By Elizabeth Broomhall
Developer says still in talks with investors in stalled Dubai Palm Springs project
Damac Properties, the real estate developer behind Dubai’s Ocean Heights and the Waves, has sold more than a third of units in its Versace-branded tower in Beirut, its CEO said Monday.
The Dubai-based firm has secured investors for almost 40 percent of Damac Tower’s apartments, after signing a deal with Italian fashion house Versace to oversee the interiors in June last year.
“In Lebanon, we mobilised the site in 2010, we launched in June 2010, and so far, although being a very premium project in an area which is still under a lot of political turmoil, our sales are very good,” said Ziad El Chaar.
“Versace don’t get involved in the exterior look of the building, they just want to make sure the exterior is premium enough to carry the brand. They get involved in the design of all the common areas, and then they add a touch of Versace to all the individual apartments.”
The 28-storey tower is currently under construction in downtown Beirut, and will be completed in the last quarter of 2013. Apartments start from $700,000.
The project is one of three Damac developments with designs by Versace Home, but the first to be completely fitted-out by the Italian fashion house.
Privately-held Damac was among Dubai’s most prominent real estate developers during the Gulf emirate’s property boom from 2006-2008. The collapse of city’s real estate market after the onset of the global financial crisis forced the company to delay a number of projects.
Damac in August offered investors in its stalled Palm Springs project a partial refund, after work on the Nakheel-owned master plot, Palm Jebel Ali, was suspended.
Investors told Arabian Business they had been offered a 70 percent refund of their deposit upfront, or 25 percent immediately followed by a further 25 percent annually for the next three years.
Palm Springs was designed to be a 25-storey beachfront development located on Palm Jebel Ali. The offshore island stalled in the wake of the emirate’s real estate crash and is now designated by Nakheel as a “long-term project”.
Damac said in September it had no plans to launch any further projects in the UAE and would instead focus on handovers, and developments in markets such as Saudi Arabia and Qatar.
The company has delivered 21 buildings comprising 4,072 in the year-to-date, El Chaar said.
“In some of the projects we have some delays but most of the delays are under control,” he said.
“In our purchase agreements with our customers there are terms for project delays and if delayed what compensation [will be paid]. This is standard procedure in off-plan development.”
Asked about the Palm Springs investors, El Chaar said the firm had seen a “positive response” to its refund offer but declined to specify how many investors had accepted the offer.
“We have offered them a full refund in staged payments [or] a lump sum [70 percent] payment immediate which is unprecedented in the market,” said El Chaar. “We are talking to our clients on a case-by-case basis, and we are working very hard to bring [the issue] to a close.
“There are a few [investors] which we are continuing talks with.”
Palm Springs investors have rejected the offer Damac put forward in September so Damac is not telling the truth.
Damac lack any sense of a customer focus and are not to be trusted. I am a Palm Springs investor and Damac have held 25% deposit from every investor for over 8 years.To try and close this fiasco they are prepared to pay 70% lump sum, i.e the investor looses 30%, or they wish to pay 100% over 4 years, i.e they hold on to our money even longer gaining further interest without any compensation.
The few investors that is referred to in the article I would suggest represent approximatley 20 - 30% of the appartment stock within Palm Spings. Currently Damac have shown little interest in settling in a manner which would be appropriate.
I am one of the Palm Spring investors that Demac treated dismally with disdain,I am struggling to get any redress from Damac after 8 years waiting. I am left without my money/compensation and no real amicable results.
Hi all, I have been one of Damac's investors/customers for the last 8 years having purchased an apartment on Palm Springs.
After such a long time, I think Damac have lost sight of the contract I signed with them. I pay them money, they build me an apartment. At the moment it's all one way. They have my money and I have nothing.
If your thinking of investing wth Damac I would think again, if your currently investing with them I would seriously think about how you could exit the arrangement with all your money intact.
You have been warned.
To be honest, poor deal that it may sound, let us also take into account the 1,000's of other buyers outside the DAMAC with no chance of a property, who have never even had a sniff of a refund offer or any other form of communication. At least it's a deal.
I really do feel that government agencies need to step into this chaos and create some policy components to sort the whole mess out. Who in their right mind is going to buy amidst an atmosphere of zero trust created by the a lack of punitive action in favour of the victim.
If the 65 buyers at Tameer Towers in Abu Dhabi get that preceedent ruling for a refund for late delivery, then that will open the gate as they're a Dubai-based developer.
All the below comments concerning Palm Springs are true. I also invested 8 yrs ago and have nothing. Damac have my money for 8 years and now legal action is progressing for 48 investors Damac are running scared and making hasty last minute silly offers which are being rejected
No doubt this will end in Court, we will not give in.