“The Trust Account Department is currently working on dividing the project to seven phases; each phase will have its standalone trust account, finance and budget,” said Essa Al Mansoori, the director of the Land Department’s Real Estate Trust Account Development Department.
Delayed Dh3 billion Dubai Lagoon project to be tackled in phases, say Dubai authorities
DUBAI // The much-delayed Dh3 billion Dubai Lagoon project is to be broken up into seven phases that will be closely monitored until final delivery.
The project, a residential community planned around a lake, was due to be finished six years ago but handover deadlines were not met.
“The trust account department is working on dividing the project into seven phases,” said Essa Al Mansoori, director of the Land Department’s real estate trust account development division. “Each phase will have its standalone trust account, finance and budget.
“Upon completion of dividing the project into phases this month and finalising the trust accounts for each stage, we will visit the project and raise a technical report showing the progress of each phase and the time required for construction and delivery.”
Mr Al Mansoori said legal action would be taken if the stipulations were not met, but he did not give a timeframe.
“The Real Estate Regulatory Agency will be taking the necessary legal action and it will assign another investor to complete the project through the Tanmia initiative – one of the Real Estate Investment Management and Promotion Centre’s initiatives – or cancel and send the project to the liquidation committee at Dubai courts,” he said.
But the assurances have not allayed investors’ fears. Residents and overseas investors say their confidence has been shattered by missed deadlines and unkept promises.
“We don’t really trust anybody,” said Najam Iqbal, an American engineer who paid Dh423,000 for an apartment.
Mr Iqbal works in Jebel Ali but was forced to move to Ajman from Dubai four years ago when rents started to climb.
“I thought I would live in my own home and even come home for lunch,” he said. “Instead I had to move out of Dubai.
“I worked hard for this money, it was my life savings. I’ve waited nine years. We have been given dates so many times that we have no confidence left.”
Launched in 2005, the project attracted more than 2,000 investors aspiring to live in a community of eight-storey buildings clustered around a lake, swimming pools, mosque, shopping centre and a school in the Dubai Investment Park area.
Delays to the project, scheduled for completion in 2008, were blamed on the economic downturn, utility clearances and road-widening plans.
The developer, Schon Properties, assured a building-by-building handover from April last year but that deadline was not met. Schon did not respond to requests for comment.
In the sandy construction site, the outer shells of two of the eight buildings have been painted and electrical and plumbing work is under way in one of them.
A group of investors, including Mr Iqbal, last month submitted forms to Schon to place their units on sale.
“Some of us signed an expression of interest form so if another developer takes over or they find a buyer and we agree on a price, they can take over our units,” he said.
“We have no idea whether offers will be at market value or lower. Honestly, I’ll take 10-20 per cent less, but I want to get out.”
Other investors still hope the development will be completed. The project had attracted investors from Britain and Europe.
British citizen David has visited the property 16 times over the past nine years hoping for some progress.
“I’m not encouraged because at the rate they are going it would take 20 years,” he said after a visit in May.
He has paid more than Dh530,000 – 85 per cent of the total cost – for a one-bedroom flat.
“I didn’t buy to make money but to enjoy Dubai,” David said.
“If this is finished I would be very, very happy. I would rather not get my money back, I would rather it gets it completed. But now I feel if it doesn’t get done this year, it will not get done at all.”