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Cut price Versace
Kipp heard about the Palazzo Versace this week for the first time in, literally, years; we wonder what the development has (and hasn’t been getting up to)?
March 6, 2011 4:14 by Eva Fernandes
Young Kipp enjoyed Tom and Jerry and you’d be hard-pressed to find someone who didn’t at one point of their lives; slapstick holds a universal appeal. For what could be funnier than seeing someone (especially a big cat like Tom) slip on a banana peel or get hammered into ground by an anvil?
Though Kipp no longer watches the old cartoon, we’d be lying if we said we didn’t find it rather funny when we see the big talkers around us fall flat on their faces. And though you may righteously frown at our candour, we all know you do too. But there is one sector in which news of people and companies falling flat on their faces doesn’t make us laugh anymore. Kipp’s said this before: nowadays, the property market is more likely to inspire in us a deep sympathy, especially when we consider the boom state it was in barely three years ago.
Take, for instance, the Palazzo Versace, a development the National reported on this week.
“The world’s first refrigerated beach is to be built at a luxury hotel in Dubai so the filthy rich holidaymakers don’t burn their feet on the scalding hot sand” scathed The Daily Mail over three years ago when the Palazzo Versace hotel in Dubai was just barely a year into construction. And like everything in Dubai pre-recession, it was obviously rather brazen about its flashy ambitions; notorious for promising to be the home of that first ever air conditioned beach. The beach would include a system of heat-absorbing pipes built under the sand, these pipes would be hooked up to computers and thermostats to regulate the temperature. In addition there was to be gigantic wind blowers placed around the beach to keep sun bathers cool.
At the time of the promotion, the developers, who had started on the project in 2007, said they expected the Palazzo Versace to be ready 2009 or early 2010 (at the very latest). But four years since it started construction, The National reports that though the main structure of the building is almost finished, the hotel is roughly 12-14 months away from being ready.
The cause for the delay? Mostly the economic slowdown it would seem. Apparently 80 percent of the apartments were sold before the recession, but the investors haven’t followed through with their payments. Soheil Abedian, the managing director of Emirates Sunland Group, which is behind Palazzo Versace, said: “More than 50 percent of [the apartments sold] have not performed. [They are in the process of cancelling about 40 contracts through the Real Estate Regulatory Agency.] When these processes are completed … we are allowed to sell [them].”
The Palazzo Versace Dubai, which is the second of its kind (the first ever Palazzo Versace is in the Gold Coast), comprises 169 private apartments and 217 hotel suites all decorated with accessories and furniture from Versace’s home range. The development is said to be worth Dh2.3 billion; which is a staggering amount. We’re sure the developer probably wished they could say the same about the price the apartments are going for.
According to Abdedian, when the apartments first came on the market, prices started at Dh17.7 million; but with the average price being Dh4,500 per square foot, a two-bedroom apartment in the Palazzo Versace can now go for Dh8.5 million: almost a 50 percent slash.
Although there is no date set for the official opening of the Palazzo Versace, the website promises the development will be open mid 2011. But Kipp is already disheartened by the overwhelming billion dirham burden the developers will have on their hands to get it filled.