Dubai's Nakheel plans new housing project on Palm

Dubai’s Nakheel plans new housing project on Palm

Nakheel's Palm Views will consist of two buildings on the Palm Jumeirah, with each unit priced at one million dirhams ($272,300).

May 21, 2012 8:48 by Reuters

Indebted developer Nakheel plans to build a new 192-unit residential project on one of its man-made palm-shaped islands, relying on unit sales and internal resources to fund the construction, its chairman said on Sunday.

Nakheel’s Palm Views will consist of two buildings on the Palm Jumeirah, with each unit priced at one million dirhams ($272,300).

“We will look at sales and also have our own resources,” Ali Rashid Lootah said of funding, after launching the new project.

Lootah said financing for the project was “secure” but declined to give any further details. The Dubai government-owned developer began taking orders for the units on Sunday, he said.

The developer was at the centre of Dubai’s 2009 debt crisis and wrote off $21.4 billion of its real estate assets. Nakheel, which overstretched itself with ambitious projects such as the palm islands and islands shaped like a world map, completed its $16 billion restructuring last August.

The Palm Views are Nakheel’s second new residential project in 2012. It announced construction of a 100-unit townhouse project on the Palm Jumeirah earlier this year.

The new project is a shift from Nakheel’s earlier focus on large, luxurious villas and condos. All units at the Palm Views will be studio apartments and covers an area of 500 square feet.

“Such type of a project does not exist on the Palm. There is a lot of demand for this, especially among the youth. We are confident that it will sell,” said Lootah.

Construction will begin by the end of 2012 and the project is expected to be completed in the first quarter of 2014.

Lootah also said that the company’s first-quarter earnings will be an improvement on last year’s. The results are due next week.

($1 = 3.6730 UAE dirhams)

(Reporting by Praveen Menon)