Nakheel's 'wait and see' policy on investment

WAIT AND SEE: Palm developer Nakheel will not make opportunistic purchases during the current global slowdown.

The current turmoil in global markets has seen Palm developer Nakheel adopt a 'wait and see' attitude towards investing in foreign markets, a senior executive for the developer said on Monday.

Speaking during a conference at Cityscape Dubai, Robert Lee, managing director of investment projects for Nakheel said despite international turbulence, the developer would not make any opportunistic asset purchases in international markets.

"We are not that type of developer, we tend to go into international markets through a joint venture with a local partner, but in the meantime we are waiting to see what happens."

"In terms of entering mature markets like the US and the UK, we are holding back and waiting to see what happens when the turbulence finishes. We are not a passive investor, we only enter deals which we can add value to, and unless we see that value, then we won't (enter)."

Meanwhile despite the lack of credit available due to the global financial crisis, developers like Nakheel who had their own equity could continue to forge ahead while other developers scaled back their expansion plans, Lee added.

On Sunday, Nakheel unveiled plans to build the world's tallest tower, to stand a kilometre high - dwarfing Emaar's Burj Dubai which is currently under construction in the emirate.

Mohammed Al Tawash, president of Bahrain's RealCapita, said global conditions were currently so tight banks were backing out of previously agreed lending deals.

"No banks are providing funding. We are seeing letters of intent withdrawn to a point where they are even saying we can threaten legal action and they still won't lend us the money.

"Clients are saying to us they don't want to invest in new projects, they want to keep their money in the MENA region, and concentrate on the portfolio that already exists. They want to hold back, and diversify their investments across asset classes, rather than by geography.

"It's a speculators market anymore, I don't think you will see off-plan sales as much now. People will focus on their core business and their will be less projects launched. There will be more legislation and bigger focus on due dilligence for investors," he said.

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