Happy days—Is the storm finally over for Nakheel?
With the announcement of Dh4.8 billion sukuk and the promise of a gazillion units across Dubai, things are finally looking up for Nakheel.
August 25, 2011 3:37 by p.deleon
“It has been a tough 18 months — a period in which we have managed to successfully restructure our debts and the company” were the cherished words to leave Nakheel chairman Ali Rashid Lootah’s mouth late last week, when the company announced a Dh4.8 billion sukuk to its trade creditors to be listed on Nasdaq Dubai.
The much anticipated move comes as Nakheel recently announced plans to have 7,714 units delivered by the end of 2012. The lump-sum comprises of 1,663 units in International city to be delivered by March 2012; 31 units in Jumeirah Islands to be delivered by April 2012, 594 units at the Waterfront, 177 units at Badrah and Veneto; 264 units at Jumeirah Heights; 1,795 units by August 2012 at Jumeirah Park; 2,188 units at Jumeirah Village and 1,154 units at Al Furjan to be delivered.
Though, the additional pressure the delivery of these units are bound to bring to the already over-supplied real estate market is cause for concern, Nakheel has said it has managed to lease up to 70 per cent out of the 20,000 units from its leasing portfolio: “We have a 70 per cent occupancy now compared to 40 per cent a year ago. This is a sign of recovery.”
Things are definitely looking up for Nakheel, who also says it has also reduced service charges across its various developments by over 30 per cent compared to 2010. Could we, indeed be seeing the turn of the tide for Nakheel? Only time will tell.