Nakheel smoothes path for U-turn on Palm beach fees

Tuesday, 3 January 2012 4:36 PM

The luxury Shoreline apartments on Dubai's Palm Jumeirah

Nakheel has paved the way for a dramatic climbdown on controversial plans to charge residents in its luxury Shoreline project up to AED5,000 ($1,360) a year for access to beaches, pools and gyms.

The state-owned developer said Tuesday it would submit to any ruling made by Dubai’s real estate watchdog over its plan to morph the facilities into exclusive beach clubs.

“This issue is under review by RERA, and we await their decision on the way forward,” Nakheel chairman Ali Rashid Lootah said in an emailed statement. “Naturally, we will respect whatever decision they make.”

Nakheel last month distributed leaflets to the Palm Jumeirah residents warning it planned to roll out fees for residents, and open up the clubs to outside members at a cost of AED12,000 a year.

In the interim, the developer has banned residents with outstanding service fees from using the beach, pools and gyms by rolling out a temporary security card system.

In a further development on Monday night, Nakheel posted notices warning residents the lock-out would be extend to Shoreline’s main buildings and car parks from Jan 15.

Nakheel on Tuesday defended its decision to use access cards and said it was a response to the high number of homeowners defaulting on service charges. Homeowners on Shoreline have AED57m outstanding in service fees, down from AED72m at the start of Dec, Nakheel said.

“Nakheel is not preventing anybody who has paid their service fees from using our private beaches, pools and gyms,” Lootah said. “[Some] 78 per cent of the fees due have been collected and those who have [paid have] every right to access our facilities. However, this majority cannot be expected to subsidise those who have not paid.”

Lootah said Nakheel would retain a list of apartments without outstanding service fees to allow potential tenants to check whether their lease would include access to the pool, beach and gym.

The statement did not directly address Nakheel’s stated plans to privatise the beach clubs, which it is understood would require all Shoreline residents to pay for access.

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.

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.”

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Posted by: Michael Aldendorff Thursday, 5 January 2012 9:05 AM[UAE] - Dubai

Nakheel will ensure that the real estate market in Dubai never recovers. I am a Discovery Gardens apartment owner and they are trying the same nonsense with us charging for use of the pools although Discovery Gardens has not got as much press as The Palm...

I have never come accross a more disfunctional and unprofessional company such as Nakheel because ever since the launch of Discovery Gardens project they have been an joke.

My advice to anyone contenplating buying property in Dubai should not do it. It is the worst decision you can make.

Posted by: Mike Monday, 9 January 2012 12:39 PM[UAE] - UAE

Not true, Nakheel is the problem not Dubai Property. Emaar has been exceptional. Buy after doing your research and you will be fine, stick with reputed developers and research.

Dubai can offer you excellent return, way more than markets in Canada USA etc.

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Posted by: Salim Shaikh Wednesday, 4 January 2012 8:18 PM[UAE] - India

Why not charge them for the fresh sea air also and the soothing sound of the waves from the ocean coming onto the shore every few seconds....!!!

Posted by: Peter Peter Sunday, 8 January 2012 7:27 PM[UAE] - UAE

It is time RERA takes its mandate seriously and enforce the guidelines that they have put up on their website for the rights and duties of tenants and landlords.

We have a landlord who has violated so many rules and regulations they would need pages to enumerate. But currently there does not exist any single forum or authority which a tenant can approach for justice except the courts. And that has now become a long , tedious and expensive process.

We, the tenants of a warehouse complex in Al Quoz have over the last four years approached several departments whose rules have been ignored or broken by our landlord but have failed to see any decisive action being taken .

Can RERA now fulfill the role it was created for ?

Posted by: Syd Sunday, 8 January 2012 12:43 PM[UAE] - India

lol lol

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Posted by: Chef Wednesday, 4 January 2012 1:32 PM[UAE] - UAE

The statement Below from Paying Owner at Shoreline apts says it almost all.
I do not live there but i live also in a appartment and we can say if you pay your fees you can and should expect a well maintained building. But do not forget the horse is infront of the wagon to pull the cart and not behind meaning you cen not expect anything if you not paying your service charge.
The value of the appartment and the buidling is directly related to the upkeep and services redered to the building. if this is rent or buy its the same.
Last but not least hope that there will be justice as we still not know this untill the verdict.
It would not only be great for the people who rent or own but it could be a return in confedence in the real estate market

Posted by: Sensible owner Friday, 13 January 2012 11:06 AM[UAE] - Uk

I also pay my service fees and was alarmed to just receive another bill from nakheel for club house fees. In general i agree that service fees must be paid otherwise access must not be granted. However on inspection last week I discovered broken taps tiles and the steam room still doesn't work. We are advised that this action has had an impact on collections then why not start maintaining the clubhouse then nakheel ? The owner below makes no sense. Why not have as many guests as you want for free and then we can be faced with bus loads of people entering the beach even using the gym and facilities. Make sense "paying tenant". Any gym club or beach has a yearly subscription. In addition you have to be present and pay for guests. My subscription at hayya elapsed on December 31st. I don't complain if I can't gain access as I have not paid and when I have family here I pay for their access. Pay your fees + nakheel starts servicing+audited fees=everyone is happy.

Posted by: Paying Tenant at Shoreline Apts Wednesday, 4 January 2012 5:52 PM[UAE] - Dubai

Just to reiterate my comments from below, I agree that service charges should be paid and then maintenance should be provided. What I most disagree with, however, is that as a tenant I begrudge having to pay or make my guests pay for enjoying the common areas. We are very good friends with a family of five, but on the current charges it would cost them in the region of 500AED to visit us and go to the beach area. This is far too much to expect when we are already paying a rental premium. RERA has already stated that the gym and pool areas are common property. Nakheel are still charging guests of fully paid up tenants/owners to access the beach/pool/gym. It is like the owner of a villa saying to his tenant, you can have access to the garden and pool for free, as it is in your tenancy agreement, but your agreement does not include any friends or family - I am privatising the garden and pool and whilst you still have access for free any guests will have to pay for access.

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Posted by: ssdubai Wednesday, 4 January 2012 9:11 AM[UAE] - UAE

Nakheel are planning to block access to apartments and parking for owners and tenantas for the shoreline from the 15th Jan. They are installing new access cards.
(They never bothered fixing the broken access cards and parking for the last 3 years until now).
Anyone who has outstanding payments will not be issued a card and hence blocked from accessing their apartments.

They are demanding payment for the beach clubs as part of the service charges despite a notice from RERA that owners only need to pay service charges at this point of time.

I wish Dubai sorts its out laws quickly as all these things are happening because there are no set laws around home owners, common property etc. It allows managenent companies to get away with denying people access to their own properties

This cannot happen anywhere else in the world you could call the police - as esentially the management company are employees of the owners and not their bosses.

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Posted by: KDE Wednesday, 4 January 2012 9:08 AM[UAE] - UK

I have lived many places in the World and been confronted with many cultures, but i have never ever experienced such arrogance as the one I found in Dubai. Emmar did the exact same thing to all us homeowners in Old Town, we purchased the properties with the club etc included, but later they privaticed them, nothing we could do about, they also hiked the service fees 100% again nothing we could do, on top of that Emmar never managed to solve the cold tap water problem, or lack of the same, there is no cold water in the taps, because they use that water in the cooling system before it reach the houses.

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