The Death of Development, Part II
Dubai master-developer Nakheel, which aimed for the stars with iconic projects, prepares for a dramatic restructuring, reports Trends. Part II.
January 13, 2010 4:01 by Edmund Sheen
Several investors in The World are waiting and watching. Oqyana, the Kuwaiti company with 22 islands on The World, says its entire project is tied to one master plan, with the bulk still at the design stage.
“Oqyana is still in the development stage and we haven’t launched sales yet,” a company spokesman said. But a former Nakheel executive says such claims have been made for a long time and don’t make sense.
“They paid 100 percent cash down and their inaction means they are confronted with a depreciating asset value. In 2006 they had decided to set up a captive power plant and bought another island for power supply. How can they remain at the same level of development for three years?” asks the insider. Oqyana isn’t willing to elaborate.
A group of investors in a leading Dubai developer that experienced trouble with Nakheel was recently advised by management with the following words:
“Work on Palm Jebel Ali [a Nakheel project even larger is scope than Palm Jumeirah] has effectively stopped, with no indication of when it might restart.”
Investor Jean Von Gissel (who owns an island on The World) looks on the bright side, however. “I’m probably going to be the only one going ahead with construction (on The World) considering the environment,” he laughs, adding that he likes it that way.
“The cost of materials has gone down significantly, and a lot of contractors who were not looking at my project because of its relatively small size are now responding favorably,” he says.