Feb 03 2012 |
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Union Properties net loss widens
Friday, Feb 03, 2012
Gulf News
Dubai Real estate developer Union Properties posted a full year net loss of Dh1.57 billion in 2011, up from the Dh1.53 billion loss it reported a year earlier.
“Total assets reduced to Dh9.1 billion while shareholders’ equity decreased to Dh2.4 billion.
The company made an operating profit of Dh196 million and net loss after provision for loss on valuation of properties of Dh1.6 billion,” Union Properties said in a statement posted on the Dubai Financial Market website.
Incomplete projects
Union Properties recently announced that it had secured a loan of Dh400 million from Emirates NBD to complete two stalled hotel projects in its MotorCity development.
“We will start repaying in two years. The loan will help us complete the two hotels and also spend as we need to,” Khalid Bin Kalban, chairman of Union Properties , told Bloomberg.
The developer will soon tender a contract to finish the Renaissance Hotel and the Courtyard by Marriott in MotorCity.
Dubai MotorCity was among the many projects stalled during the property slump which saw prices drop more than 65 per cent in 2009. The development, which is 70 per cent complete, comprises Uptown MotorCity, Green Community MotorCity, Dubai Autodrome and Business Park MotorCity.
Union Properties finalised the sale of the Ritz-Carlton Hotel at Dubai International Financial Centre in November 2010. The developer recently completed a commercial building — Index Tower — at a time when commercial rents are expected to decrease due to upcoming supply.
Commercial rents
According to JLL’s Q4 [fourth quarter] 2011 Market Overview, average asking rents for prime office buildings have remained stable over the past year. However, with a vacancy rate that now stands at around 30 per cent, office rentals are likely to face downward pressure as further supply enters the market in a period where many tenants are optimising or rationalising their space requirements.
results
comparison
Dh1.57b
the developer’s full year net loss for 2011
Dh196m
developer’s operating profit for the year
By Aya Lowe?Staff Reporter
© Gulf News 2012. All rights reserved.
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