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Harder and harder to see
Something needs to be done about the lack of transparency in distressed property developments in the UAE.
March 8, 2011 4:05 by Eva Fernandes
Just to give you some background on the company so you can understand the magnitude (and by extension the investor’s investments): the White Bay project, a $3 billion development in Umm al-Quwain that was set to boast 8,000 homes and to span a waterfront strip and two man-made islands; its infrastructure was reportedly in place, but main construction was yet to begin. The failure seems to have been down to a combination of lack of payments from some investors, and problems with government planning. Al-Murjan Real Estate LLC, which was founded between Sheikh Abdullah bin Rashid Al Mualla and Al Khalijia Investments LLC, had a lawsuit filed against it by Sheikh Abdullah who asked the company to dissolve and appoint court liquidators to complete the liquidation process.
And then this week, after five months, news emerged that the liquidators of Al Murjan Real Estate have called a creditors meeting on April 3. Emirates 24|7 interviewed a representative from legal firm HPL Yamalova & Plewka JLT, which is representing two investors in the insolvency proceedings, who told the website: “One of our investor got a call from the liquidator’s office.”
And that is all very well for the firm’s client, but Kipp does feel for another investor, who bought two apartments in the development and hasn’t heard anything from the project since January: “They told us they would send an invitation in February, but we haven’t heard anything” complained the investor.
This contact-some-investors-but-not-all approach is a symptom of the disarray that property disputes here so often seem to end up in. We’re sure they’ll straighten things out at White Bay (well, we certainly hope they will), but it reminds us that proper, clear legislation about the course of action a developer in trouble should follow is still badly needed, and transparency needs to be seen as a valuable tool, and not a hindrance.
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