E-mail Article
Printer Friendly
Share Article
Dubai mulls cancellation of 27 projects - RERA
Dubai is considering cancelling 27 projects, the head of its real estate regulator said on Monday, as the emirate's property market slumps in the global downturn.
A decision whether to cancel or not would be made by the end of the month, said Marwan bin Ghalita, the head of the Real Estate Regulatory Authority (RERA).
"The decision has not been done. They are projects all over Dubai - third party projects (sub developers)," he said.
Earlier this year, Ghalita said he believed 25 percent of projects will be cancelled in Dubai as a result of the global economic slowdown.
"It's almost the same," he said when asked if that figure had changed. The Dubai Land Department and RERA set up a committee last week to cancel projects in the emirate that are not feasible.
Real estate prices tumbled 41 percent in the first three months of the year, property consultants Colliers said in a recent report.
A collapse in property prices has already led to project cancellations in the region worth billions of dollars.
More than half of the construction projects in the United Arab Emirates, worth $582 billion, have been put on hold, Dubai-based market research firm Proleads said in February.
Ghalita said on Monday the committee would cancel projects based on RERA's decision whether or not they should continue, a request from developers to cancel, or through complaints to the watchdog from project investors.
In February RERA said Dubai developers are likely to delay the delivery of about 20 percent of residential units in 2009 and 40 percent in 2010. (Reuters)
Quick Links(Residental)
Filter by address:
Comments 1-10 of 10
Posted by Dr O Murphy, London, Gt Britain on 4 June 2009 at 03:18 UAE time
I can't digest how acw could collect 80% on this investments for hannover square project to date, but only saying the fencing and excavation just started. I think the great reputation and economic achievement of the UAE will be dented by this developers.
Posted by Rajesh, Dubai, UAE on 16 May 2009 at 13:55 UAE time
Does RERA seriously expect people to believe this? They can come up with all the Laws, but the fact is that the developers do not really care. I have been to one who has said, you can take 10% of what you paid and walk, or you can go to RERA and wait for 2 years..
Their project is no where near starting, the land has not been allocated, and their response has been, we will get it soon. The money has been taken more than 2 years ago, and the develope does not answer any more.. And you have a proposed law..
Asking people to calm down.. easier said.. And this comes only from real estate developers, mostly from the west who no doubt have a benefit of currency strength. There are also local players, who have spoilt the market, but at the end of the day, it is the genuine investor who has lost.
The good news is that the truth about the developers intentions is out!
Posted by Bede, London, U.K. on 15 May 2009 at 19:44 UAE time
Time for a reality check. RERA can only try to force developers to give money back if a project is cancelled AND the dveloper is solvent OR the money is in escrow account (which quite often it isn't!) The best that most investors can hope for is that the project does one day go ahead and they get their property. It probably won't be worth what they paid for it and they may have difficulty selling it, but at the moment the vast majority of investors have absolutely nothing but a rather feeble promise from a developer who probably doesn't have any money. The ones that actually their money back are the extremely lucky ones, the ones that receive a property are the lucky ones...most people fall into neither of these categories and so are the unlucky ones.
Posted by Erfan, Nairobi, Kenya on 15 May 2009 at 19:08 UAE time
I have read in an article if the majority investors complain on a project then RERA could cancel the project and we get our full refund.
I am planning to travel to UAE to check the progress for myself and if anybody who aint happy with the way things are going with ACW and skycom please join me to pressure RERA to either push for construction of our projects or cancel them.
Posted by Erfan, Nairobi, Kenya on 15 May 2009 at 18:25 UAE time
I am surprised at the way ACW holdings are taking us for a ride with our hard earned money.
I purchased 2units in THE LIGHT in may 2008 and the project was said to be starting in JUNE 2008. To date they have not been able to start the project
They blamed RERA and DUBAI LAND DEPARTMENT in November 2008 when i was in Dubai personally. They blamed RERA and DUBAI LAND DEPARTMENT for delaying in the hand over of the plot. Its now 6 Months since they claimed to start the construction and to date they havent excavated the site.
Now the blame is with the RTA and MIZIN.
RERA should cancel the project and safeguard the interest of the investors. I can purchase a completed project with the same amount i have paid so far.
RERA should act fast in cancelling ACW PROJECTS so we can invest in projects which are feasible in dubai.
Posted by Del, London, UK on 14 May 2009 at 16:00 UAE time
Last week Ian Pask sent a letter to all investors regarding its projects. Excavation works will be complete on all projects within the next 12 weeks at which point construction should start. That excludes Platinum 2 - this is delayed due to a pending resolution between the RTA and Mizin.
There have been delays across the whole of dubai as we all know, and just as things are starting to look up, its a shame that certain investors have such little patience. Calling for projects to be cancelled is incredibly selfish for the majority who have patience.
Posted by M Aqeel, Dubai, UAE on 14 May 2009 at 08:31 UAE time
RERA should support to investors and cancelled all project delayed more than 6 months from date of project launch. ACW Holding did not started Platinum 2 project since last 10 months and forcing to pay more & more. Investors confidence should be bring back for the interest of future projects in Dubai, if investors lost their hard earned money without any reason it will be very hard to bring back confidence in the market. I have full confidence that RERA will take action on all projects that have not started, not only 27 numbers
Posted by samir, London, united kindom on 14 May 2009 at 00:13 UAE time
I have purchased an apartment with ACW Holdings at their Kensington Manor project. It was purchased back in 2007 and to date I have paid almost 80%. I have read on many forums that many investors have not had any replies to their emails nor have they had satisfactory answers to their questions having made several phone calls. Construction has not yet commenced and with the current economic situation I don’t think it will. I have read an article on the Gulf News website suggesting that payments should be made to developers in line with construction progress, yet ACW Holdings say otherwise and will penalise you if you make late or non payments that are due.
We all need to get together and approach RERA and see if we can get either our properties constructed or our monies back. I will be travelling to Dubai in a few weeks time to see for myself if any construction has commenced. If anyone would like to travel with me for a few days, please contact me. I think it’s only a small price to pay as compared to the heavy financial losses we may suffer.
Posted by Waqar Ahmadi, TORONTO, CANADA on 13 May 2009 at 20:49 UAE time
I agree with most of the postings made here and would like add my experience with ACW holdings. In Jan 2009 when I visited ACW's office I was told that construction on the platinum 2 project has already started but the reality states otherwise. The project has been delayed and there has been no communication from ACW holdings to inform me of the delays and causes of the delays. The company demands their instalments to be made on time to the escrow account even though construction has not yet commenced. The escrow account payments are linked to construction yet the company feels that it has the right to demand instalments paid as per the schedule. All ACW investors should come together to raise their concerns to RERA to look into the business practices of ACW holdings and analyse the project delays in order to take necessary measurements such as cancelling the projects and getting investors money refunded back to the investors.
Posted by farid, London, england on 13 May 2009 at 03:25 UAE time
This is a big question how the Dubai investors get their hard earned money back from developers, and situation becomes very complex when ACW Holding developer did not started the project and asking to pay more money and threatening for contract cancellation without doing any progress on project. Beside when I bought in feb-2008 from ACW Holding at platinum 1 the cost of construction was very high for example cement, steel and petrol and if you look at now the petrol reduced to 50 dollar from 147/berrel, cement 50% and steel was dhs6000/ton and now only dhs1800/ton.
The situation would be different, if the developer would started the project last year and paid high cost for the constriction, but here developer even not started the project, why the investor have to pay high price as developer is solely responsible and created all this situation and break the contract.
Why the investor have to pay high cost which is not at all applicable in the current reality market. How the investor is responsible and why