The developer behind much-delayed Dubai Lagoon project has said the local real estate market "badly needed" a correction in prices.
Tahir Schön, chairman of Schon Properties said he was "unworried" about the downturn in the sector.
He said: “The market was overheated and badly needed a correction. We have been in business for decades and fully understand that all markets are cyclical.
"Those developers and investors who forgot this fact of life, who thought that the property boom would never end and were seduced by quick and easy profits, those who leveraged themselves beyond their means, are suffering now, but this doesn’t mean Dubai isn’t still a fantastic place to invest and do business."
Schon Properties came under fire last year from disgruntled investors after long delays to the $598 million plan.
Residential units which were initially scheduled for completion by December 2007 are now expected to be delivered in 2011.
Schon predicted that the days of flipping homes were over and both developers and investors were having a "reality check".
He added: "I have complete confidence in the prospects for sensible long-term real estate investment in Dubai. I am not worried.”
Schon also announced that construction on the 750 million dirham Schön Business Park project was on schedule for completion in the first quarter of 2010.
He claimed 90 percent of the business park space was sold out.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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