By Alex Delmar-Morgan
Investors claim payments are still date-based not construction.
A group of investors locked in a dispute with developer ACW Holdings have urged its members to withhold further payments until installments are linked to construction.
Investors, many of whom have paid 80 percent of installments on properties, claim payment plans are still date-based.
ACW’s projects are experiencing severe delays, with only excavation and piling works underway.
Last month, Arabian Business reported that ACW investors had formed an action group, consisting of around 70 members.
Writing in the latest newsletter to ACW investors, Simon Brew, chairman of the group, said: “We repeat our advice not to pay any more stage payments on any ACW developments until you receive a RERA-approved payment plan which refers to real building milestones and not just to calendar dates. We have not yet seen any ACW payment plan which meets this criterion.”
However, the developer said on Tuesday that Dubai property watchdog RERA (the Real Estate Regulatory Authority) last week approved its construction linked payment schedules. They will be released in September.
Scott Richards, director of client services at ACW told Arabian Business: “A construction based payment schedule is what most investors want.”
“There is a lot of disaster in the market and that is something we pay attention to -you really do have to make an effort for investors,” he added.
Investors also say they are unfairly being charged pre-registration fees and claim these are not due until completion and handover of the buildings.
ACW strongly denied this and said it was entitled to charge the fee because it was a legal requirement- involving the registration of off plan property on behalf of investors with the Dubai Land Department (DLD).
Registration of both the property and the sale contract costs AED1960 and AED1000, ACW said.
Richards insisted the company was ‘not making a profit’ by charging investors the fees.
Only excavation work and no actual construction has started on five of ACW’s projects in the Arjan and Jumeirah Village districts in Dubai.
A sixth project called Platinum Two is severely delayed due to a proposed road through the site by the Roads and Transport Authority (RTA).
ACW was established in 2004 and has two UK offices in London and Leeds as well as its Dubai operations in Emaar Business Park and Jebel Ali.
The company has launched seven freehold developments since 2006 with an asset value of AED5bn.
These are the same flippers who signed the contract when bought, hoping that they can flip the property for huge profits, since the tide changed, you want RERA to interfere. Come on guys, did check with RERA before signing the contract? Treat your greediness first and then seek the help?
In all these cases, what the market requires is a strong and fair government regulator/watchdog. In my opinion, RERA is not strong enough and is not fair. RERA is acting selectively and in many cases has ignored the facts and has not used its power to question master developers and developers. There are many projects which have not started due to problems they have with RTA, Land Dept or other government entities. These are not the investors' faults. Actually, investors are the real victims. RERA should step in and cancel all the projects which up to now have not started yet and - as we were told that the investors' money are protected and are kept in escrow accounts - release these payments and give the money back to investors. This will create transparency and will reduce tension and injustice. While making further payments based on construction milestones may look like a good solution, this can only be applied to projects which have already started and the construction is under way.
What a mess developed in Dubai due to the real estate boom. This mess is affecting everything...what a mess
I have invested in Hanover Square and would like to know how I can join the ACW Investors action group! Can anyone help or point me in the right direction?
We have invested in kinsington Manor and Hanover Square. Paid on would like to know how I can join the ACW Investors action group! to give our support Can anyone please help us to join thanks.
I have just sent and email regarding completion dates for Hanover Square and options if the property is not completed, under the terms of the contract we are entitle to have our money back if the property is not completed by the 31st May 2010. I will let you know their reply
Will i be able to get my money back? if Hanover square will not be completed by May 2010. I have paid 80% already. please reply.
I would like to know if the Hanover Square not complete by end of the 31 May 2010, can I request to refund my investment.
Under contract terms we are entitled to have our money refunded if the property is not completed within a year of the May 2009 deadline.
Please reply if we can get our money back, because it is taking long time to built, and is it true that we can get our money back if it is not completed by may 2010, I check the update today on Acw Holdings website and hardly anything has been built.why dont they just cancel the project and give the investors there money back.