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Tue 20 Dec 2011 09:20 AM

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Cash-flow problems delay Dubai skyscraper

City's second tallest skyscraper, the Pentominium, was put on hold in August amid liquidity woes

Cash-flow problems delay Dubai skyscraper
The Pentominium will be Dubais second-tallest tower on completion

Liquidity woes may push Dubai’s second tallest skyscraper,
the Pentominium, past its completion date as developer Trident struggles with financing,
the project manager said.

The planned 516m tower in Dubai Marina was scheduled for
completion in 2013 but saw work suspended in August amid wider financing
concerns
.

“For the time being it’s on hold,” said Amer Khan, CEO of
project management company Precipio. “The developer has faced some cash
problems so we’re trying to sort that out, and hopefully we’ll get going as
soon as possible.

“No timeline has been given [for the restart], they’re still
trying to come to a decision regarding the current problem of the cashflow.

“It’s a mixture of a few things I would say, but it’s
[partly due] to the economic situation, and the cost of the project as well.”

The Pentominium tower has attracted a barrage of attention
since its launch in 2007. The tower was nominated for the award for 'Best Property in the
World' at the CNBC International Property Awards and dubbed one of the region’s
most advanced engineering challenges.

At 122 mini-storeys, the luxury block plans to offer 172
luxury penthouse apartments designed by Italian fashion designer Salvatore
Ferragamo, each occupying its own floor.

Its height will be superseded only by the Burj Khalifa,
making the Pentominium the second tallest development in Dubai and the UAE.

Delays to the building have not deterred real estate agents,
who continue to advertise the uncompleted penthouses on their websites for
prices of AED16m.

Building firm ACC, which was awarded the construction
contract in 2009, said it continued to work with the developer towards
continuation.

Trident did not respond to calls and emails made by Arabian
Business.

The value of construction projects scrapped or on hold in
the UAE soared to $958bn in the 12 months to October, Citigroup said this month,
signalling the Gulf state’s battered project market is still some way from
recovery.

The Gulf country, which accounts for more than half of the
stalled or cancelled projects in the MENA region, saw $20bn worth of
developments added to the list over the last year.

The Gulf nation now has $604bn worth of projects planned or
underway, a decline of 33 percent on the year-earlier period, Citigroup said.

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Peter Cooper 7 years ago

Any news on the 'TAV' tower nearby? That is over 100-storeys and nothing much has happened on site for three years? That said these are the only two super-towers in trouble in the north-end of the Dubai Marina - who would have believed it possible three years ago?

IGK 7 years ago

After all the cancellations is there any future for developers in Dubai (At least for another decade) Where are the jobs to fill the buildings already empty & what about the supply coming in.

Red Snappa 7 years ago

Is the Pentomium project subject to an escrow account?

I doubt that more finance can be raised for property projects even locally, given the current financial climate globally and the reported oversupply in the Dubai Marina. Although, with all the fur flying over the thorny subject of beach clubs on the Palm Jumeirah, Dubai Marina will probably pick up. Tumble weed allegedly blowing between deserted buildings, if Palm rents don't match D.M less beach access allowance. Plus JBR's upkeep reputation still dogs it occupancy rates and no beach club still even if you did have to pay for it.

I wonder if the Pentomium formed part of Asteco's recent analysis of 6,000 plus property units due to be handed over in the Dubai Marina up to 2013?

REALESTATECEO 7 years ago

Red Snappa.....your on the money. You are one of the very few, maybe only one, on here that posts with real knowledge. Take it from a CEO in real estate sales and development... and I bet you just might be one! A compliment well deserved. I enjoy reading your response's, they are factual and warrant merit. Having been a Chief Officer of several companies in the US and Dubai, I thought I'd reach out and notate your on the spot commentary!!

al attar investor 7 years ago

As long as there are developers like Al Attar Properties who have launched several projects back in 2004 and delivered none; the confidence in Dubai Real Estate is low.

Red Snappa 7 years ago

Well REALESTATECO you are more than generous with your praise, I was an MD in another existence, but I swear never in real estate. However, more a long term observer analyst unable to bite his tongue on the rise, folly and fall of freehold arabia and with perhaps a burning desire to instill some pragmatism as far as coming to terms with the trials and tribulations of any form or recovery. Which taking a perspective that embraces global fundamentals, economic shifts and the trend toward protection of point of origin domestic property markets around the world means that recovery in what were frontier/emerging private sector housing markets is a long way off. Government funded social housing is where the action is and that ultimately creates oversupply in private housing without the jobs. Anyway, glad to make your acquaintance. Red S

Vinod reddy 7 years ago

TAV Completed and handed over many prestigious projects in UAE with diff types of clients till now,hope this one also.....soon

jet a 7 years ago

@ Realestateceo and Red snappa

what has the world come to...a yank complimenting an irishman on how well they know 'property business'when both countries have had the largest falls in property prices in history and were triggers for the economic crisis...easy on the love in guys, you should at least try to know your subject before you spiel this line to uae residents thanks very much...