Investors in talks to rescue 3 Dubai Sports City projects

Irish buyers to meet with property firm on Tuesday over stalled projects in Dubai.
STALLED PROJECTS: Profile Residence, one of a number of stalled projects in Dubai into which 1,000 Irish investors put their money.
By Shane McGinley
Tue 08 Jun 2010 06:16 AM

An Indian company will meet with a group of Irish investors in Dublin on Tuesday in a bid to strike a deal to rescue a number of projects in the Dubai Sports City development, Arabian Business has learnt.

Up to 1,000 Irish investors bought properties in Dubai Sports City through the Dublin-based Larionovo overseas property agency, which ran into financial difficulties and went into liquidation in early 2009.

Around 130 investors, who had each invested a minimum of 75,000 Euro ($89,797.99), set up the Dubai Action Group and attempted to recoup their money from Profile Group, the Dubai-based parent company of Larionovo.

Last week, Probir Chatterjee, the former financial controller of Profile Group, and a number of other Indian businessmen, set up the Innovation Group and took over the Profile Group’s Dubai Sports City projects, which include Eagle Heights, Bermuda Views and Profile Residence.

“The original developer… sold or gave his shareholding to this new Indian company because he either cannot or does not want to build out these units,” Tony Hynes, chairman of the Dubai Action Group, told Arabian Business.

Earlier this week, Chatterjee met with British investors in the developments and he has arranged to meet Irish investors in Dublin on Tuesday and Wednesday, in a bid to persuade them to invest the remainder of the money due in order to complete construction of the units.

“A lot of [Irish investors] have paid 65 percent upfront and I imagine [Chatterjee] needs the 35 percent to finance the building out. So I imagine that is what he is doing here, getting a feeler for who is going to close and who isn’t,” Hynes said.

He added that Chatterjee is aiming to get the finance in place to start construction on the units this month and plans to have them completed within eighteen months.

It is estimated that since 2002 up to 5,000 Irish investors pumped money into developments across Dubai, some of which have now run into difficulty since the onset of the global property downturn in 2008.

‘The simple fact is that too many apartments were being built. It was unsustainable. Investors who got in very early did well if they sold. But most didn’t," said Ronan O’Driscoll, director at the Savills agency in Dublin told the Sunday Business Post newspaper in November last year.

In March 2009, John O’Dolan, one of Ireland's leading building developers and owner of the island of Ireland on The World manmade project off the coast of Dubai took his own life amid rumours of financial worries as a result of the global economic crisis.

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