I purchased an off-plan, one-bedroom apartment in Dubai in February 2018. At the time of purchasing, the developer informed me that the apartment would be complete in the third quarter of 2018. That time approached and then the third quarter became the fourth quarter of 2018 and so it went on. To cut a long story short, the developer now predicts handover will happen sometime in 2021. The property has been registered with the Dubai Land Department along with a Land Number and a UAE ID number. As I no longer live and work in Dubai I would ideally like to sell the property. What I want to know is: what should I do given the uncertainty over the completion date? And, do I have any case for redress with the developer from a legal perspective over the inordinate delays so far? MJ, UK
Delays in handover from developers is the norm, I'm afraid to say. Many blame reasons such as force majeure, some rely too much on sales to fund the project and others have funding problems via the banks. The law states that a developer can handover with a delay of 12 months but this can also be stretched out due to the reasons above along with many others.
According to the developer's website, the delivery date for the project is the fourth quarter of 2020 making it approximately two years overdue. The webpage goes on to state the structure is at 49 per cent, so there is still much to do including the mechanical, electrical and plumbing (MEP), not to mention the finishing works. That said the delivery date may take even longer.
Like many developers, this company has had issues in the past with many aspects of real estate from building delays giving rise to late delivery of units to maintenance and customer queries.
The developer recently restructured and streamlined the business to become leaner. They had close to 1,000 employees on the sales side but have trimmed this to a couple of hundred today stating their focus now is on delivery of the projects. I realise that from your perspective this may seem empty words but this may have a positive effect on the delivery date of your unit
Despite the annoyance of waiting way beyond what is reasonable, I would continue to wait and see it out. The reason being is the project itself. The location is good both geographically and strategically, given the Metro will link up with the rest of the transport system, and a large mall is scheduled to be built nearby.
While nothing is guaranteed, I believe this developer is too large to fail. It may have bitten off more than it can chew as it has dozens of ongoing projects that are scheduled to be built by 2023 and more than 100 in planning, so delivery on time could be challenging.
In terms of any redress for this delay, I urge you to carefully read your Sale and Purchase Agreement. This will indicate what redress if any you have given the delays.
If there is no clear path to satisfaction, your alternative could be to file a case at the civil courts for breach of contract in order to get compensation. However, this route can be expensive and certainly time-consuming, so it is up to you to decide if this is a viable option, especially as you are no longer a resident of the UAE.
Mario Volpi is the sales and leasing manager at Engel & Volkers. He has worked in the property sector for 35 years in London and Dubai
The opinions expressed do not constitute legal advice and are provided for information only. Please send any questions to mario.volpi@engelvoelkers.com
