Dubai developer Limitless pledges to repay debts by 2016

Property developer Limitless has pledged to repay all of its creditors by 2016 as part of the $1.2 billion (Dh4.4bn) restructuring agreement it struck last week.

Ali Rashid Lootah, the chairman of Limitless, said that under the terms of the agreement, the developer had agreed to pay contractors and trade creditors in a one-off interest free "bullet payment" inShow more

The property developer Limitless has pledged to repay all of its creditors by 2016 as part of the Dh4.4 billion (US$1.2bn) restructuring agreement it struck last week.

Ali Rashid Lootah, the chairman, said yesterday that under the terms of the agreement, the developer had agreed to pay contractors and trade creditors in a one-off interest free "bullet payment" in 2015, while banks would be paid in a series of instalments between 2014 and 2016.

He declined to say how much of a hit lenders would take on their loans, adding that the commercial terms of the deal were confidential. Asked whether the payments to creditors would be financed through asset sales or other means, he said, "the options are open".

Limitless' Islamic lending facility with a syndicate of banks was signed in 2008 and originally due to mature in 2010. The company was not part of Dubai World's $24.9bn restructuring announced in March last year.

Mr Lootah said Limitless would be transferred to government ownership "in the near future" and he hoped by the year end. He declined to comment on whether this would mean a change in management or strategy.

The UAE-based Islamic home finance provider Tamweel announced yesterday that 90 per cent of the mortgages it agreed between January 2011 and June this year were to owner occupiers.

Average loan to value ratios for borrowers, it added, had fallen from 80 per cent in 2008 to about 75 per cent today.