Emirates City Forum

Investors demand payback from Ajman developer
Feb 11, 2010 at 16:53
By Shakir Husain
http://business.maktoob.com/20090000434734/Investors_demand_payback_from...

More than 50 investors in an Ajman property project are demanding their money back from real estate developer Goldcrest Properties after a construction delay of more than 18 months.

But the company behind the 2 billion dirham ($545 million) Goldcrest Smart Towers development, which was to construct 3,500 apartments in eight buildings, has told them that it has no money to refund according to a spokeswoman for the group.

“We are not in litigation and interested in arbitration and out of court settlement … but we are ready to take it to the end if the need arises,” said Saima Saqlain, who claimed to speak on behalf of 55 buyers in the project.

“They have agreed to meet us and discuss options although he said refund of money was out of question as our money was used to pay for the land bought for the project,” she said.

The investor group will hold a meeting with Goldcrest Properties Managing Director Amir Giga on Sunday to resolve the dispute.
The Goldcrest Smart Towers were to be built within the Ain Ajman (Eye of Ajman) project, where work has stalled in the UAE’s real estate market collapse.

Goldcrest Properties Chief Operating Officer Parvees Gafur told Maktoob the company is offering the Ajman investors an option to property in its Dubai projects.

“We are not cancelling the Ajman project. There is a delay because the master developer has not created the necessary infrastructure,” he said.

“We have already offered these investors properties in our Dubai projects. We are talking to them and we will discuss their concerns during the meeting on Sunday,” he added.

Such disputes have grown in number in the UAE’s real estate market since its crash in late 2008. The emirate of Ajman, a relative latecomer to the regional property boom led by Dubai, is among the worst victims of the real estate slump.

Mortgage lending in the country remains scarce as banks try to recover from bad loans they made to property developers and buyers, many of them speculators, during the boom period.

Many projects announced during the boom period have been delayed or scrapped altogether, leaving a trail of angry investors who had bought into some of these plans.