Al Habtoor Leighton Group, a joint venture between Dubai’s Al Habtoor Group and the Australian firm Leighton Holdings, is owed more than AED4bn ($1.08bn) for finished projects, the chairman of Al Habtoor Group has told Arabian Business.
Khalaf Al Habtoor, who sold a 45 percent stake in his contracting business to Leighton Holdings for $845m in 2007, said the company is still chasing payment for projects completed some 18 months ago.
“[We have been waiting] for more than a year and a half. This is not just money that’s owed from UAE companies, it’s the whole of the GCC, for Habtoor Leighton,” said the chairman of Al Habtoor Group, a UAE-family owned conglomerate.
“I don’t think they have any [bad] intensions but maybe because of the financial crisis they are struggling. It’s not only us at Habtoor Leighton, I think any contractor if you call them they will say the same.”
The firm, which has built Dubai landmarks such as the Burj Al Arab and Jumeirah Beach Hotel, has an UAE order book of around $4bn.
Despite the late payments Al Habtoor said the firm would not have to restructure any debts. “No we are not restructuring,” he said. “We are well equipped, we don’t need anything. The only thing we are doing is pushing everybody to collect [payments owed].”
Property prices across Dubai have fallen by nearly 60 percent from their 2008 peak in the wake of the global downturn. Many contractors have complained of late payments as construction projects across the emirate have been put on hold or cancelled.
In September, Dubai said almost half of the city’s planned real estate projects had been cancelled amid paralysed credit markets.
Abu Dhabi contractor Al Jaber Group said in June it was restructuring debts of up to $1.6bn after struggling to secure payment from clients.
“The payment issue with the Dubai downturn is still tough…..We’re still having some issues with payments as are all the major contractors are,” Fatima Al Jaber, COO of Al Jaber, told Arabian Business in December.