x Abu Dhabi, UAEFriday 28 July 2017

Nakheel threatens to switch off utilities over unpaid service fees

Residents in Discovery Gardens told to expect disruptions as developer threatens to switch off power and water.

John Robins, an owner at Discovery Gardens, has paid his fees but says other owners are witholding payment because they are unhappy with Nakheel.
John Robins, an owner at Discovery Gardens, has paid his fees but says other owners are witholding payment because they are unhappy with Nakheel.

DUBAI // Property owners who have been withholding service charges have been warned to pay up or their power and water will be switched off.

The developer Nakheel has posted letters on notice boards in Discovery Gardens telling residents to expect "disruption of services".

The warning follows months of wrangling between the company and apartment owners who have refused to pay service fees because they are unhappy with the standard of maintenance and what they describe as a lack of transparency about where the money is being spent.

"I am concerned because I have heard they cut off the water for a brief period in a couple of buildings," said Michael Aldendorff, an apartment owner from South Africa who has been withholding his service fees for more than a year and owes Dh28,000.

"This is typical of Nakheel. Instead of sitting down to meet owners and find out why they aren't paying they just put up a notice in reception."

Mr Aldendorff says nearly 30 owners in his block have not paid. "This will not make me more likely to pay," he said.

"I have repeatedly emailed Nakheel asking them to provide a proper invoice for the service charge showing where the money is going, and to allow me to look at the books, which I'm entitled to do as an owner."

A Nakheel spokesman said the notices were part of the process of updating owners about the situation of funds in its buildings.

Discovery Gardens is a 26-million square feet development split into six themed clusters and comprising 291 buildings. It is not known how many owners have not paid their fees and would be affected.

The notice posted by Nakheel warns that failure to pay building service charges on time is a "violation of law to which the unit owner is fully liable for all consequences".

John Robins, an owner from the UK who has paid his fees, said any decision to withhold payment was a protest at the poor level of maintenance rather than owners' defaulting.

"The owners just want the ability to appoint their own building management company and to negotiate the district cooling fees, but it's been made very difficult," he said.

Another apartment owner, a businessman from India who decided to pay his service charges because he did not want to get into trouble with the authorities, was unhappy with the level of service provided by Nakheel.

"I bought my one-bedroom apartment for Dh1.3 million at the height of the market and now I would be lucky to get Dh450,000 for it," he said.

"I accept no one can do anything about that. But the level of maintenance from Nakheel has been non-existent from the day I bought the apartment and that is something that should not be the case."

The Nakheel spokesman said: "Nakheel does its level best to maintain the continuity of the service and we encourage and request all the owners to pay their service charges fees on time to avoid inconvenience."

The service charge was a "collective responsibility" that served all the owners in buildings that are part of the community. "We hope that defaulters will respond to several reminders and pay the service charge."