Pearl Dubai, the glitzy but troubled development near the Palm Jumeirah, has received a major injection of confidence and cash via a US$1.9 billion deal with a Hong Kong-based investor.
The development, launched in 2009 at the height of the global financial crisis, has sold about one-third of the sellable land in the 20 million square feet project to Chow Tai Fook Endowment Industry Investment Development Group (CTFE).
“This is a landmark transaction,” said Pearl’s chief executive Santhosh Joseph. “We are delighted with this opportunity to tap into the considerable potential of endowment funds from China. This transaction brings us closer to making Dubai Pearl a fully funded project.
“ Once complete, Dubai Pearl will be one of the jewels in the crown of Dubai; a revolutionary project which sets new standards in world-class, sustainable development.”
The assets sold include high-end residences and two five-star hotel sites. The Hong Kong firm said they would be partly kept by CTFE, and partly sold to “high-end clientele in the Far East seeking good rental returns as well as property value appreciation.”
Deepak Jain, head of strategic consulting at the property consultant Jones Lang LaSalle, said: “The Pearl is a very strategic location, and on fundamentals it looks a good investment. We’ve seen a big increase in Chinese investment in Dubai property, in line with the rise in tourism and the resident population.”
CTFE is a diversified conglomerate which focuses on developing Chow Tai Fook districts – a mix of upmarket retail, leisure and residential areas in Chinese cities – in partnership with China’s ministry of civil affairs. Its name roughly translates as “good fortune.”
The company’s billionaire owner, Cheng Yu-tung, built up the business on the back of a chain of jewellery stores in Macao, Hong Kong and China.
Dubai Pearl was originally due to have been completed last year, but it was scaled back and delayed by the Dubai property slump. One of its original investors, Dubai International Financial Centre Investments, pulled out after only investing a fraction of the multibillion dollar cost of the project.
The project’s current owner is a free zone company controlled by a consortium led by the Al Fahims, a prominent UAE investor family. Its chairman, Aamer Al Fahim, said: ““As one of the region’s pre-eminent developers, we have always been strong believers in the sustainable future of Dubai. We are proud to be creating a landmark development which will strengthen Dubai’s reputation as a leading global destination for business, retail, leisure and tourism.
“We are grateful for the continued support from Sheikh Mohammed bin Rashid Al Maktoum, Vice President of the UAE and ruler of Dubai, and our master developer, Tecom,” he added.
Jason Chen, chairman of CTFE, said: “We selected Dubai Pearl as our destination partner to develop Chow Tai Fook districts internationally starting with Dubai, because of the vision and quality of their project offering. We are proud to be part of the project and looking forward to a long and prosperous relationship.”
fkane@thenational.ae
