Thursday, Mar 29, 2012
Gulf News
Dubai Property Developer Nakheel will not require a fresh capital injection to execute projects as market conditions improve, said acting chief executive Sanjay Manchanda following a tour of some projects.
“Nakheel doesn’t need any further financing to complete its ongoing projects as we have restructured our debts,” Manchanda said.
Nakheel, once Dubai’s largest property developer which built the Palm Jumeirah, part of a trio of similar palm-shaped islands, was badly hit by the global financial crisis that forced it to suspend most of its projects.
Following a debt repayment standstill request by its then-shareholder Dubai World, the company had to undergo a massive financial re-engineering to deal with creditors on restructuring more than $14 billion (Dh51.4 billion) of debts between 2009 and last year.
Sukuk issued
Post November 2009, Nakheel has made total payments of Dh7.6 billion to various contractors, creditors and suppliers. Following the successful completion of its restructuring, the developer has also issued a sukuk of Dh3.8 billion to its trade creditors and made a total payment of Dh320 million in interest and profits to its lenders to date. This has helped it to return to business.
The company has re-started work on some suspended projects and at the same time repaid some debts from the Dubai Government’s Support Fund.
“We don’t have loan repayments due this year. We are still paying the interest but the principal remains the same,” he said.
Nakheel yesterday announced the completion of 1,940 units in its projects, including the Jumeirah Heights cluster, Mansions in Jumeirah Islands and a housing project for UAE nationals in Dubai International City.
Manchanda said: “Nakheel continues to meet its planned targets and we are delivering the developed units to the respective owners in accordance with the restructuring plan.”
Nakheel is to develop a total of 8,252 units across various projects. While they have already delivered 3,549 units, the remaining units are planned for handover later this year and in 2013.
“The real estate market is showing sings of maturity. Rents are increasing and selling prices are rising as well,” Manchanda said.
“All this is vital for Nakheel’s growth. Compared to the past few years, Nakheel properties, especially those on the Palm Jumeirah, [have appreciated], selling at Dh1,500 per square foot.”
While Nakheel is working on almost 12 projects, he said that they are planning and evaluating future projects as well.
“We are going to launch a new project, Palma Residence next month,” Manchanda said.
Nakheel, which built a number of neighbourhoods and property clusters — such as the Palm Jumeirah, Jumeirah Lake Towers, International City, Jumeirah Park, the Gardens and Discovery Gardens — at the height of Dubai’s property boom, has contributed to the growth of the emirate’s economy.
Positive market response
Manchanda, however, declined to reveal how his company is financing the new projects.
“Of course we have several ways, but I do believe that the market would respond positively to our requirements,” he said.
Future projects will be announced based on market demand and the specific needs of Nakheel communities, he said.
While Nakheel is committed to fully implementing its restructuring plan, the company is also working closely with the government in carefully planning and evaluating future projects to ensure it plays its role as a master developer that contributes to the growth of the real estate sector in the emirate, Nakheel said.
The company is witnessing almost 100 per cent occupancy across its residential portfolio, reflecting a much improved residential sector compared to the past few years.
Further, the retail sector continues to prosper in Dubai and remains the focus area for the company.
Dubai Dubai-based Kele Contracting announced it has been awarded the contract to build a multi-storey car parking facility for Dragon Mart. The contract to build and maintain the car park project was awarded by Nakheel.
The multi-storey car park facility is being built to cater to the increasing number of visitors and shoppers at the centre, especially after Dragon Mart’s expansion.
Additional spaces
Built over approximately 62,000 square metres, the access-controlled car park will provide approximately 1,894 additional parking spaces spread over four storeys as well as underground parking, and will feature the latest in car parking engineering, such as high-speed elevators, natural ventilation and lighting as well as advanced fire and safety specifications.
The new car park facility is located adjacent to the Dragon Mart building on the Hatta–Al Ain Highway.
Construction started early this year and it is due for completion by year-end.
By Zaher Bitar?Staff Reporter Staff Report
Gulf News 2012. All rights reserved.
