Dubai's Nakheel was planning a luxury hotel on its man-made ‘The World’ development alongside South African hotel operator Kerzner International, but scrapped the project due to the 2008 property crisis, Arabian Business has learned.
Launched in 2007, the hotel project was to be built on Coral Island, a luxury resort covering 73 hectares in the North American region of ‘The World’.
Located across 20 connected islands and with 9.5km of beachfront, the central area was to include a 150-room hotel and spa and marina and 300 beach villas, townhouses and water-homes.
As part of a trial hearing before Dubai World Tribunal on Tuesday, a witness revealed the resort was to be a joint venture between ‘The World’, a subsidiary of Nakheel and Kerzner International, the operator of the Atlantis The Palm Hotel on Palm Jumeirah.
A Kerzner International spokesperson confirmed the plans but revealed the project had now been terminated.
“We were developing a project on Coral Island with Nakheel which was going to be a One&Only. The project was referred to as One&Only Coral Island, The World, when it was in the development stages. It was terminated when Dubai entered the financial crisis. It was not an Atlantis project,” the spokesperson confirmed.
Last month, Kerzner sold its 50 percent stake in Atlantis, The Palm to resort co-owner Istithmar World, a unit of Dubai World, for US$250m.
The deal was announced as part of the company's comprehensive restructuring to improve its capital structure and "position it for sustainable, long-term growth as a global management company", a statement said.
Kerzner has also handed ownership of Bahamas-based Atlantis Paradise Island, and the adjacent Bahamas One&Only Ocean Club to creditor Brookfield Asset Management. Brookfield will write off about US$175m of debt as part of the deal, the statement added.
Following the sale, which makes Istithmar the sole owner of the hotel, Kerzner said it will continue to manage 1,500-room Atlantis, The Palm as part of a multi-year agreement.