Deyaar cuts 20% of staff

Deyaar Development has laid of about 60 people, or 20 per cent of its staff, as the downturn continues to blight the emirate's property sector.

Deyaar Development has shed 60 jobs as the downturn continues to affect Dubai's property sector. Thousands of jobs have been lost in the property industry over the past year as demand for new homes has waned but this is the first time Deyaar, Dubai's second-largest developer, has cut back on staff since the start of the downturn. "This rationalisation of resources has been carried out to support Deyaar's sustained growth and maintain its commitments to customers, partners and shareholders in the most efficient possible manner," the firm said in a statement to the Dubai Financial Market. The developer said the cuts, equal to about 20 per cent of its staff, were part of the firm's "three-pillar strategy", announced earlier in the year that included measures to reduce customer defaults. Deyaar has also created a distressed asset fund, which will buy back properties from customers who have defaulted on their payments with the intention of selling them when the market picks up. The fund has commitments of about Dh300 million (US$81.6m) in property assets, and is looking to raise another Dh200m. The company posted a 74 per cent decline in third quarter net profit to Dh81.6m from the third quarter last year. Due to the financial crisis, projects have stalled and prices have dropped by as much as half from last year's peaks. Nakheel, the developer of Dubai's Palm islands, has fired about 1,000 workers. Damac Properties, Omniyat Properties, Tameer and Limitless have also shed jobs. Many construction firms, including ASGC, Al Habtoor Leighton Group and Aldar Laing O'Rourke, a joint venture between Abu Dhabi's largest property developer and a UK construction company, have also reduced their workforces this year. "It's difficult to put a number on how many people have been let go as some companies have been transparent and others haven't," said Matthew Taylor, the international director of the recruitment firm Macdonald and Co. "A number of companies have gone through their various rounds of redundancies - they've pretty quickly cut themselves down to their core in order to deal with the work they have." Firms have also reduced salaries, asked staff to take unpaid leave and moved people to busier areas of the region as they cope with the slowdown in Dubai. Salary levels for expatriates working in the property and construction sectors have fallen by up to 30 per cent across the GCC, according to data from APG Global, a recruitment agency based in Australia. Mr Taylor said hiring among property companies had improved compared with six months ago, and a further lift was anticipated in the first quarter of next year, albeit at a slower rate than during the property boom. [e-mail]