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Tue 14 Sep 2010 03:11 PM

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ACI files for bankruptcy on property funds

Future of high-profile Michael Schumacher and Nikki Lauder Dubai projects unclear after court hearing.

ACI files for bankruptcy on property funds
MONEY WORRIES: ACI Real Estate boss Robin Lohmann told Arabian Business last year that returning investors money was not an option at the time.

ACI Real Estate has filed for bankruptcy on four of its seven property funds, according to media reports in Germany.

The company – which launched a number of celebrity branded towers in Dubai – is understood to have declared the funds bankrupt at a court in Bielefeld, Germany.

The property funds were launched in 2004, with investors believed to have paid $75m into them. The first fund six years ago was used to develop a property in Jumeirah Lake Towers, Funds two and three were used for ACI’s City of Arabia development, and funds four and five for projects in Business Bay and Victory Bay.

Funds six and seven related to investments in the sports-branded Michael Schumacher and Nikki Lauder developments.

Payments from the funds were due in March last year, but did not materialise. Shortly after, the company’s boss Robin Lohmann told Arabian Business: “Giving money back is not an option as this point in time. The money has been invested in the land, which is fully paid for, and the money has been spent in the development, which is normal - the contractor and suppliers are not working for free.”

It is not clear whether work will now progress on a string of ACI Real Estate projects in Dubai. In 2008, the company announced plans for Michael Schumacher Business Avenue, Boris Becker Business Tower and Niki Lauda Twin Towers.

Construction on all three projects stalled last year. Its website still lists 11 projects that it says are under development, with another six being undertaken by “third party developers”.

Last year Lohmann 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.

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Mr Pagels 9 years ago

Good news, that This ponzi finally came end.

doo-lali 9 years ago

this is ONE of the nails in the coffin....Dubai's reputation is at stake here... Are there any more high-profile projects/construction companies soon to be announcing their bankruptcy... if so they better do it now...

John 9 years ago

And where is Mr Lohmann, just when his faithful investors need him? No doubt he has done a driver fled the scene act to avoid UAE incarceration. These guys all talked big through their PR harpies yet now the truth has to be told nobody can be found. This is a very sad reflection on the PR bubble as much as it is on the property bubble. Too many PR firms lied for their clients, using a complacent media as their patsies.

Raj 9 years ago

This group was quite interesting in its sales techniques. Guess Boris Becker and Michael Schumacher would be quite upset as there wont be any monument on their name in Dubai! Well atleast the cat is out of the bag!

marti 9 years ago

I would be interested in how much money Mr Schumacher und Lauder got for giving their names.

OpSEC-USA 9 years ago

At least the investors know exactly where they stand. I wonder what ever happened to that huge land that ACI owns free and clear here in Dubai off of Saikh Zayed Road???

Investor in Business Bay 9 years ago

The ACI management says they are waiting for the Land Department to authorize ACI to take over from Define Properties to continue the work. Any idea how to get more information?

ZubairKalam 9 years ago

I ams urprised that ACI continues on their fraudulent practices. i have lost huge sums in their Highfields Tower project and lawyers are still pursuing the case. They had teh audcaity to tell investors another lie - that Al Rashed RE were teh real culprits. 60% funds were collected for ACI Q-Sami Tower, and all that has happened is completion of basements(?). Project complteion was scheduled in 2008, and yet they go unpunished by RERA. I would blame RERA more than any other body as they seem to play games with these developers in messing up our heard earned monies and life savings.

Vicky 9 years ago

Thanks to Dubai World/ Nakheel it managed to get 99% creditors to sign the re-structuring or many more investors would have lost there hard earned savings. if they would have filed for bankruptcy too. Now only we hope the short term projects start soon as many investors have sufferd and lost rents for almost 4 years.

Ben 9 years ago

I would like to know , in this case which bankruptcy file is opened in Germany what will happen for those people which has invested in mentioned projects in Dubai ? please aware us more about this matter. THANK YOU SO MUCH