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The final nail in the coffin
Is a company bankruptcy 3,000 miles away in Germany the final nail in the coffin for Dubai’s brash vanity developments? Kipp is praying it is.
January 16, 2011 2:41 by Samuel Potter
Well what do you know: It turns out that simply taking a famous person’s name and attaching it to a building is not a guaranteed way to make millions. Kipp’s uncle Mervyn, who recently renamed his villa “David Hasselhoff Bay”, will be most disappointed.
How can we say this for sure? Because news has broken that the largest German fund for property investors in Dubai has declared bankruptcy on four of its seven funds.
Alternative Capital Invest (ACI), based in Gütersloh, Germany, said that “due to the balance of the funds the declaration of bankruptcy is evident and legally required,” reports Gulf News.
Apparently German magazine Focus quoted ACI’s founder (who has resigned as CEO) as saying that the insolvency has come about thanks to “inevitable depreciation of the projects’ asset value”. Losses are thought to be in the region of 70 million euros.
Bet you’re wondering what all this has to do with uncle Merv and his Hasselhoff-monikered two bed. Well ACI was the company intent on “tower branding.” It was behind developments named after celebrities including Formula One legends Michael Schumacher and Niki Lauda and tennis champion Boris Becker. Yep, you remember now. As the paper observes, massive ad campaigns were running for the developments pre-crisis. Those particular projects were known as Michael Schumacher Business Avenue, Boris Becker Business Tower and Niki Lauda Twin Tower. Now, while they aren’t totally sunk, they are among a number of ACI projects stalled with unknown prospects of completion.
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