Dubai - Arabstoday
Almost all of the investors in Dubai’s incomplete Palm Springs project have received a refund from the developer. Buyers on the project, which came to a standstill in the wake of the emirate’s property crash, reached an agreement with Damac Properties earlier this year, which gave them a full refund on their lost investment. Some 21 investors were paid by the company in January, followed by an additional 29 earlier this week, according to legal representatives. Only four investors have not yet received their money, either due to issues with paperwork, change of mind or a lack of response when contacted by lawyers. Speaking to Arabian Business earlier this year, Fareya Azfar, partner and head of arbitration at The Legal Group (TLG), who advised the investors, said they were “pretty satisfied”. She added that she did not know of any other UAE developer who had given a 100 percent refund in one payment without a court case being initiated against them. “In my opinion, the legal counsels in the UAE, especially those representing such defendants who have prima facie breached their contractual or legal obligations, should encourage out of court settlements more rigorously than they currently do,” she said this time around. “The claimant, even though they may be settling for less than what they could be awarded by the courts, is saving the upfront costs of taking the matter to trial, whilst the defendant is similarly saving on the costs and protecting its reputation.” Announced during Dubai’s real estate boom, Palm Springs was designed as a 25-storey beachfront development located on Nakheel’s Palm Jebel Ali island, but was halted amid economic downturn along with a flurry of other Dubai projects. Developer Damac Properties had attempted to cancel the project in 2008, but the move was fought by investors through meetings in the UK and Dubai. The company later agreed to try and reinstate the development via talks with master developer Nakheel, but the project was unable to get off the ground. Investors, who had waited eight years for construction to begin, were initially offered a 70 percent refund upfront, or 25 percent immediately followed by a further 25 percent annually for the next three years, which they rejected. Many expected to receive compensation for their investment.