Opening the gates: a UAE property round up
Nakheel wins advance payments case; Tamweel seeks new funding; Musanada announces new Emirati housing project
April 19, 2011 4:15 by Eva Fernandes
Kipp’s been watching the property news pile up on their inbox. It seems the sector is picking up some pace if not continually gaining momentum.
There are a number of the big names in the property market that have abuzz with activity. And so here is your Kipp property round-up:
It’s a major victory for Nakheel this week as the Dubai World Tribunal has ruled that Nakheel should be able to cash up to Dh192 million (US$52.2m) of advance payment guarantees posted by Al Shafar General Contracting and Nurol—a pair of contractors. As the National explains in this article, an advance payment is the amount a developer pays a contractor to help them get started on their construction projects. In these particular cases, Nakheel had already paid an advance before the projects were cancelled on account of the economic crisis. The win is a crucial victory for Nakheel, which has securing money through every available avenue, including the auctioning of its company vehicles.
This news comes alongside reports that Tamweel, the Islamic home finance company, is considering a return to the securitisation market. Varun Sood, the acting chief executive of Tamweel, told The National that Tamweel was concerned with getting “long-term funding” to stay clear of the problems it had experienced at the beginning of the financial crisis.
A standard securitisation includes “a pool of debts, such as mortgages or credit card debt, which are combined and sold on to investors in the form of bonds or other instruments. The interest and principal payments on the debts underlying the bonds are then paid out to investors on a regular basis.”
Over in the capital, Abu Dhabi General Services (Musanada) announced during CityScape, their plans to develop a AED 7.1 billion ($1.93 billion) housing project located on the outskirts of Abu Dhabi which will be targeted towards Emirati nationals.
The project, which will have over 12,000 new units, will be funded by the government and will cover about 40 square kilometres and be able to house some 200,000 residents. Ziad Ammous, Operations & Projects Control Director told Reuters “It will be a mini urban city with retail, leisure and other facilities for the residents. It will be mostly villas.”