Deyaar Development, the second largest property developer in Dubai, announced massive losses for 2010 in what it called "an extremely challenging period for the real estate sector in the UAE and wider region".
Deyaar looks on bright side after Dh2.3bn loss
Deyaar Development, the second-largest public property company in Dubai, yesterday announced a Dh2.3 billion (US$626.2 million) loss last year after dramatically writing down the value of its assets.
The company called the year an "extremely challenging period for the real estate sector in the UAE and wider region".
Deyaar had revenues of Dh2.6bn for the year from handing over four projects to buyers, but the combined operating expenses and Dh2.22bn of provisions, revaluations and impairments pushed it deeply into the red, according to an income statement.
Three of the company's top executives, including Markus Giebel, the chief executive, left the company last April.
Saeed al Qatami, the acting chief executive, said yesterday the developer would focus on growing its property and facility management business that oversees 14,000 units.
In January, Deyaar increased its stake in Omega Engineering, based in Dubai, to fully own the company.
"As we enter a period of increased stability in the UAE property sector, in line with more positive macroeconomic conditions, Deyaar now looks to 2011 with renewed confidence, as well as with an enduring focus on customer care and service innovation," Mr al Qatami said.
By "conservatively" writing down the value of its projects and investments, Deyaar said it was entering 2011 "with a healthier balance sheet and greater ability to respond to evolving market conditions".
Property developers have been hard hit across the world, but in the Gulf region the Dubai market has suffered the steepest decline in prices since their peak in 2008.
Deyaar is 41 per cent owned by Dubai Islamic Bank, which is in turn 29.8 per cent owned by the Dubai Government.