By Claire Ferris-Lay
More than 3,000 investors issue action call to UAE buyers over stalled real estate project
German investors are hoping to kickstart three celebrity-branded real estate projects in Dubai after pursuing legal action against the developer for what they claim is fraud.
The group, which claims to represent more than 3,000 buyers, wants to band together with UAE residents who invested in real estate schemes backed by Alternative Capital Invest (ACI), in a bid to press ahead with the stalled properties.
“We want to combine the interest from the local investors in Dubai with the investors here from Europe to realise the projects. We think that is the only way how we can give back the money to the investors,” group spokesperson Rainer Regnery told Arabian Business.
“There are already 400 cases here in Germany against ACI – it’s a big fraud. We have two opportunities for investors; one is to do with the lawsuit, the other side is to realise the projects.”
ACI unveiled its plans for three celebrity-branded towers at the height of Dubai’s five-year property boom in 2008, fronted by its CEO Robin Lohmann,
Michael Schumacher Business Avenue, Boris Becker Business Tower and Niki Lauda Twin Towers were to be built in the city’s Business Bay district, to include residential, retail and office space. ACI’s website describes the development as “truly fit to be named after a legend”.
All three towers stalled following the collapse of Dubai’s property market in late-2008, which saw speculators flee the market and house prices slump more than 60 percent from their peak.
ACI filed for bankruptcy on four of its seven property funds in September 2010, according to German media reports. The firm’s website still lists 11 projects that it says are under development, with another six being undertaken by “third party developers”.
The property funds were launched in 2004, with investors believed to have paid $75m into them.
In an email, the ACI investor group said it had a number of European companies interested in relaunching the stalled Dubai towers.
“Our objective is to get ownership of ACI projects in Dubai, to realise them and bring them to market together with joint venture partners,” the email said. “We believe that this is the only way to save our invested money.”
The group has the full support from Michael Schumacher, Boris Becker and Niki Lauda, Regnery said.
Boris Becker told Arabian Business in February he was unsure whether he was still involved in the project the bears his name.
“I have to think about it, because I believe the deal was three or four years old and I’m not sure whether I’m still involved,” he said. “The name is still on it, but whether I’m personally involved? I don’t think so.”
Becker is not the only star to have distanced himself from the project. Ex-Formula One racing driver Niki Lauda told Arabian Business last year that had hadn’t heard from the developer since the launch of the project in December 2007.
“Who is he? No, I only met him once, when I was there in the beginning and I haven’t heard from him since then,” he said.
Lohmann in 2009 hit back at claims that the projects were being cancelled and that investors would lose their cash, saying: “For me there is no chance I will do a hit and run. You know why? Because I haven’t even collected the money I have invested and spent here. I’m not going ahead and losing AED500m ($136.1m), it’s not the way.”
Lohmann could not be contacted for comment.
I have more than 70% 0f my payments towards Dubai Star (one of the towers handled by ACI) stuck with them for the last 4 years. Still the building is not complete and ACI are saying that they need until mid 2013 to hand over the apartment. Of course ACI does not honor any penalties of delay which are mentioned in the contract.
Dubai should have better laws to protect investors from such companies
I am one of the investors of the aci unit Niki Lauda and know atleast 5 more who have bought this ill fated project in UAE . We have gone to Rera and also to ACI's office . Not a stone moved The german team should get the buy in of Rera and start this atleast out of the three towers one gets built something will come out . Most people paid 50% all those records should come out and if the construction starts then the hope will start . thanks arabian business for honestly sharing some info rather than holding the lantern in the dark .
check the webside www.aci-anleger.de Dubai investors!! Good luck
If there is such a large people against ACI for all the funds invested. Isnt it better to approach the Dubai Properties and find out how much funds has been utilized for paying off the land. Has the land for each tower been fully paid? If yes, than as per the property size and amount % paid there should be a % distributed equally between all office owners of whatever can be achieved. Why build the towers when already the commercial market is satuarated with far too over supply into the market. Simple put we as investors are placing more money into projects which shall never achieve the price we paid for Business Bay around 1,800AED sq ft... Today value maybe 900AED sqft - I think.
Does any one know if ts there an UAE investor group who are trying to redeem part of their investment?
As one of the major Dubai investors in ACI I have so far been unsuccessful trying to get in touch with the German investors via Mr.Rainer Regnery. If anyone has a lead kindly e-mail me at: firstname.lastname@example.org
Anyone out there with investments in ACI's Victory Bay ? Does anyone know what can be done re this project ?
Rainer Regnery is right by saying â€œThere are already 400 cases here in Germany against ACI. We have two opportunities for investors; one is to do with the lawsuit, the other side is to realise the projects.â€
Transparency: Where are the locals ?
Who is the owner ( local sponsor) in Dubai for this ACI projects and company?
Why is RERA Dubai just doing nothing - who pleae is in charge and responsible for this ACI company in Dubai in 2011 ?
How many units are realy sold in all this ACI projects ?
Or was this all big PR to get more buyers in the years before ?
ABÂ´s most beloved poster boy Robin Lohmann is where ?
We have all the chance now to realize the projects. Take the chance German investors! Support the Syndicate of ACI-Investors!
I also thought that there were escrow accounts for at least some ACI projects, what has happened to those, do they have money in them? Is the release of funds from escrow purely down to RERA, or have they been frozen because of the litigation at the German end?
If there is escrow money, then that is available. I should imagine Robin Lohman is no longer here, what is the RERA status of these projects on hold/suspended or cancelled?
I feel sorry for these investors, and they are only a small part of probably 40 to 50,000 investors all over the UAE who feel defrauded. That investors get together to try to find a solution by finishing the tower is wishfull thinking. Let me tell you as an expert in the DXB real estate "crash" that even if they should get it finished to whom are they going to rent the offices out or sell? At the end it will become a burden to maintain the tower functioning.