Property Wire on Dubai
Dubai dominates property forums for the wrong reasons:
Dubai - built on cheap credit that is now disappearing fast:
Newly formed government council in Dubai promises transparency:
The Dubai property market is hot right now, but not because it is booming. It is exercising a great deal of space in the property forums this week for all the wrong reasons. It is going downhill fast. One particularly worrying aspect is the number of developers who are now admitting publicly that they do not have the finance to continue. The banks won't lend anymore to developers or buyers.
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A second thread on the same forum gives the full text of a letter sent by London and Dubai-based property wealth manager MiNC, developer of Prodigy 1 in Jumeirah Village South to investors asking for extra payments for apartments to enable it to carry on with the project after two banks withdrew funding.
The letter states that if investors don't pay up then the project will stop. Despite rules to protect investors it would appear that if the investors don't agree to pay more for apartments they have already bought they could be regarded as cancelling their contract and the developer could be entitled to 30% of what has been paid so far.
Dubai - built on cheap credit that is now disappearing fast:
When Dubai developer Nakheel unveiled the world's tallest tower in a blaze of publicity and flashing lights at Cityscape on Monday October 6th everything looked great for the future of the emirate's property sector.
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On the face of it Dubai was the one bright place, the real estate market that was immune to the economic crisis snaking its way around the globe. But behind the scenes there were very different conversations going on.
Although not known for their transparency and with a media that tends to tow the official line rather than ask probing questions, Dubai's rulers were anxious.
Newly formed government council in Dubai promises transparency:
Key decision makers involved in the real estate, finance, banking and equity markets in Dubai are ready to recommend government intervention in these sectors when it is needed due to the global credit crisis.
posted by John B. Chilton at 11/26/2008 08:00:00 PM
2 Comments:
Rumors come here daily, that Emaar is quietly laying off "thousands" of employees - not by firing them and canceling their work visas, but by informing them that they can come to work but that there won't be any paychecks issued. That Dubai's sold 25%, no, 40% of Emirates to Abu Dhabi. That Dubai's transferred ownership of Dubai Ports World AND Emaar to Abu Dhabi. That lending has ground to a halt for projects big and small, and that downstream contractors haven't seen payments for weeks and months. This could all turn into a full-fledged route, if it's not already, but you wouldn't know that from the papers, which are working hard to keep a smiling face on things. But one can read between the lines...
From today's National http://www.thenational.ae/article/20081124/BUSINESS/150155495/0/FRONTPAGE
an article about property investors seeking redress for purchasing developments that may never actually be developed.
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