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Eye Tower- They are now pushing for payment- have approva from ARRA to confiscate whatever we have paid so far?

I bought an office space at AED 600 per squre foot. in Eye tower, which was due for completein in December 2010, with a grace period of maximum 6 months . ( June 2011)

I have already paid, AED 106,000 which comes to 22.5% since February 2008

I reuglarly have been visiting the site over the last two years. No construction was started until two months ago and that too is with very minimal labor. More like a show off to satify the ARRA and grab more money from us.

I never received any wrtitten communication from them since November 2008, when I visited their office to pay my checks.

They have recently started the construction and now claim to have completed 9.33% and want the payment to reach 29.33% ( 20% + on the completion).

They have also sent a letter from ARRA authorising them to cancel our contract and if no payment is made within 20 days than they have the right to cancel the unit and consider the prevuiously paid amount as liquidated damages.

Can some one explain:
1.Can the developer now unilaterally decide to eat our money at their own discretion.
2. what is a liquidated damage and when can this be applied by the developr.
3. What can I do to avoid/ minimise my losses, since my balance payments (AED 361,600) due far exceed the current markt value (AED 169,000 = 768 sq ft X AED 220 /sq ft.).
4. Can I enforce the repayment of my amount since they failed to perform their part of the contract,

You said in no. 3 that your

You said in no. 3 that your due payment exceeds the current market value. Then the first thing I will tell you is:
1- If you still want a property, then go and with that due amount buy a ready property. Why would you give the money to people who have achived only 9% and who will propably NEVER finish construction?!
2- If you no longer want a property, then keep your money because it is very dumb trying to save your money with more money that is more than the current market value. Right?!
In either case, make a separation between the amount you have already made and any new future payments. Write a letter to the developer explaining why you are not paying ( delay in construction, doubt about developer's achivements, doubts about other issues like visa and services....etc.) and send a copy to ARRA. If you live in UAE, then go and visit ARRA and explain to them why you are not welling to pay.
Your strategy should be: the current value is less than 50% of the price and I have already paid a lot and there is a lot of doubts and I will be happy to pay all due amount upon completion and hand-over of the property.Good luck

Josau's picture

Good advice from qwert. I

Good advice from qwert. I totally agree.

Josau's picture

Can you trace when they

Can you trace when they actually got approval from ARRA and when they got the escrow account? If this was after may 31st 2009, they were actually already at fault as this was the dead line by decree of the Sheikh. i know, this doesn't mean much in these countries as everything is inshallah, but you have a point. I actually went to ARRA and got a letter, that my developer was not approved at such and such a date. it cost me 50 dhs to get this in arabic with an english translation. This proves, that the developers was at fault.

Musafir's picture

why get that such

why get that such declaration from arra that your developer in default josau ?

ie how does it assist ?

Musafir Moderator

Josau's picture

I got this, as many did, so

I got this, as many did, so at some point in time I have official proof that my developer was at fault. Of course in the unlawful environment of Ajman I have no idea if it will be of any use. It is just something to hold on to.

akhiabani's picture

Eye tower

I have requested full refund from rholding for eye tower, but no reply yet... This is set up at a 6 year payment plan with 47% payment till completion. I am not sure where that 20% rule is coming from, but it is illogical. That means fully paid amount with only 80% completion of construction..

akhiabani's picture

Eye tower

Is your office the one that you originally purchased or one of the the ones that they are forcing on you?

This was originally

This was originally purchased by me in Eye Tower.