Buyers' cash tied up in stalled Ivory Tower
Hundreds of property buyers in the long-delayed Ivory Tower project in Dubai fear they will lose their cash after work on the development stopped and consultants were called in to staff its Deira offices. Ivory Tower, planned in the International Media Production Zone (IMPZ), was fully sold off-plan in 2006 and is now almost two years late.
Mohammed Binghalib, the former director of the developer Sokook Investment Group, said he was "not with the company any more". The company's website has also been closed and is to be updated, says a message on the site. Sokook's office in Deira was manned by a consultant from Homes Real Estate yesterday. The consultant said the developer had hired his company, based in Dubai, to compile a "feasibility report" on the 700 customers who bought units in the sprawling 20-storey Ivory Tower.
Foundation work began at the site last summer but was stalled recently because most investors had stopped paying, said Khaled Mahmood, the consultant from Homes Real Estate. "I have to make a report to Sokook to see who is paying them and who isn't," he said. "For people who have paid more than 30 per cent, their money is in safe hands because they won't pay any more until we start construction again; for those who have paid less but don't want to pay any more, we will forfeit them. Our construction is on hold because of the people who only paid 10 or 15 per cent."
Mr Mahmood said the aim of the feasibility report was to find out how many investors were willing to continue with the project. If the development went ahead with, say, half the number of investors, the project would be scaled back by half, he said. Mr Mahmood added that an option for buyers would be to transfer their investments to other projects in Dubai that were either completed or nearing completion.
This would have to be done through agreements with other developers, he said, as Sokook's only project in Dubai was the Ivory Tower. "If there is no trust left in the project, then we can talk with the customer and swap their investment to a developer who is more advanced." He declined to name any developers with which Sokook had been in talks. Mr Mahmood's comments have done little to appease those who have waited almost four years for their homes to be built.
Investors formed an action group in 2008 when it became clear that the building would not be ready by the deadline, the middle of that year. The original delay was caused by a dispute over the land with TECOM Investments, the master developer of IMPZ. The row was resolved only with the help of the Dubai Land Department in the summer of 2008. Nigel Collins, an investor from the UK who bought four apartments in Ivory Tower in 2006, said many of the investors had given up the fight.
"It's a catch-22 situation. I would be open to transferring my investment somewhere else if it means I can rent or sell that property." @Email:firstname.lastname@example.org
Published: March 4, 2010 04:00 AM