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Abu Dhabi developer offers to renegotiate prices

A property developer in Abu Dhabi has taken the unprecedented step of asking its customers if they want to renegotiate the price of their off-plan projects in the wake of falling construction costs, it was reported on Monday.

Bloom Properties said it was going back to existing customers at its Bloom Gardens development who have made down payments with revised prices and payment plans, according to UAE daily The National.
Property prices in the capital have soared in the past few years with buyers paying as much as AED3,000 ($816) per sqft at the height of the boom last years, leaving a dearth of new investors.

Bloom's actions are seen as a “good move’ by other property brokers who say it is one of the only ways to keep existing investors, 80 percent of whom are speculators, involved in projects.

“We are going back to the existing buyers in Bloom Gardens in Abu Dhabi with the revised prices and payment plans,” Hani Shammah, the chief executive of Bloom properties said.

“This is not taboo for us. We have revisited the prices in line with the construction costs. We are passing on the declining construction costs to the end-user,” Shammah added.

Vincent Easton, the sales director of the property brokerage Sherwoods applauded the move.

“There is only a few mechanisms you can use for that. One is financing which is very difficult at the moment. One is revised payment terms. It is a good move. It shows the intention of the developer to continue to build and should inject confidence,” he said.

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