Nakheel offers two-week reprieve on Shoreline fees

Tuesday, 3 January 2012 8:43 AM

Palm Jumeirah is among Nakheel's most prominent developments

Tenants in Nakheel’s Shoreline apartments have won a two-week reprieve after the developer pushed back plans to charge for access to the project’s beach, pool and gym areas by two weeks.

Dubai’s largest property developer has already banned residents with outstanding service fees from using the facilities by rolling out a temporary security card system, ahead of plans to charge annual membership fees of AED5,000 to use the beach clubs.

But in a further development on Monday night, Nakheel posted notices warning residents they would be banned from entering the buildings or car parks with access cards from Jan 15.

The notice has spurred fears the company will extend its existing lock-out to the main buildings, effectively barring residents from accessing their homes if they have not paid their service fees.

Angry tenants gathered in the lobby of Shoreline buildings on Monday night said the move would deter any future residents from moving into the beachside buildings.

“Living on the Palm Jumeirah is becoming a living hell,” one told Arabian Business. “Nobody will ever trust Nakheel again, and I suppose they’d rather see us leave and start again with new residents. This latest message suggests we won’t be allowed into our homes in two weeks time.”

A second resident said: “What are they going to do next? Storm into our houses in the middle of the night and boot us out?”

Many homeowners remain in dispute with Nakheel over their outstanding service charges, some of which date back to 2008. The developer has demanded residents clear all outstanding fees in exchange for security cards to access facilities. But homeowners argue they are only obliged to pay the fees from 2010 and 2011, which were approved by Dubai’s real estate watchdog, RERA, and not the backlog of fees demanded by Nakheel.

Residents have also disputed Nakheel’s plan to turn the building’s beach clubs into private facilities, with annual fees of up to AED12,000 a year, arguing they own the common grounds.

The CEO of RERA, said last month that Nakheel had no right to deny residents access to communal facilities by turning them into clubs.

“By law, no one can stop an owner or a registered tenant from using the communal areas once they have paid service fees,” Marwan bin Ghalita told Bloomberg. “If you bought something based on an agreement with a developer, he can’t change it.”

One resident said he believed it was only a matter of time before Nakheel backed down and scrapped its plan to charge for access to the beach, pool and gym.

“We don’t have an official letter from RERA yet to say they have to open up the doors for us, so we can’t really call the police and force them to open the doors,” the resident said. “But RERA have been drafting a letter since last week, which needs a signature from the director-general of the land department. Once it is signed, we can call the police and get them to open the doors.”

Dubai developers are trying to generate income after the global credit crisis left many of them short of funding to complete projects across the emirate. Nakheel has incurred AED78.6bn dirhams in losses since the crisis began in the third quarter of 2008.

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Posted by: Grant Holt Wednesday, 4 January 2012 1:27 PM[UAE] - UAE

Just to add my two penneth to the debate over common areas, access, rights and fees etc. without reading any contracts or agreements, so before you all bite my head off!

I would assume the communual areas to be lifts, corridors, carparking, paths and gyms within the plot boundary as standard. I would deem the outside pool/beach bars to be seperate entitities, as these are a functioning f&b business, whereby access can be restricted to patrons, as per the shops.

Now what you would need to determine is whether the pool and beach is within the f&b providers agreement or within the apartment owners. If I was a resident I would get copy of the f&b providers contracts, this may help define areas and conditions. Can you only eat and drink goods purchased at the bar at these pool and beach facilities? Food for thought!

However, the beach is the big one, as I deem to be outside the building plot.

Note, sales literature is not a contract. Can someone advise exact words in agreement?

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Posted by: Red Snappa Tuesday, 3 January 2012 5:26 PM[UAE] - Ireland

In order to receive this temporary access card, do you have to pay outstanding service charges to Nakheel direct or the RERA Escrow account? If it was the RERA escrow account I would assume that it would be service fees at the rate agreed by RERA not the inflated version that residents claim Nakheel is imposing. Therefore top legal and audit management from Nakheel need to defer to RERA for up to date information.

RERA should represent the law here, but is it strong enough to overturn a rash of hard nosed, often irrational decisions, which in the case of beachclubs being outside the scope of common areas, claim to have been verified by Dubai Land Department. Does this indicate a power struggle?

If they are going to lock tenants out of top luxury Palm Jumeirah through no fault of their own who have paid rent in good faith, then goodbye Dubai loyalty and sentiment from mainly expatriates.

Whatever, the impression of life in Dubai conveyed to the rest of the world is truly appalling.

Posted by: Telcoguy Tuesday, 3 January 2012 6:52 PM[UAE] - UAE

Power Struggles? Which kind of power has RERA ever shown?
Those were just words to appease people while Nakheel moved on, just to keep things going and avoid any situation too visible during the Christmas tourist season.
This comes to show what good is a contract here in a way that people will not be able to ignore.
Let see, I may be wrong and RERA may protect the investors, but I think nakheel will get away with everything.

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Posted by: RaOne Tuesday, 3 January 2012 4:07 PM[UAE] - UAE

Why is Nakheel still managing the buildings? The Owners Assosiation should have been made and empowered to hire any facility management company.

The problem is 25AED per sq ft of service charge and plus cooling charges. and you still don't get the gym/pool/beach.

It seems many owners are not paying these charges or given to RERA escrow account.

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Posted by: Mark of Zoro Tuesday, 3 January 2012 4:06 PM[UAE] - Zoroland

Nakheel has made a name for themselves - as a Developer not to be trusted

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Posted by: Rob Tuesday, 3 January 2012 4:04 PM[UAE] - UAE

This is all good and well providing Nakheel have updated their records, which as at last week were in a complete shambles where not even the correct owners of the apartments were listed in the so-called "Name and Shame" strategy by Nakheel.

Furthermore, Nakheels enforcement of their opinion in a dispute as yet unresolved by RERA smacks of heavy-handedness which is entirely unacceptable!

So much and no more!

My landlord has paid his dues in full, as have I.

Wait and see what will happen to the stooge that attempts to illegally prevent me or my family access to our residence or parking.

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