Damac Properties awards Dh500m contract to Chinese construction company

Damac says China State Construction Engineering Corporation will build part of Aykon City development

Damac Properties on Thursday reported a slide in yearly profit as revenues declined. Courtesy Damac Properties

Damac Properties, the Dubai-listed real estate developer, said it awarded a Dh512 million ($139m) contract to China State Construction Engineering Corporation (CSCEC) to build a component of its Aykon City mixed-use project in Dubai.

The contract covers civil construction works for Tower C, the residential tower in the $2 billion luxury development overlooking the Dubai Water Canal, Damac said in a statement on Saturday.

Chinese state-backed CSCEC already won a Dh600m contract in February to build Aykon City’s Tower B – a 63-storey project comprising 964 serviced apartments and hotel units.

“After a thorough tendering process, we have chosen to expand CSCEC’s remit in the Aykon City project beyond Dh1.1bn, having awarded them the contract to build Tower B earlier this year,” said Ali Sajwani, Damac’s general manager of operations.

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Tower C, known as ‘The Residence’, will have a total built up area of nearly 1.8 million square feet across 62 storeys. It will feature studio, one-, two- and three-bedroom apartments, as well as an exclusive residents-only lifestyle and entertainment space called ‘The Club’.

Damac Properties reported a 46 per cent year-on-year fall in net profit to Dh378.2m in the second quarter of 2018, below the average Dh450.7m estimate of analysts polled by Bloomberg.

Revenues were up 11 per cent year-on-year to Dh1.78bn. Damac has roughly Dh5.32bn of debt on its balance sheet, and group chief financial officer Adil Taqi told The National last month that the company plans to lower the debt below $1bn over the next 2-3 years.