Dubai Forums Dubai Business Dubai Business Talk

First of all, I don't know if this is the right section to post this so sorry if it isn't.

Anyway,

I'm sure a lot of people know about the lighthouse incident and it seems another one has fallen through aswell (Dubai Star in the jumeirah lake towers).

I'm thinking though, how many more will follow.
I know this is pure speculation but the Wind Towers (also in JLT) seem to be heading in the same direction, damac seem to be struggling a bit too. I'm not saying damac are the types to run away with your money since they are actually building their towers. Unfortunately, everything apart from the exterior of their buildings seems to suck.

It's important to note that the investors in the lighthouse have not been compensated so if more projects fall through it could be a disaster. I think it's because of construction costs that this is happening, a developer might have estimated the cost at the start but with rising costs he has to go overbudget or cut corners. Also some developers really underestimate the costs for example, the "Marina 101" (that is 415m high) is to cost 1.4bn aed. Sears Tower is about 450m high so that should give you an idea of how big this thing is so it seems worrying because even with the slave labour going on it'll cost at least twice as much.

I'm wondering how many more developments will bite the dust and would you say investors will be compensated?

Unfortunately this is going to happen wherever this is a demand for property and numerous developments going on. underestimation of costs is partly to blame, but one must investigate these facts before making an educated decision.

In Australia we have witnessed many many property scams where the developers take the money and run. It is more a sign that the market is in high demand that unscrupulous people come into it rather than the market being on shakey terms.

I wouldn't worry too much about Damac as they have deep pockets, and it is always a good idea to treat ANY personal investment with healthy skepticism.

Also remember, if something is too good to be true, it usually is, that and a fool and their money are soon parted.

dannyM wrote:damac seem to be struggling a bit too. I'm not saying damac are the types to run away with your money since they are actually building their towers. Unfortunately, everything apart from the exterior of their buildings seems to suck.

Useful links to read, thanks.

It was reported yesterday that Damac intended to launch an IPO. But you'll have to wait a bit - they said within the next three years. Slow, like their buildings from the sounds of it. Big company but even the big ones can go bust ...

Very true SW

THe bigger they are the harder they fall.

If anyone remembers the awful scams that were going on in Europe and USA with the sale of "Timeshare" back 10-15years ago. But it wasn't all bad, some were great actually. It was real hard to sort the good from the bad though.

Here in this market today, so much money is floating around and it seems that people are falling over to get rid of more in search of their impossible dreams. I hope that a lid is kept on everything and that if developers get away with peoples money, they should be caught and punished.