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Abu Dhabi City Municipality – 19 July 2018: In the presence of HE Saif Badr Al Qubaisi, General Manager of Abu Dhabi City Municipality, engineer Eisa Omair Al Mansouri, Head of Lands and Properties Sector, has signed with Al Dar Properties five Real Estate Escrow Account agreements, with Abu Dhabi Commercial Bank as Account Trustee. The agreements relate to Al Saadiyat Walk, Jawher Al Saadiyat, Leilak, Azur, and Turquoise. The Agreements provide for the construction of about 1500 residential villas or property units.
Following the signing of the agreements, Al Qubais said, “The implementation of the Real Estate Law No (3) for 2015 echoes the commitment of the Department of Urban Planning and Municipalities to streamline the real estate market to bring it in line with the highest international standards. The aim is to ensure a haven for the interests of investors all related parties for the benefit of the entire real estate sector. It will assist in attracting investments and boosting the economic development and the sustained growth in Abu Dhabi. These agreements along with other similar agreements, provide an environment for the optimal implementation of the real estate law and regulations.
“Since the start of the implementation of the real estate law, the Abu Dhabi City Municipality has perceived an array of positive indicators highlighted by confidence and credibility; which are core elements of the relationships between all real estate parties. Equally, the marketing and promotional levels of these properties has thrived under the rules and regulations that protect the rights of all parties. The implementation of the system has also contributed to protecting the rights of investors,” added Al Qubaisi.
“The business of the real estate sector is governed by Law No (3) for 2015 which had been implemented as of Jan 1st 2016. The Law includes seven Executive Regulations that boost that the principles of governance and transparency, and protect the rights of all the concerned parties. These Regulations relate to common ownership of properties. Owners association, initial property registration, endorsement of fees, registration of real estate assessors, mortgages, project escrow account, and permits,” continued Al Qubaisi.
The five agreements are part of a series of agreements signed earlier with property developers, and leading banks in this sector. The Municipality will continue to enlist property development companies and banks to support the implementation of the real estate law.
The agreements contribute to the quality of services provided to investors, citizens and residents in Abu Dhabi Emirate. The role of the Municipality in this regard is a supervisory role aiming to complete and ensure the continuity of projects according to the specific real estate completion schedules.
According to the agreements, the developer is not entitled to withdraw any amounts from the project funds unless after the completion of 20% of the actual project phases. Instalments will be paid under the supervision of the Project Escrow Account Management Off the Plan.
The implementation of the real estate law as such ushers a new and sustainable era of growth in lands and real estate sector; which will be of benefit to the local economy, business community and community members. The five projects will have a great bearing on the development of Al Saadiyat Island and attracting investors and residents.
The executive regulation governing the project escrow account aims to protect the rights of investors, be it individuals or organisations, who buy properties off the plan and wish to pay the price of their units instalments during the construction process. A project escrow account is opened for depositing the funds paid by investors for developers against the building of their units. These funds must not be utilised in other projects or purposes, and the process must be under the supervision and monitoring of the Department of Urban Planning and Municipalities. The escrow account shall be managed by the account trustee bank licensed by the Department to provide escrow account services. For this end, the account trustee agreements shall be signed in accordance with the law and the executive regulation. At the same time, the escrow account agreement shall be drafted between the account trustee and the developer covering all matters related to the project. The existing projects in which completion rate has reached not less than 70% shall be exempted from the escrow account condition.
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