Investors in Abu Dhabi’s Tameer Towers plan to begin legal action in December after the developer behind the scheme failed to meet a scheduled delivery date of June 2011.
The group’s legal advisor said that up to 65 buyers in the Al Reem Island project will pursue arbitration against developer Tameer Holding Investment when a clause allowing 6 month delay in delivery expires next month.
Construction on the luxury scheme, which includes five residential towers, a 5 star hotel and a canal promenade, stalled this summer, meaning the project is unlikely to meet even the extended December handover date.
Mr Thabit Al Temimi legal adviser with Abu Dhabi based law firm House of Justice said that “By December 2011, legally, Tameer should deliver the whole project. Even if they start construction, it means nothing. My clients on the 40th floor cannot live in their apartment if it doesn’t exist. I am pretty sure we will win the case as it is simply my clients paid and then Tameer stopped developing and did not accomplish.”
Al Reem Island is a residential and commercial project located 600m off the coast of Abu Dhabi. The USD 30 billion project, led by state-backed Sorouh Real Estate, saw its first handovers to residents in April 2010. On completion, the island will eventually be home to around 200,000 people.
The Tameer Towers scheme is the latest in a series of slowdowns in the Abu Dhabi construction market, which last month saw the delay of its planned Louvre and Guggenheim museums. For developers, many of whom had banked on Abu Dhabi to offset the collapse of Dubai’s property market in late 2008, the stalling of projects in the UAE capital is a source of concern.
Mr Charles Neil CEO of Landmark Properties said that “Abu Dhabi is being prudent from a financial point of view but this will have a big impact not only on Abu Dhabi, but Dubai as well. This decision will also have a major impact on the construction sector. With fewer people working in Abu Dhabi, rents can expect to weaken and this will impact on Dubai. It will not be good for the real estate sector in both emirates.”
(Sourced from www.arabianbusiness.com)
