Schön Properties, developer of the AED 3 billion Dubai Lagoon project, has confirmed that full refunds will be given to all investors that purchased units scheduled for completion by December 2007. The refund policy has been extended by Schön as an act of goodwill after confusion amongst some investors in regards to the project phases and revised completion dates.
Delays in completion of Dubai Lagoon have been the direct result of unanticipated civic and transportation infrastructure alterations, which have set back construction and produced scheduling issues. “We at Schön Properties applaud and fully support the efforts of RTA and other government agencies to make Dubai a better place and we have re-designed our project to accommodate mandatory infrastructure developments imposed subsequent to the launch of the Dubai Lagoon,” said Nasir Husain, Co-Chairman of Schön Properties.
Schön has been in discussions with RERA to clarify the situation and reach a fair solution for all parties. Whilst not common practice in the UAE, the revised refund policy was approved by Schön Board of Directors during a board meeting held on Tuesday 19th August, to accommodate investors and demonstrate good faith. Investors, who purchased units with a completion date of December 2007, are eligible for a full refund and are directed to apply for this prior to September 15th 2008.
In a recent statement about Schön Properties and the Dubai Lagoon, Marwan Bin Ghalaita, CEO of RERA, characterized the objections of some investors as “a misunderstanding”. He said, “Schön [Properties] is a registered developer with us and they have an open trust account and all the money from the Dubai Lagoon [project] is in trust account handled by the Land Department and RERA. Furthermore, RERA issued a press release earlier this week dismissing reports that the project had been cancelled and pledging continued involvement and monitoring of construction works.
Schön has also confirmed that the agreement with the original contractors Powerline Gulf has been renegotiated to include the first two zones and construction is due resume in the coming weeks. The first zone is now set for completion within 13 months and the second zone is set for completion within 18 months as of July 28th. Negotiations with another leading contractor to handle the remaining zones are currently being finalised of which official appointments by Schön will be announced shortly.
“While certain investors are understandably frustrated and upset by the delays, the vast majority have demonstrated great understanding and patience and have expressed confidence in Schön Properties and support for the Dubai Lagoon project. It is not in the best interest of any parties involved with the project, including developers to delay construction, as material costs are exponentially rising. Therefore we are aiming to deliver the project in the timeliest manner given the unforeseen circumstances,” concluded Husain.
