safeguard the real estate of Dubai”, Mr Farouq said, according to Xpress.

But some investors said the amendment did not go far enough in protecting investors from developers who had delayed construction indefinitely.

“It is taking away our rights from the way the law was originally written,” said Nigel Knight, a homebuyer and member of the Dubai Property Investors Group.

The investors’ group handed the Land Department a petition last week asking for a meeting to discuss concerns it has with the amendment.

A Dubai Land Department spokesman could not be reached yesterday.

Posted in Dubai | Tagged: , , , | 2 Comments »

Comment of the day

Posted by 7starsdubai on April 14, 2009


Comment by “Criminology Professor” to Al  Fajer Properties – April 8, 2009 – Dubai court postpones 1,9 Billion Dollar case against Sheikh Maktoum Hasher bin Juma Al Maktoum, Sheikh Hasher Maktoum Juma Al Maktoum and Sheikha Maryam

In criminology, state crime is activity or failures to act that break the state’s own criminal law or public international law. For these purposes, A “state” is defined as the appointed officials, the bureaucracy, and the institutions, bodies and organisations comprising the apparatus of the government. In this situation the sheikh is not alone, the role of the state as one of the possible perpetrators of crime whether directly or in the context of state-corporate crime must be examined.

One way of examining state crimes is to study the occurence of a trend by the state security forces, whether the state respects human rights in the exercise of its powers.

A classical situation is when, the state is directly involved in excessive secrecy and cover-ups, disinformation, and unaccountability which often reflect upper-class, royalty and nonpluralistic interests, and infringe human rights and the state laws. One of the key issues is the extent to which, if at all, state crime can be controlled. Often state crimes are revealed by an investigative news agency resulting in scandals but, even among first world democratic states, it is difficult to maintain genuinely independent control over the criminal enforcement mechanisms and few senior officers of the state are held personally accountable. When the citizens of second and third world countries which may be of a more authoritarian nature, seek to hold their leaders accountable, the problems become more acute. Public opinion, media attention, and public protests, whether violent or nonviolent, may all be criminalised as political crimes and suppressed, while critical international comments are of little real value.

In a state where there is dictatorship and reoccurence of State Crimes, it will result in fostering organized crime, corruption, and authoritarianism. In some third world countries, this political atmosphere has encouraged repression and the use of torture.

JUDGING THIS CASE AGAINST THE SHEIKHS:
THIS IS A CLASSIC EXAMPLE OF A STATE CRIME, WHERE THE STATE INSTITUITIONS BREAK THE RULE OF LAW TO SERVE THE ROYAL FAMILY MEMBERS

Posted in Dubai, Jumeirah Business Centre | Tagged: , , , | 3 Comments »

Diary of a distressed property investor, Part IV – – RERA and other Departments you need to survive ? your property nightmare in Dubai

Posted by 7starsdubai on April 1, 2009


source Kippreport

We know that property investors are struggling, and for the most part, we know why. But what most of us don’t know are everyday struggles they’re going through. One investor agreed to write a journal of her experiences for Kipp. We asked her to be ruthless: she obliged.

Click here to read Part I

Click here to read Part II

Click here to read Part III

Ah Rera. I loved the new regulations and announcements you made over the past eight months, and the threats you were making to incompliant developers raised my hopes that you’d come through for me.

I was wrong. Mind you, I know you have good intentions. All the announcements you’ve made recently are very nice, but it’s too bad that no one in your building has heard of them.

After months of waiting for my good-for-nothing developer to come through with either an announcement that they’ve broken ground or that they’ve cancelled the project, I decided to go to Rera to understand my rights, and to know what I would need to do to cancel my contract and get my money back.

Before I went, I called the authority a number of times to know what documents I needed to have with me to argue my case. Aside from the contract and the receipts, Rera asked me to prepare a letter explaining everything that had happened up until that point, and to outline – in detail – why I wanted to cancel my contract. I wrote it, printed it and filed it along with the hundreds of papers I had gathered about my developer.

I was ready!

Unfortunately, however, Rera wasn’t. I was told to get a number and wait for my turn at counter two. There was no one attending to counter two. I waited. I sat there with a file on my lap determined not to lose my temper, and waited for over an hour and fifteen minutes. No one showed up. I asked around if someone actually works at counter two, and I was told to be patient. So I waited some more.

And then, the guy sitting at counter one asked me what my issue was. I told him, and he said: ‘You shouldn’t be waiting here. You should go to the fourth floor, room 413, and speak to a legal consultant.’

So I went to room 413, where I found a waiting room with three people: two men and one woman, each sitting behind a desk chatting. I sat down and waited. Finally, one of the consultants turned to me and asked me what the problem was. I explained the whole thing. He said I should take my case to the Dubai Courts, and to speak to someone in the real estate section. I asked him why I had been told to come to Rera. He said he didn’t know.

Neither did I.

So I went to the Dubai Courts. I asked where the real estate department is, and I was taken by a helper to the department, and that’s when it hit me: no wonder developers feel they can do what they want. The department was made up of four men, two of which were throwing paper balls at each other, the third guy, the receptionist, was playing a game on his phone, and fourth man, the only one who was helping, was neither in mood nor capable of speaking English.

I spoke to him with my broken Arabic, explaining the mess I’m in and what I need from my developer (my money, my dignity, plus 9 percent interest). He was helpful, and once we got talking, he proved to be helpful. But the process he outlined hurt my brain.

He told me to draft a letter stating all the laws my developer has broken, and have it translated in Arabic. Then I should go to the public notary at the Dubai Court and have the letter authenticated. The court would then send the letter to the developer in the hopes that the mavericks would run to their escrow account and withdraw my cash.

If that doesn’t work, he said, go to court.

Court! I have never gone to court before. I didn’t even know how much hiring a lawyer costs. So I called a number of British and Emirati law firms to get an idea.

Apparently, here’s how it works: if I seek legal representation from a foreign lawyer, I’d have to pay him or her up to AED1,800 an hour for the ground work, but I’d also have to pay court fees and hire a local lawyer – who’d get up to 15 percent of what the court awards me – if my case goes to court. So, my foreign lawyer would act as a consultant to my local lawyer; in short, I’d have a team of lawyers, and I could kiss my present and future savings goodbye.

Or, I can go straight to a local lawyer and pay him or her directly. But then I wouldn’t have peace of mind.

It’s a tough choice, especially given that what little money I have is tied in a phantom property.

I was ready to give the translator and typist the letter that I drafted for Rera, but then I realized that I still have no idea what my rights are. How am I supposed to know if my developer has broken property laws if I don’t know what the laws are? And what am I supposed to understand of the property laws if most of the people I encountered at Rera and the court each told me a different story? The only laws I can reiterate are those that have appeared in the press, such as the much-contested and highly controversial Law 13. And to be fair, I don’t even know what it actually says, I just like the fact that investors have won cases because their lawyer’s cited it in court; last week an investor won his money back because his developer failed to register the transaction 60 days after it took place…thank you Law 13.

Incidentally, does anyone know how to find out whether your property or transaction has been registered with the Land Department?

In any case, I decided against having my letter translated. I didn’t want my developer to read a ‘threatening’ letter that had gaps. I wanted them read something that’ll knock them unconscious.

All I need now are the laws. Does anyone know where I can find them…in English?


Posted in Dubai | Tagged: , | 1 Comment »

After the gold rush: Getting paid in Dubai

Posted by 7starsdubai on March 27, 2009


source building UK

It is claimed that the average contractor is owed £50m, while some consultants’ fees are being slashed in half. Roxane McMeeken finds out just how bad Dubai’s payment problems have become

Dubai is looking more and more like a place with a great future behind it. You can see that most clearly on the billboards erected beside empty sites and motionless tower cranes. “Ordinary is for other people” says the one where the Trump Tower was to have gone. Well, nemesis follows hubris: at least half of the emirate’s construction projects are “on hold” according to research firm Proleads, and nobody knows when, or if, they will start again.

New signs of the desperate state of Dubai’s developers are emerging every day. To look at the top three of them is telling: Union Properties has admitted it would welcome a merger after shelving its flagship £320m Formula One theme park in Dubailand. Emaar recently announced yet more cancelled projects: Asmaran (a 70 million ft2 , £17bn mixed-community scheme billed as “a jewel in the desert”), Maysan (three residential towers, also covering 70 million ft2) and Warsan (500 villas covering 3.4 million ft2). Meanwhile, Nakheel is facing a fraud investigation and has put its £2bn mall expansion plan on hold. It has also been hit by the halving of property prices on its celebrated Palm Jumeira project. Four-bedroom garden homes on a frond are going for £1.2m compared with £2.6m in July.

Where does all this leave the British consultants and contractors who count these developers among their top clients?

The short answer is, cash-strapped. Some are seeing their fees slashed – a Building survey of more than 150 people working in the UAE found that two-thirds of them have been asked to drop their prices recently. Others have been waiting for payments for six months and many are considering legal action.

What went wrong?

The first problem was that many developers were reliant on bank credit rather than oil revenue, as is often thought. Abu Dhabi, the capital of the UAE, has about 10% of the world’s oil, but Dubai has almost none. Banks were happy to keep lending to its developers as long as property prices were going up, and could act as collateral for more lending and more construction. But when property prices started tumbling, this virtuous circle turned vicious and clients ran out of money to pay consultants and contractors.

Abu Dhabi’s $10bn (£7bn) loan to Dubai announced in February appeared to offer a glimmer of hope, especially when the Dubai government said this money would mainly go to state-linked developers. But questions are being raised about how far it will go. For one thing, Dubai has declared that it owes at least $80bn (£56bn), of which almost a quarter falls due for repayment this year. The boss of a UK consultant with a large presence in Dubai says: “The $10bn won’t even cover developers’ interest payments.” He adds that compounding this is the fact that Dubai has so few ways to make money. Last year, 65% of its GDP was from real estate. He adds: “And there is no oil, no exports, no tax and 80% of the population are expats, many of whom are leaving.” Now the fee cuts are spreading to Abu Dhabi, where developer Aldar has written to consultants to ask them to cut fees – on live projects by up to 20%.

Late payments and fee cuts

So how bad has it got for UK firms? Certainly there is no sign that the government cash is filtering through. A senior source at a UK contractor in Dubai is fuming. He says: “The average contractor here is owed about £50m.”

A source at a UK project manager says some payments from Dubai developers are up to six months late; Mace and EC Harris are saying openly that it is taking at least three months to get paid. WSP is estimated to have set aside £4m to cover bad debts and project management consultancy Blair Anderson now employs someone full-time solely to chase payments in Dubai.

Meanwhile, the head of a British specialist working on a major project that stopped in October says his firm was paid 20% of what it was owed in January. He said he has no idea when he will get the rest, although he believes it will come through eventually, as his client is linked to the Dubai government.

Then there are the fee cuts, which are affecting most firms. Evan Anderson, group director of Blair Anderson, says the firm’s fees are between 20% and 30% lower than six months ago. But he is still better off than many architects, whose fees Anderson is renegotiating on behalf of clients. He says: “We are doing a lot of reverse briefing of designers. We’re asking them to cut their fees by up to half and to change the materials they’re specifying to bring down costs by about 30%.”

Contractors across Dubai are having to renegotiate tenders, typically resulting in 15-20% being lopped off their money. The senior contractor says: “Contractors here had been enjoying margins of seven, eight or nine per cent. Now clients are trying to get us to take margins as low as three or even one per cent. They also want to lengthen programmes so that cash flow is less onerous. It’s chaos.”

More pain for consultants is arriving in the form of deferred payment plans. Mark Prior, head of the Middle East for EC Harris, says: “We are discussing deals that would mean we will be paid in six months’ time – or half of what we’re owed in three months and the rest in six.”

Other companies are understood to have been forced to accept payment in the forms of stakes in a development. George Grant, operations director for infrastructure at M&E specialist Drake & Scull, says: “We have no experience of taking equity instead of cash but we would consider it. Our view is we want to work with the clients if it means that work goes ahead.”

“We are doing a lot of reverse briefing of designers. We’re asking them to cut their fees by up to half and to change the materials specified”
Evan Anderson, Blair Anderson

Others are more wary. Anderson has refused payment in shares: “They offer you 1% of a development that you have had no involvement on and no idea how it works. If you invest in something you want to do detailed research on it.”

Meanwhile, the old model of developers paying contractors with money from sales of units in buildings before it has been completed is a thing of the past. Projects launched on this model are being refinanced. Under the new deals institutional investors are brought in and contractors are forced to accept deferred payments.

Anderson says: “The previous model based on off-plan sales is no longer viable, so total financing is being done by investment, and selling is happening when the building is under construction.”

As a result, development is less gung-ho, he adds, which in turn means people are earning lower fees over a longer period. Developments are being built in phases. “Before, a developer would build three high-rises at once; now they are building them one by one. They build a tower, sell it, then use the proceeds to build the next one.”

Such is the state of the market that those who are actually getting paid do not want to admit it. Speaking on condition of anonymity, the head of a British architect’s Dubai office said: “I would rather you didn’t put my name in your article because if other people working for my client find out that I’ve been paid, they’ll be demanding that the client pays them too, and then I’ll have to answer to the client.”

He says at the moment you have the best chance of being paid if you are needed to help with the process of putting a project on hold. “If you are not essential – that is, if you are not putting remedial works in place so the client can put work on hold – you will not get paid.”

Will developers ever pay?

The gravest concern of all is caused by rumours that some developers are about to go bust. Despite their government links, there is no guarantee the state will step in to save these firms. A source at a project manager in Dubai says: “It’s impossible to say whether the government will pay developers’ debts or not. State sponsorship is relatively loose here. Nobody knows whether certain developers are going to be mothballed, merged or go bust.”

Drake & Scull’s Grant, a Middle East veteran, says: “There’s no doubt some clients have run out of money and will disappear. Not the big names though, they need to renegotiate their finance deals but they will carry on.”

He may be right, but the question of when they will pay is still causing UK firms to fret. Emaar, to take one developer, has just had its debt downgraded by Standard & Poor, the ratings agency, from –A to BBB+. It made a loss of 1.6bn dirhams (£304m) in the last quarter of 2008. Meanwhile, the government has warned that the economy may shrink in the second half of 2009.

Most developers are declining to comment on the payment issue, including Nakheel. A spokesperson from developer Limitless did speak to us and insisted that all creditors would be paid. She said: “We’re renegotiating some payment plans, but not all, as part of our overall response to the global situation.”

An Emaar spokesperson also sent the following statement: “Payments for contractors and consultants are based on a credit cycle and set deliverables agreed with them. All payments that meet the criteria have been honoured and will continue to be cleared, in line with our agreements.”

But for those still waiting to be paid and suffering, what recourse is there? Another source says: “Historically, if you’re not getting paid here, you don’t rock the boat; the last thing you do is resort to litigation. But now people are getting highly emotional. If you’re working on a huge project and you recruited a huge team to do it, and you’re owed millions, well maybe it is time to sue.”

He adds that he expects to see “some big disputes in the next three months”, which is perhaps ironic considering that Dubai is aiming to become a regional dispute resolution centre. Prior is among those who admit that “litigation is an option we have our eye on”. It’s a statement that would have been unthinkable in Dubai a year ago.

As the legal cases loom (see box, previous page), it’s clear that relations between clients and project teams are strained to the limit. The head of another UK consultancy, who asked not be named, revealed a conversation he had with a senior emirati working for a big developer. “I said to him, if I don’t get my money, I will sue. He said, you will never work in Dubai again. I said, why would I want to?”

Disputes in Dubai

Dubai’s legal system is facing a sudden rush of disputes, and there are doubts about how well it is going to handle them. The first problem is the absence of adjudication. Paul Taylor, a partner at lawyer HBJ Gateley Wareing, says: “Unlike in the UK, there is no quick fix in Dubai. Here, arbitration and litigation, are the only ways to get your money.” Even worse, arbitration in Dubai takes up to two years – even longer than in the UK.

Another problem is certification. Of course, getting an engineer’s certificate proving you have done the work and are therefore entitled to be paid is an important piece of ammunition in the fight for your fee. However, in Dubai, Taylor says many contracts include a clause saying that an engineer cannot approve a piece of work without the client’s sign off. “These clauses are being disputed, but it’s still tough.”

People are looking at alternative methods of resolving disputes. Next month a “mediation centre” is being set up that will fast-track dispute resolution through an independent party. Taylor says it is a mid step between amicable settlement and arbitration and could resolve a dispute in two or three weeks. The problem, though, is that it will only work if both parties voluntarily accept the verdict.

Most projects are on the FIDIC contract. The 1999 version contains a clause that allows the use of a dispute resolution board, which can take six to 12 weeks. Earlier versions of the contract do not tend to offer this option.

Even if you do resolve a dispute to your satisfaction, then you have the problem of enforcing the decision. Taylor recommends a “more commercial” way of tackling a dispute. “Knock on the client’s door and try to explain your difficulties face to face. And get your local sponsor to act as an intermediary.” As a last resort, you can threaten to terminate the work you’re doing for the client – an approach that will only work if the project is continuing.

Posted in Dubai | Tagged: , , , , | Comments Off on After the gold rush: Getting paid in Dubai

Property Disputes Dubai – Mediation Centre

Posted by 7starsdubai on March 27, 2009


source The National

Dubai has created professional groups and a mediation centre to resolve the hundreds of disputes that have arisen among investors and developers as the property sector soured in the global economic downturn.

The initiative, an effort by the Dubai Land Department and the Dubai Real Estate Regulatory Agency (Rera), is designed to integrate the main participants in the property industry into a regulatory framework headed by Rera.

A mediation centre was established to help resolve disputes faster, away from Property Court. Currently, more than 500 cases are said to be pending with the court.

Read the rest of this entry »

Posted in Dubai | Tagged: , | 1 Comment »

The British government is being asked to help U.K. investors in Dubai who fear losing millions of dollars in the sheikdom’s collapsing property market.

Posted by 7starsdubai on March 27, 2009


source WallstreetJournal by Stefania Bianchi

A group of investors based in the U.K. have sent a petition to Prime Minister Gordon Brown asking him to intervene in what they claim are “harmful real-estate practices” in the United Arab Emirates.

“We as investors have recently discovered the blatant embezzlement of our money by unscrupulous developers,” the petition, seen by Zawya Dow Jones, says. The petition was referred by Downing Street to the Foreign Office.

“We have been contacted by individual investors,” a spokesperson for the U.K. Foreign & Commonwealth Office told Zawya Dow Jones. “The FCO takes this matter seriously.

A near 50% fall in real estate prices in some parts of Dubai has spurred a rash of increasingly ugly real estate disputes between developers and investors. The industry accounts for 30% of the emirate’s economy.

The Dubai Land Department estimates that British investors own property worth 4.7 billion U.A.E. dirhams ($1.3 billion) in the emirate. British buyers now account for 12% of international property investors in the emirate, behind Saudis and Indian buyers, according to regional investment bank EFG Hermes.

The involvement of the British government on behalf of disgruntled property buyers will further damage the reputation of Dubai as it struggles to clean up its financial image and attract foreign investment that’s vital for its economy.

The Foreign Office spokesperson said that while the British government would advise investors on how to resolve disputes “ultimately this is a legal matter between the interested parties.”

Dubai’s Real Estate Regulatory Authority, the government watchdog, didn’t respond to written questions from Zawya Dow Jones, but Thursday said it plans to set up new “real-estate communities” to increase transparency.

INTERVENTION<br />

British national Nick Jasani is one of a group of investors who is lobbying parliamentary representatives to put pressure on Downing Street to intervene in the rising number of disputes on their behalf.

Jasani, who bought a commercial unit from a developer in Dubai’s Business Bay district for AED2 million in early 2007, is worried because construction at the project hasn’t started, even though he’s already paid AED640,000 or 30% of the unit’s value.

He said the Dubai-based developer is still demanding payment installments even though they’re not working on the project.

A letter seen by Zawya Dow Jones and sent by a number of individual investors to Members of Parliament states that “even though projects have no hope of going ahead due to the current financial climate, the money (investors) they have put down may not be refunded.”

As the bottom falls out of Dubai’s once-soaring property market, developers are scrambling to respond. Many are being forced to cancel or delay projects amid falling sales and property prices.

Last month, a report by investment bank Morgan Stanley (MS) said the United Arab Emirates is delaying or canceling real-estate projects worth more than $260 billion. An earlier HSBC PLC (HBC) report said Dubai is delaying or canceling almost 60 projects worth $75 billion.

Amid growing uncertainty about whether they’ll see their money again, investors are organizing themselves to take on the emirate’s sometimes unscrupulous developers and convoluted real-estate regulations.

This week a group of more than 100 investors delivered a petition signed by more than 350 investors to Dubai developer Nakheel’s office urging the firm to reschedule payment plans for villas on Palm Jebel Ali because of delays.

This followed a petition to Emaar Properties (EMAAR.AI), the Middle East’s largest developer, requesting the cancellation of three of its projects.

Nakheel didn’t respond to questions from Zawya Dow Jones.

“There are certainly a number of investors who seem to have claims with merit. Others simply have been caught out by a falling market and insufficient contractual protection,” said Matthew Hooton, head of real estate in the Middle East for law firm Ashurst.

Posted in Dubai | Tagged: , , , , , | 1 Comment »

European investors seek RERA and government intervention in protracted dispute with Jumeirah Waves Business Towers project – Al Tayer

Posted by 7starsdubai on March 22, 2009


source Zawya

a-letter-to-dubai-falconJumeirah Waves Business Towers project in Jumeirah Village South remains undeveloped more than two years after investors purchased units from developer.

in Dubai who have bought units in the Jumeirah Waves Business Towers (JWBT), a commercial development project comprises 3 identical towers located in Jumeirah Village South (JVS), are urging government authorities in Dubai, Real Estate Regulatory Agency (RERA) and master Developer of the JVS project, Nakheel, to intervene in an ongoing dispute with the project developer High Rise Properties, a protracted conflict that the complainants claim could potentially hurt the overall investor confidence in Dubai and ultimately deliver a negative impact on Dubai and the United Arab Emirates’investment landscape. A number of European investors revealed that the developer has not started any substantial work on the JWBT developments and has also been unwilling to entertain requests by investors for a refund and compensation since selling to them the units almost two and a half years ago.

The affected investors claimed that up to 50 per cent of the entire units in the 3 towers have been sold out, while buyers have paid between 15 to 60 per cent of the total amount of their respective units. The complainants further said that they do not believe that the delay in the start of construction of the JWBT has been caused by the ongoing global financial crisis since construction work on the project was actually supposed to have started more than two years ago – at the height of the real estate boom in Dubai and the region.

“It has been more than two years since our group and other investors have purchased units in the JWBT development; but until now the project area is still undeveloped and the developer –High Rise Properties- has remained elusive and unable to give us a reasonable time table for the development. There is certainly a breakdown in transparency and accountability somewhere and we urge the concerned government authorities in Dubai, mainly RERA and Nakheel, to step in and resolve this problem before it goes out of hand and negatively affect investor confidence in Dubai,” said Richard Moore, a representative of the affected European investors.

“High rise Properties have given a lot of excuses and promises, but nothing concrete has been done to at least make the investors feel that their investments are being safeguarded. It is not just the money that we have invested in this project that”s at stake here; this kind of attitude by a developer will certainly cause further damage to the reputation of Dubai”s real estate sector at a time when the industry is supposed to be consolidating its forces and building its image to limit the ill-effects of the global financial crisis,” added Moore.

The investors further pointed out that the JWBT developer, High Rise Properties, a company controlled by the influential and powerful Al Tayer family, has earlier made several excuses for being unable to start the project, including an alleged two-year delay in the turnover of the allocated land. The investors also claimed that the project has been registered with RERA, which makes the developer and its owner Abdul Hakim Al Tayer, fully accountable to the government. However, the complainants have urged concerned authorities to act swiftly and with full transparency on the matter as they fear that Al Tayer family may use its clout to influence the result of any investigation that may arise.

Abdul Hakim Al Tayer and the management of High Rise Properties have been uncooperative and we are left with no other resource but to ask the government to help us settle this issue. Naturally, we can”t allow our investments to lay idle for an extended period without knowing what the future holds for the project. Moreover, there is obviously something wrong within this organisation considering it has been two years and they have not made any effort to push this project or reach a settlement with affected investors. Surely, the government must take a look at this case, considering its potential impact on the future of Dubai”s investment climate,” concluded Moore.

For further information and queries pls contact:
Richard Moore
Representative of a group of European Investors in Dubai
e-mail: EuroInvestInDubai@gmail.com

To contact RERA:
Call Center : +971 – 4 – 222 – 1112
Fax No : +971 – 4 – 222 – 2251 ,
Phone No : + 971 – 4 – 222 – 2253
Dubai Land Department,
Real Estate Regulatory Agency
www.rera.ae

To Contact High Rise Properties:
HIGH RISE REAL ESTATE L.L.C.
Telephone: + 971 4 3212120
Fax: + 971 4 3212128
P.O.Box: 11559 Dubai, U.A.E
Email: info@highrise-re.com
Toll Free: 800 HIGHRISE (44447473)
www.highrise.ae

Posted in Dubai | Tagged: , , | Comments Off on European investors seek RERA and government intervention in protracted dispute with Jumeirah Waves Business Towers project – Al Tayer

Worst Case – You need a lawyer in UAE ? …. Lawyers in UAE are highest paid in the world

Posted by 7starsdubai on March 17, 2009


source business 24/7 ae

Lawyers in the UAE are the highest paid – not just in the region – but across the world, say experts.

As per the figures provided to Emirates Business by Acritas, the legal sector researcher based in UK, the average hourly rates for lawyers in Dubai are the highest.

In the UAE, it’s $610/hour (Dh2,240) and within the country Dubai lawyers charge more ($663/hour) when compared to Abu Dhabi ($551/hour).
Read the rest of this entry »

Posted in Dubai | Tagged: , , , | Comments Off on Worst Case – You need a lawyer in UAE ? …. Lawyers in UAE are highest paid in the world

RERA Dubai Project Indicators now online

Posted by 7starsdubai on March 10, 2009


For more information click: RERA Dubai

Posted in Dubai | Tagged: , , | Comments Off on RERA Dubai Project Indicators now online

What must an investor do if he suspects a developer isn’t meeting construction milestones?

Posted by 7starsdubai on March 9, 2009


original published GulfNews

Article (17) of Law No (8) 2007 is introduced, what must an investor do if he suspects a developer isn’t meeting construction milestones?

Law No (8) of 2007 came into effect on June 28, 2007.

Article (17) details circumstances under which a developer shall be cancelled from the Register of Developers. One circumstance is that the developer has failed to start construction within six months of being granted permission to sell off-plan, except
if the developer has an acceptable excuse.

No developer may carry out real estate development activities unless it is on the Register of Developers. Under Article (17), the Land Department is in charge of the Register of Developers and therefore where an investor feels a developer
is in breach of Article (17) and they cannot sort the matter between themselves, the investor should approach the Land Department
to help resolve the issue.

If I’m already an off-plan investor, will the new law be
of assistance to me too?
Law No. (8) of 2007 applies to contracts between investors and developers whether signed before, on or after June 28, 2007. While that law does not oblige a developer to use a payment schedule that is linked to construction milestones, RERA has recently made three recommendations.

Firstly, each developer will be restricted from collecting more than 30% of payments on developments until the developer started construction. Secondly, each developer will be precluded from selling off-plan until (i) it owns the land to be developed and (ii) it has completed
at least 20% of construction.

Thirdly, each payment plan must link payment installments to milestones in  the construction of the development. Although these recommendations are not yet law, this seems to be
RERA’s intention.

Under the new rental regulation, how do I know whether the cap applies to the property I’m leasing?

If property was rented during 2008 and the rent in 2008 was between the average standard rent and 75% of the average standard rent, then the rent in 2009 may not be increased (certain increases are permitted where the 2008 rent was less than 75% of the average standard rent).

A property’s average standard rent will likely be halfway between the low figure and the high figure for rents in that area in Dubai. (For details go to http://www.rpdubai.ae.)

I’ve heard that if investors have disputes with a developer and want to pursue matters further, they need to put down 7.5% of the total cost of the investment as a down payment, before they will be heard at a tribunal. Is this true?
In the contract between the investor and the developer, there will be a clause that states whether disputes are to be resolved before the Dubai Court or at arbitration. This clause will state the conditions (if any) that must be satisfied before a dispute goes to court or to arbitration.

 
It is possible that a specific contract would require payment of a given percentage of the purchase price,
but there are no hard-and-fast rules.
The investor should carefully read the terms of his contract in order to establish his position.  

Posted in Dubai | Tagged: , , , | Comments Off on What must an investor do if he suspects a developer isn’t meeting construction milestones?

RERA Dubai – Dubai Property Investor Group Petition – Surprise

Posted by 7starsdubai on February 22, 2009


http://www.thenational.ae/article/20090222/BUSINESS/942576581/1051/rss

DUBAI
The Real Estate Regulatory Authority (RERA) and a group of private property investors will combine to create an investor’s advisory panel that will provide feedback to the Government as it tries to resolve disputes.

Marwan bin Ghalita, the chief executive of RERA, agreed to the plan during a meeting with the Dubai Property Investors Group, a coalition of more than 350 investors that was formed after sales began to slow last year. Group members say they are concerned about the safety of their investments and ability to get their money back if a developer cancels a project or refuses to start construction.

“We want to protect the real estate investors,” Mr Ghalita said. “We are studying project by project… Once we have enough information about a project, we will intervene as a regulator.”

Ludmila Yamalova, a lawyer with MAC Davidson & Associates and a member of the investors group, said she was encouraged by the meeting with Mr Ghalita.

“Until today’s meeting, we felt that the Government was in denial,” she said. “But he was very welcoming to investors. He said we all made mistakes, investors and developers. Now we need to solve the problems and move forward.”

Read the rest of this entry »

Posted in Dubai | Tagged: , , | 1 Comment »

CEO RERA Dubai: “Dubai is like a movie star, and just like a movie star everyone is looking at us, adding more pressure.”

Posted by 7starsdubai on February 13, 2009


KippReport

http://www.kippreport.com/kipp/2009/02/12/is-dubai-acting-smart/?bnr=1

confusion“Dubai is like a movie star, and just like a movie star everyone is looking at us, adding more pressure.”

That’s what Marwan Bin Ghalita, the CEO of Dubai’s Real Estate Regulatory Agency (Rera) told Emirates Business, explaining that the city’s success is leading to incorrect media rumors about cancellations of property projects in the city.

A recent report by HSBC said that $75 billion worth of projects are being cancelled in the UAE, but a Morgan Stanley report put the number at $263 billion.

Rera’s CEO, however, says the authority is still “studying the market at present.” He rubbished a list that is doing the rounds, telling Al Bayan that “The list was not accurate and not true simply because it was not issued by Rera, Department of Lands or any official relevant body. Those behind the list are only seeking to raise fears and panic so as to make narrow gains.”

“We understand the feelings of worry resulted from the impact of the global financial crisis but we are against the unjustifiable panic, exaggeration and hitting under the belt by some for the sake of making illegitimate ends,” he added.

While the list is possibly inaccurate (Kipp did try to ascertain some projects earlier, but was unable to confirm the status of several projects), it has been more than three months since the effect of the economic slowdown began to be felt in Dubai’s real estate sector.  Hundreds of people have been laid off from their jobs in the property sector, with developers blaming it on postponement or cancellation of projects; and financial houses like HSBC and Morgan Stanley have already come out with their lists.

Rera will be releasing “accurate data next week that would show the true picture of Dubai’s real estate market.”

“We didn’t announce any cancellation of projects especially those sold to investors, and this is a stabilizing factor which can contribute to further boosting confidence in the vibrant real estate market in Dubai,” Ghalita told Al Bayan. “We want to send a clear message that we have confidence in the city,” he told Emirates Business.

Well, Kipp isn’t sure how confident investors are of the movie star’s talents.

 

Posted in Dubai | Tagged: , , , , , , | Comments Off on CEO RERA Dubai: “Dubai is like a movie star, and just like a movie star everyone is looking at us, adding more pressure.”

RERA Hits Back – Dubai RERA CEO said: “The investor should feel happy when he sees the authorities hit with an iron fist all those who put interests of the city and investors at risk.

Posted by 7starsdubai on February 13, 2009


http://www.7days.ae/storydetails.php?id=73857&title=RERA%20hits%20back

justice2Dubai Real Estate Regulatory Authority (RERA) has denied receiving a letter signed by 300 real estate investors, developers and advocates expressing concerns over the fate of their investment in the emirate.

In their letter, they demanded RERA act before prices in the real estate market crash, according to a report published by Zawya Dow Jones news web site, which also blamed the RERA CEO of declining to comment on the issue.

Marwan bin Ghalita, CEO of Dubai Real Estate Regulatory Authority (RERA), branded the news as absolutely untrue. “Personally, I did neither receive a letter of this kind nor any call from the said news web site or other,” he affirmed in a statement.

He added that RERA could not have made any regulatory achievements in the real estate market if it had not been keeping regular contacts with developers, brokers and investors alike.

It was reported that the petitioners demanded RERA to take measures to bring the situation under control especially following recent financial investigations into several property companies, a move which raised questions about RERA standards.

Commenting on this, the RERA CEO said: “The investor should feel happy when he sees the authorities hit with an iron fist all those who put interests of the city and investors at risk. It’s illogical that such a measure could feed concerns… on the contrary it should send a message of confidence and assurance across the board.”

marwanbinghalita-reraHe explained that RERA had, since its creation about one year ago, been taking tremendous efforts to regulate the real estate sector by issuing flexible regulations at bar with the highest possible level of transparency.

Answering a question about a list being circulated on the internet about tens of cancelled or delayed developments, the RERA CEO affirmed: “The list was not accurate and not true simply because it was not issued by RERA, Department of Lands or any official relevant body. Those behind the list are only seeking to raise fears and panic so as to make narrow gains.”

Posted in Dubai | Tagged: , , , , | Comments Off on RERA Hits Back – Dubai RERA CEO said: “The investor should feel happy when he sees the authorities hit with an iron fist all those who put interests of the city and investors at risk.

RERA chief Marwan bin Ghalita denies petition from worried investors

Posted by 7starsdubai on February 12, 2009


the-petition-to-rera-dubaihttp://www.arabianbusiness.com/546550-rera-chief-denies-petition-from-worried-investors

Arabian Business 12. February 2009

what-aboutDubai’s real estate watchdog on Thursday denied reports it had received a letter signed by 300 real estate investors voicing their concern over the fate of their investment.

It was claimed that the Dubai Property Investors Group, made up of more than 300 local and international investors, lawyers and real estate developers, had delivered a petition to the Real Estate Regulatory Authority (RERA).

It reportedly urged the watchdog to clamp down on “fly-by-night developers” who were unable to deliver projects amid tightening liquidity and project financing, even though they’ve taken down payments from investors.

But Marwan bin Ghalita, CEO of RERA, branded the petition story, published earlier this week by newswire Zawya Dow Jones, as “absolutely untrue”.

“Personally, I did neither receive a letter of this kind nor any call from the said news website or other,” he said in comments published by news agency WAM.

He added: “Maintaining a well-regulated market that provides protection to all stakeholders is one of our top priorities.”

He claimed that RERA had, since its creation about one year ago, been taking tremendous efforts to regulate the real estate sector by issuing flexible regulations with the highest possible level of transparency.

“Loss of investor’s rights is a red line…it has not happened and it will never happen in Dubai real estate market…RERA has completed registration of developers and brokers at its records to preserve their rights,” he added.

“We understand the feelings of worry resulted from the impact of the global financial crisis but we are against the unjustifiable panic, exaggeration and hitting under the belt by some for the sake of making illegitimate ends.”

He appealed to investors not to hesitate in calling RERA to know the update of any project and stressed that RERA would never allow developers to breach real estate laws, especially the escrow account system.

___________________________________________________________

For our readers:

Links to the Group who started the  Pettion in January 2009

http://groups.google.com/group/dubai-property-investors/browse_thread/thread/8efbb7983955fc97?hl=en

The Letter of the Petition to Marwan bin Ghalita RERA Dubai

http://dubai-property-investors.googlegroups.com/web/The+Petition144.pdf?hl=en&gda=bIHji0UAAABCDKK3M95qOHhW6MrAvHpOfz2RH571rD459OcQ3HKxoj-z-44yj33cbUGq43XpXhMcn8WIbWh5zqeDKtDBmq67Gu1iLHeqhw4ZZRj3RjJ_-A

 

 

 

 

Posted in Dubai | Tagged: , , | 1 Comment »

Affected Dubai Property Investors started Petition to RERA Dubai in January 2009

Posted by 7starsdubai on February 12, 2009


to get more information please click on this link:

http://groups.google.com/group/dubai-property-investors/browse_thread/thread/8efbb7983955fc97?hl=en

 

the link to the letter, hand delivered Petition, to RERA Dubai Januar 2009, against Real Estate Practices that harm Dubai

http://dubai-property-investors.googlegroups.com/web/The+Petition144.pdf?hl=en&gda=EtP61kUAAABCDKK3M95qOHhW6MrAvHpOv6-qWixPv2gLwjFoEVch5D-z-44yj33cbUGq43XpXhMcn8WIbWh5zqeDKtDBmq67Gu1iLHeqhw4ZZRj3RjJ_-A

or

http://groups.google.com/group/dubai-property-investors/files?hl=en

Posted in Dubai | Tagged: , , , | Comments Off on Affected Dubai Property Investors started Petition to RERA Dubai in January 2009

Dubai Property Buyers may move court for cancelled off-plan contracts

Posted by 7starsdubai on January 30, 2009


http://business24-7.ae/Articles/2009/1/Pages/01282009_c77c5faf7c0e4120b77817701e56af04.aspx

Property buyers can contest their “terminated” off-plan contracts, signed after August 31, 2008, in the newly set-up Property Court, but will have to go through the Dubai Land Department (DLD), a senior government official said.

“The purchaser will be further able to seek compensation from the Property Court if he establishes a ground for the termination,” Emad Eldin Farouq, Senior Legal Counsel, Dubai Land Department, told Emirates Business.

In November 2008, the Land Department in an administrative circular, said developers – not buyers – would have to initiate the official procedure to cancel the off-plan transactions. But for sales contracts, signed before August 31, 2008, the terms and conditions of the contract will be applicable for the two parties under the UAE Civil Code. However, these would not have to go through the DLD.

In the internal administrative circular, the department gave the interpretation of the meaning and practical application of Article 11 of the Law No.13 regulating the interim real estate registration. According to this circular, in case of a termination of an off-plan contract, the developer shall be entitled to 30 per cent of the purchase price plus 30 per cent of the any further monies paid above 30 per cent of the purchase price.

“In case of a cancellation of an off-plan contract where the purchase price is Dh1 million and the purchaser has paid 40 per cent of the property value, then the maximum claim the developer can make is of Dh330,000 (30 per cent of Dh1 million and 30 per cent of the remaining 10 per cent),” he said.

“If a buyer wants to contest this, he can go to the Property Court which shall apply the civil jurisdiction on this. Nobody can prevent the buyer from going to the court. Further, the Property Court may or may not agree with this and they can choose to either cancel these terms or they can adopt it or they can apply any other rules to this. The Property Court will look at it based on the rules and regulation in place under the Civil Code Law,” added Farouq.

Legally any agreement can be terminated either amicably, voluntarily or can be terminated by a court order based on the facts.

Under the Civil Code, the purchaser has the right to terminate the contract if there is a breach by the seller. The purchaser is entitled to refer the matter to the appropriate court with jurisdiction (which is now the Property Court)

Mohammad Kawasmi, Senior Associate Al Tamimi & Company, said: “We are not aware if the administrative circular issued by the DLD will hold true in the Property Court and they can choose to override the circular.”

Earlier this week, Farouq told this newspaper that investors facing cash-flow constraints can approach the Dubai Land Department for rescheduling payments for their properties.

Register online

Developers will have to register their off plan and completed units through the Dubai Land Department’s online registration system, said Farouq.

Called Oqood, the new system will enable effective implementation of Law No13 of 2008 for regulating the interim real estate register in the emirate.

Developed by Emirates Real Estate Solutions for the Dubai Land Department, the Oqood online interim registration process will lead to minimising conflicts arising between developers, investors and sellers, while contributing to cutting down the escalating off-plan selling and reselling costs.

Charges will be the same as levied by the Dubai Land Department – one per cent of the total value paid by the seller and one per cent to be paid by the consumer. Following the issuance of Law No 13, developers now have to register all their units prior to launch of the project and only then can they proceed with their sales.

The law aims to create further consumer ease and protection within the Dubai realty market.

Posted in Dubai | Tagged: , , , | Comments Off on Dubai Property Buyers may move court for cancelled off-plan contracts

Diary of a distressed property investor, Part II

Posted by 7starsdubai on January 9, 2009


original published: Kippreport.com

We know property investors are struggling, and for the most part, we know why. But what most us don’t know are the everyday struggles they’re going through. One investor agreed to write a journal of her experiences for Kipp for the next month. We asked her to be ruthless: she obliged.

We’ve withheld her name for legal reasons.

I went to Rera last week. And when I finally got someone to talk to me about my concerns, I was confronted with a Dubai truth: some government employees’ brains go on vacation well before the public holidays begin. I was advised to return after the New Year’s celebrations.

“Why?” I asked.

“It’s a holiday,” said a young attendant.

“What holiday? It’s the 29th (of December)?” I asked, a little hysterically.

I didn’t get a response from him. And that taught me another Dubai truth: any sign of hysteria, anger, disapproval or discontent on your part will result in an immediate breakdown of communication on theirs.

But rather than wait until 2009 to sort my property situation out, I decided to keep looking for answers and solutions to my problem. Here’s what I discovered:

Read the rest of this entry »

Posted in Dubai | Tagged: , | Comments Off on Diary of a distressed property investor, Part II

Dynasty Zarooni Chairman – Criminal Business Partner of Al Fajer Properties Dubai – arrested

Posted by 7starsdubai on January 5, 2009


http://www.bi-me.com/main.php?id=29498&t=1&c=33&cg=4&mset=

UAE. The head of a Dubai-based real estate firm has denied reports that he had been arrested on allegations of fraud.

Kabir Mulchandani, Chairman of property investment consultant Dynasty Zarooni, said in an interview for Gulf News there was no police arrest warrant against him.

“I know some complaints have been lodged with the police by some people against our firm but these people gave cheques that bounced. They have no legitimate reason to complain,” he explained over the phone.

He said the company was “in good shape.”

Company President Hilal Al Zarouni said the company is “functioning properly”. Both executives said they didn’t know if the police were investigating the complaints.

Lawyer Salim Al Sha’ali, who represents a number of complainants, said the complaints are related to an alleged fraud scheme.

“We have been studying the legalities of the case… and we believe that there is a supposed crime of conning people out of money,” he said.

The Federal Penal Code and the property laws issued lately are the legal grounds in this case, argued the lawyer. Sources said the complaints involve some 30 investors with at least US$1 million each invested with Dynasty Zarooni.

However, Mulchandani denied the accusations and said he has “all the documents that support our position that those people have reneged on their commitments”.

Reports yesterday claimed clients said they paid AED 300,000 per month for which Mulchandani promised a return of AED 1 million a month after the first six installments. But Kabir Mulchandani said that the montly payment was a fee for investors to secure first refusal on properties sold by Dynasty Zarooni at pre-launch prices, an average discount of between 2% and 5%. And he insists no returns were ever guaranteed.

“There is not a single document, email, a fax, an SMS, that anybody can produce in Dubai or elsewhere in the world that in any way represents that we guaranteed any form of return,” he said.

He added that many investors had actually made far more than the guaranteed return he is claimed to have given, despite the slump in the property market.

He said: “This is a case of people having a situation where they can’t meet their obligations, which is unfortunate, but they shouldn’t have over-traded. You can’t buy what you can’t pay for.”

He said those making the complaints against him had bounced post-dated cheques given to the company for both the membership fee and for the properties they purchased.

Mulchandani had left India for Dubai where he set up Dynasty Zarouni, to cash in on Dubai’s booming real estate market.

Kabir Mulchandani is also the founder of Baron International, the Mumbai company that pioneered cheap colour TVs and music systems under the brand names Aiwa and Akai, a firm which came under scrutiny from the DRI and Enforcement Directorate in India.

Dynasty Zarooni markets ready-to-move in properties constructed by Dubai real estate company Al Fajer. The firm advertises these properties on his website and invites NRIs to invest money.

Al Fajer is known for its projects in Jumeirah Business Centre 1 and 2 apart from various projects at Jumeirah Lakes and Jumeirah Island.

Dubai’s Real Estate Regulatory Authority (RERA) is probing the company’s operations after nearly 30 NRIs from India, Russia and UK complained online that he had misled them by showing a different property and selling them another

RERA authorities are reported to have told Indian newspapers that the firm had also not followed the local rule of depositing sale proceeds of real estate properties into a government-shared escrow account.

One particular complaint cites how Mulchandani allegedly sold apartments in a three-tower complex, showing the two completed towers as the properties that were for sale but allotting ownership documents of the third tower which has yet to come up.

Speaking to Mumbai Mirror RERA’s head of legal cell, Imad Hussein, is reported as saying: “We have received complaints of 30 investors from India, Russia and the UK. The company Dynasty Zarouni offered real estate properties at half the market price.

“It also allegedly lured investors by misrepresenting a different property in the name of another. Each buyer has invested at least US$1 million with the firm.”

According to Hussein: “We have invited all investors with similar complaints through advertisements in local newspapers to come forward, and have assured them that RERA will play an active role in safeguarding their money under law number 8 in line with the directives of Dubai’s ruler Sheikh Mohammed.”

Posted in Dubai, Jumeirah Business Centre, Kabir Mulchandani | Tagged: , , , , , | Comments Off on Dynasty Zarooni Chairman – Criminal Business Partner of Al Fajer Properties Dubai – arrested

Law No.7/2006 Concerning Land Registration in the Emirate Dubai

Posted by 7starsdubai on January 5, 2009


Law No.7/2006 Concerning Land Registration in the
Emirate of Dubai
We, Mohammed bin Rashid Al Maktoum, Ruler of Dubai
Having considered the Federal Law No. 5/1985 promulgating the Civil
Transactions Law and its amendments;
the Federal Law No 11/1992 promulgating the Civil Procedure Law and its
amendments;
the Local Law No 7/1997 concerning Land Registration Fees; and
the Local Decree concerning the Formation of Land Affairs Committee of the
year 1960;
do hereby promulgate the following Law:
Chapter One
Title and Definitions
Article (1)
This Law shall be cited as “The Land Registration Law of the Emirate of Dubai
(No 7/2006)”.
Article (2)
In this Law, the following words and terms shall have the respective meanings
assigned to each of them, unless the context requires otherwise:
The UAE :
the United Arab Emirates.
The Emirate:
the Emirate of Dubai.
The Government: the Government of Dubai including any of its
Departments, Authorities or Public Corporations.
The Ruler : His Highness The Ruler of the Emirate of Dubai.
The Department: the Department of Lands and Properties.
The Head: the Head of the Department.
The Director: the Director General of the Department.
Land anything of a permanently fixed nature which cannot
be removed without damaging or altering its form.1
Rights over Land: any principal or accessory rights over Land.
1 The original Arabic word is “‛aqār” which literally means immovable, the equivalent of French
immeuble. The underlying concept of “landed property” may also be expressed by the term “real
estate”.
Land Register: a collection of records kept by the Department in
written or electronic form in an electronic register,
detailing the description of the registered Land, its
location and the rights over it.
Land Unit: any plot of Land and all that is located thereon such
as buildings, plants or otherwise, situated in one
Land Area without being separated from its other
parts by any public or private property and without
any part of it having a right or an encumbrance which
its other parts do not have.
Land Area: a group of Land Units demarcated by principal roads
or fixed and clear signs with an accredited name and
a distinctive number in accordance with the practice
of the Department.
Person: a natural or a legal person.
Chapter Two
Scope of Application and Right of Ownership
Article 3
This Law shall apply to Land situated in the Emirate.
Article 4
The right to own Land in the Emirate shall be restricted to citizens of the
United Arab Emirates, citizens of the Cooperation Council for the Arab States
of the Gulf, the companies totally owned by any of the foregoing, and public
joint stock companies. Foreign Persons may, subject to the approval of the
Ruler, be granted in certain areas the following rights:
(a) The right to acquire absolute ownership of Land without restrictions as
to time.
(b) The right to acquire usufruct or leasehold of Land for a period not
exceeding 99 years.
Chapter Three
General Provisions
Article (5)
The originals of documents and judicial decisions in pursuance of which
registration is made shall be kept in the Department, and shall not be moved
outside its premises. Interested parties, judicial authorities or experts
appointed by them, as well as competent committees may have access to
such originals and obtain a certified copy thereof in accordance with the
provisions of this Law.
Chapter Four
Jurisdiction of the Department
Article (6)
The Department shall have exclusive jurisdiction to register the rights over
Land and the leaseholds mentioned in Article 4 of this Law. For this purpose,
the Department may do any of the following:
(1) determine the areas to be surveyed or re-surveyed and certify the
maps drawn therefor;
(2) prescribe rules in relation to surveying and inspection, as well as in
relation to issuance of maps relating to Land Units;
(3) prepare model forms of contract relating to real estate transactions;
(4) prescribe rules concerning organizing, archiving and destruction of
documents;
(5) prescribe rules in relation to using computers in storing and recording
data;
(6) lay down rules in relation to regulating and keeping a register of real
estate brokers;
(7) prescribe rules in relation to evaluating Land;
(8) lay down rules in relation to voluntary sales of Land by public auction
and supervision of such sales;
(9) determine the fees payable for services rendered by the Department;
and
(10) establish branches of the Department as the Director may deem
appropriate.
Chapter Five
The Land Register
Article (7)
A Land Register shall be maintained in the Department to record all rights
over Land and any changes that might take place in respect of them. This
Register shall be conclusive evidence against all and everyone unless it is
proved to be the result of fraud or forgery.
Article (8)
Subject to the provisions of Article (7) of this Law, all electronic records shall
have the same weight of evidence as that of their hard copy written originals.
Chapter Six
Registration
Article (9)
All transactions that create, transfer, change or cancel rights over Land shall
be recorded in the Land Register and final judgments confirming those
transactions shall also be likewise registered. No transaction shall have any
effect unless registered in the Land Register.
Article (10)
Any undertaking to transfer a Right over Land shall be limited to an obligation
to pay compensation if the obligor is in breach of his undertaking, whether the
undertaking contains a provision to pay compensation or not.
Article (11)
If the estate of a deceased contains Rights over Land then the certificate of
inheritance shall be registered in the Land Register and disposals by any heir
of any of these rights shall not be effective or recognized against third parties
unless registered in the Land Register.
Article (12)
The Department may for the purpose of settlement entertain applications for
registration submitted by Persons in possession of Land that is not registered
in their names.
Chapter Seven
Alterations or Corrections of Records in the Register of Land
Article (13)
The Department may, on the application of an interested party or on its own
initiative with notification to those concerned, correct clerical errors in the
records of the Land Register.
Article (14)
In co-ordination with the relevant authorities, the Department shall update its
records of Land Units and of what is located thereon such as buildings, plants
or otherwise.
Chapter Eight
The Maps
Article (15)
(1) For the purpose of the registration of Land Units and Land Areas, the
following maps shall be relied upon:
(a) typographic master map;
(b) map of Land Unit; and
(c) map of Land Area.
(2) Each Land Area shall have its own separate map indicating the Land
Units located on it and the numbers thereof.
(3) Each Land Unit shall have its own separate map indicating its site,
boundaries, width and length, area, its features, constructions located
on it and the numbers given for its neighboring units.
Chapter Nine
Dividing and Merging
Article (16)
If the dominant Land Unit is divided up, the right of easement shall remain in
existence in favour of each part of it, provided that that does not increase the
burden to the servient Land Unit. However, if the right benefits only some of
such parts, the owner of the servient Land Unit may apply to the Department
for the termination of the right in respect of the other parts.
Article (17)
If the servient Land Unit is divided up, the right of easement shall remain in
existence over each part of it. However, if the right is not in fact used over
some of such parts, and it is not possible to use it over those parts, the owner
of each part thereof may apply to the Department, in accordance with the
provisions of this Law, for the termination of the right in respect of his part.
Article (18)
Easement rights cease to exist by the acquisition of the dominant and servient
Land Units by the same owner.
Article (19)
If a Land Unit which is encumbered by an accessory Right over Land is
divided into two or more Land Units, then each such new Land Unit will be
encumbered by the whole accessory Right over Land. The new owners may
agree with the beneficiary of the accessory Right over Land for the division of
it in such way so that each new Land Unit will be encumbered by only part of
it, to be determined by mutual consent.
Article (20)
If two Land Units merge and one of them is encumbered by an accessory
Right over Land while the other is not, then the accessory Right over Land
shall extend on the whole of the new Land Unit without the approval of the
merger by the beneficiary of the accessory Right over Land. However, if each
of the two Land Units is encumbered by an independent accessory Right over
Land, then the beneficiary of each such accessory Right over Land must
approve the merger.
Article (21)
Any alteration in the Land Unit by dividing or merging shall be registered in
the Land Register.
Chapter Ten
Ownership Documents.
Article (22)
The Department shall issue documents relating to Rights over Land on the
basis of the actual records of the Land Register.
Article (23)
Without prejudice to the provisions of any other law, apartment buildings and
multi-story buildings shall be treated as a single Land Unit and shall have one
record in the Land Register to be supplemented by records stating the names
of the owners of the apartments, stories and common parts.
Article (24)
(1) Ownership documents mentioned in Article (22) of this Law are
conclusive evidence of the Rights over Land contained therein.
(2) In the Land Unit record shall be set out any conditions, promises or
restrictions concerning Rights over Land and other obligations.
Chapter Eleven
Final Provisions
Article (25)
Provisions of the Federal Civil Transactions Law No. 5/1985 and its
amendments shall apply to all matters not provided for by this Law.
Article (26)
(1) Any agreement or transaction made contrary to the provisions of this
Law shall be null and void, as shall also be null and void any
agreement or disposal made with the intention to contravene the
provisions of this Law
(2) The nullity of such agreement or disposal may be invoked before the
Court by every Person having an interest, as well as by the
Department, or the Public Prosecution, and such nullity may also be
ordered by the Court on its own initiative.
Article (27)
The Decree dated 6 November 1977 concerning Civil and Criminal Cases in
Respect of Transactions Relating to Disposals of Lands in the Emirate of
Dubai shall be repealed.
Article (28)
The Head of the Department shall issue all the necessary regulations,
decisions, orders and instructions for the implementation of the provisions of
this Law.
Article (29)
This Law shall be published in the Official Gazette and come into force as of
the date of its publication.
Mohammed bin Rashid Al Maktoum
Ruler of Dubai
Issued in Dubai on:
13 March.2006 AD
13 Safar 1427 AH

Posted in Dubai | Tagged: , | Comments Off on Law No.7/2006 Concerning Land Registration in the Emirate Dubai

 
%d bloggers like this: