Struggling developer saw net loss of AED521m as property prices slide
Union Properties went further into the red in the
second-quarter as the struggling Dubai developer booked non-cash provisions
against valuation of its properties.
The third-largest developer in Dubai made a net loss of AED521m
($141.8m) in the quarter. This compared with a loss of AED349.38m in the same
period a year ago.
Union Properties did not provide a second quarter earnings
figure but said in a statement that its net loss for the first six months of
the year widened to AED439m from AED299m in the year earlier period.
It did not give more details about the non-cash provisions.
Total consolidated bank debt at the end of June fell to
AED6.2bn from AED6.9bn at the end of the first half last year, the developer
said. It continued to hand over properties from its Index Tower and Limestone
In June, the company said it would repay AED2bn of debt this
year and will seek to renegotiate terms for its other loans with banks.
Union's revenues for the first half of the year jumped 44
percent to AED2.25bn, it said in the statement.
The company finalised the sale of its Ritz Carlton hotel in
Dubai for AED1.1bn in November last year and used some of the proceeds to
reduce the debt.
Dubai's property sector was hit hard by a downturn, with
billions of dollars worth of projects put on hold or cancelled, while prices
slumped as much as 60 percent.
House prices in Dubai are set to fall another 10 percent a
Reuters poll in July showed.