Wednesday, Sep 21, 2011
Gulf News
Dubai: The chairman of real estate developer Nakheel said yesterday he can now sleep at night following the completion of the companys Dh59 billion debt restructuring.
Ali Rashid Ahmad Lootah, who was meeting with contractors at Nakheels Jumeirah Islands development, said the developer would hand over more and more property units in the coming months as the company enters a new chapter.
Nakheel, which issued Dh3.8 billion worth of Islamic bonds to trade creditors last week, has experienced a tumultuous three years.
The developer wrote off up to Dh78.6 billion of its real estate assets after Dubais property market eased in 2008.
The old chapter will not come back. The contractors are back on site there are 25,000 construction workers across our projects and they have trust [in the company], Lootah said.
The Government of Dubai has done lots to deliver in difficult circumstances. They had other choices, but they chose to commit and deliver to Nakheel, he said.
Nakheel, which also plans to auction a Palm Jumeirah villa on Sunday, has mitigated Dh6.2 billion of its customer liabilities on long-term projects through offering credit notes or homes in finished projects.
At the vast Jumeirah Islands Mansions project yesterday, hundreds of construction workers could be seen shovelling sand, transporting heavy equipment and installing systems as Nakheel looks to speed up the core element of its business delivering properties.
This is one of our projects [Jumeirah Islands Mansions] that is almost completed. We expect the handover to begin early next month, which shows our commitment towards delivery. Jumeirah Islands is one of our earliest and most luxurious projects. But due to the economic crisis it was one of the projects that we had to put on hold. There have been delays, but there has also been a lot of commitment to completing these projects. Lootah said.
However, some analysts say it will not be easy for Nakheel to move on to the next chapter without being reminded of the issues faced over the last few years.
There has been a lot of negativity around Nakheel and it is not a surprise they are trying to turn over a new page in their history. However, I do not think the market will allow them do that, said Matthew Green, head of research and consultancy for the UAE at CB Richard Ellis Middle East.
Nakheel has a lot of reputation building to go through. But that could be offset by delivering projects and managing them well. For example, Emaar Properties continues to build communities that people want to live in and that is a model Nakheel could work towards; at the moment they are associated with issues such as debt and community charges, he added.
By Kevin Scott, Staff Reporter
Gulf News 2011. All rights reserved.
