Dubai Construction Update: April 2010

Friday, April 30, 2010

‘Paradise Lakes Towers’ new construction-linked payment plan ensures completion and delivery by 2011

‘Paradise Lakes Towers’ new construction-linked payment plan ensures completion and delivery by 2011

April 30, 2010

R Holding and the Real Estate Investment Corporation (REIC) of Ajman have announced the launch of a new construction-linked payment schedule to ensure delivery of ‘Paradise Lakes Towers’ project by end of 2011 - a move that reflects the developer's determination to complete the project by the new deadline, which has been approved by ARRA. This follows the significant impact of the global economic tsunami on the world's real estate and other vital sectors, which resulted in the delay or cancellation of a huge number of real estate projects in the region and some parts of the world. The newly introduced payment plan will ensure that payments of installments will be made based on construction progress, which will be monitored by ARRA.

Under the terms of the new payment scheme, investors of ‘Paradise Lake Towers’ will be required to continue paying the remaining construction-linked installments, which would be channeled by Sweet Homes into the project's escrow account. The remaining 10 per cent would have to be paid on handover, upon which the transfer of title deed and registration will be affected in the names of the investor or Sweet Homes Holding. To further assure the speedy progress on the project, the developer has now undertaken the construction and infrastructure works on eight buildings within ‘Paradise Lake Towers’, including B2, B3, B4, B5, B6, B7, B8 and B9. ARRA underlined that understanding and cooperation between investors and developers will ensure timely completion of a project and avoid further postponement.

“The negative impact of the global economic meltdown and lack of cash flow have resulted in a delay in the construction and delivery of many real estate projects in the region as well as the AED 785 million residential complex in Ajman,” said Fahad Sattar Dero, CEO, Sweet Homes Holdings. “Industry professionals and some real estate experts have acknowledged that the delay in construction of real estate projects and investment buildings is beyond the developers' control, while others consider the current unprecedented financial crisis a ‘force majeure. By shifting to the new payment plan, investors are being assured of the project’s completion and delivery by December 31, 2011.”

Named after the lakeside views and surrounding lush greeneries, ‘Paradise Lakes Towers’ is a 20-minute drive from the Dubai Airport, and boasts of a 15,274 sq. feet entertainment zone, and a five-story built-in parking, four high-speed elevators, a full floor of exercise facilities, a swimming pool and game area, central air conditioning, and satellite TV in all the towers. Designed by the Adnan Saffarini Engineering Consultants, the project is part of Emirates City, a development comprised of 92 residential and commercial towers.