By Jason Benham
Move streamlines operations at two companies, both of which are owned by Dubai World.
Nakheel, the state-owned developer of Dubai's palm-tree shaped man-made islands, has been merged with the property wing of Dubai Multi Commodities Centre (DMCC), a newspaper said on Monday.
"DMCC's property-related operations have been integrated with Nakheel to better accomodate current market conditions and optimise resources and expertise," a DMCC spokesman told The National.
Both companies are owned by Dubai World, which is in turn controlled by the Dubai government.
Nakheel said last month it received funds from Dubai's government, some of which will be used to pay contractors as it looks to complete projects.
Dubai sold $10bn of bonds to the UAE Central Bank earlier this year to raise funds to support state-linked companies suffering from the financial crisis, and plans to issue another $10bn in bonds later this year.
The emirate's once-booming real estate sector is suffering a sharp slowdown as prices have collapsed, developers slow or cancel projects and jobs are slashed.
HSBC said in a report on Sunday prices were stabilising but values could fall further.
Slumping demand would drag residential real estate prices in Dubai down between 50 and 60 percent this year from their 2008 peaks, EFG-Hermes said last month. (Reuters)
Is there any reason why Dubai World needs 2 real estate developers? Considering the state of economic disarray, it makes sense for both Nakheel and Limitless to merge. The merging of Dubai World companies is something that should have been done months ago.
Real estate developers operating in Dubai should merge to decrease operational cost and preserve cash. This will of course mean more staff made redundant however, on the long run, companies will emerge stronger
It could be called Nakheeless. Then later it can be merged with Emaar and then Dubai would finally be Nakheeless - which is probably a good thing if reports of thier financial position are true.
Dear Readers, although DMCC and limitless are parts of Dubai World but they are totally different entities. DMCCC property is basically Jumeirah Lakes Towers which is a half decent project and hundreds of people live in the development already. I say half decent because DMCC is charging the residents annual maintenance fee to at least finance the development of the project. Dubai World property entities need to step up, as JLT still does not even have one grocery store to buy milk from!!!
"A strategic initiative of the Dubai government, The Dubai Multi Commodities Centre (DMCC) was created to establish a commodity market place in Dubai, and provide industry-specific market infrastructure and a full range of facilities for the gold & precious metals, diamonds & coloured stones, energy and other commodities industries. Rated â€˜Aâ€™ by Standard & Poorâ€™s, the worldâ€™s foremost provider of independent credit ratings DMCC is a free zone authority offering 100% business ownership, a guaranteed 50 year tax holiday and freehold property options." Including DIFC it seems nothing has ever been created NOT to be about property, which is why Dubai's credibility is reaching zero. There seems to be a relentless PR campaign to tell the world how everything is fine, yet no facts are ever shared, and this dead-of-night merger is announced on a slow news day.
Silly rabbits, You missed the point, do you actual believe that they do not understand the concept of "Economies of scale" and they need your advise!!!!!!!!! The whole idea of having several companies is to eventualy build up their "Value!!!!!" and flogged them to naive people through an IPO. Get it!!!!!!!!!!!! Great play, can I please get a job with these guys, I can really play this game. I'll work on a bonus basis alone.......
In mid 2006 the masterdevelopment Jumeirah Lake Towers was owned by Nakheel and transfered to DMCC ( DMCCA). The whole management from Nakheel for JLT ( Brian Wilson and others) was also tranfered to DMCC. So nothing changed generally. What should be the difference now ?