Realty Firm Oger Dubai Confirms Fallout with Daman

A subsidiary of Saudi Oger Limited, Oger Dubai a Dubai property developer said that a termination notice from Daman Real Estate Capital Partners Ltd. has been received for “The Buildings by Daman” project. It is a multi-purpose project comprising of 65 floors and this mixed-use complex is ideally situated at the Dubai International Financial Centre. The Daman Investments statement was issued on Thursday followed by the announcement.

In the statement the reason for termination of Oger Dubai is also mentioned as a Dubai based private firm had said that this decision of termination was based on the “disappointing performance of the contractor”. For this project Oger Dubai was the main contractor and has refused to agree with the Daman’s position.

A statement from Oger Dubai has said, “Oger Dubai recognizes that the economic conditions for the real estate industry remain difficult. Oger Dubai does not accept that the decision of Daman Real Estate Capital Partners Ltd. was based on the alleged performance related issues, but notes many key factors surrounding the Project. Oger Dubai has performed the works to high standards and in accordance with its commitments.”

Moreover, they have further added, “As this is the first such case that the Oger Group has faced during its long history of operations, Oger Dubai will consider its position and reserves its rights. Oger Dubai will take all appropriate measures to protect its interests and market-leading reputation.”

Oger Dubai was opened by The Hariri family's Saudi Oger Group as a part of the expansion plan of their group. Currently this group operates eight offices in Saudi Arabia, Switzerland, France, Morocco, Jordan, UK and Lebanon.

Dubai Property: DIFC Faces 40% Fall In Commercial Rent

According to a report from a leading consultancy firm CB Richard Ellis (CBRE), commercial rents in Dubai International Financial Centre (DIFC) have fallen by 40 percent in the last six months. The report said the rents have fallen by a considerable amount and landlords are offering further diminution on rents.

This property in Dubai is considered the financial hub of the city. It enjoys its unrivalled location, situated in the heart of Dubai city. Dubai International Financial Centre offers world class infrastructure which facilitates various companies to carry out their business effectively. According to Mathew Green, Associate-Director-Research suggested that the rent offered in DIFC is far suitable than several other locations in Dubai. With state-of-the-art facilities offered in Dubai International Financial Centre, it created huge demand for office spaces. The consistency of demand was seen since 2004 and 2008 had a long list of people waiting to book their space. This was mainly due to being located close to Sheikh Zayed Road.

Nicholas Maclean, Managing Director of CBRE said during the past one year drive in the market has been primarily from the financial sector, as several companies want to be situated close to DIFC. Other developments such as the business district of Downtown Burj Dubai- Emmar Square has created considerable amount of demand for office spaces. Not forgetting, Business Bay is one of the most renowned locations for office buildings in Dubai city. Since, all these developments are located on the Sheikh Zayed Road soon they would compete with the new World Trade Centre.

The CBRE report stated there has been a fall in rent in Dubai offices by 18%, during the first quarter of the year. The reports said, the landlords of the properties, located away from the business districts, are offering extra incentives to attract tenants.

Dubai eyes US shores

Dubai government’s finance and investment body Dubai International Financial Centre (DIFC) is eyeing US real estate companies. Dubai International Financial Centre is considering investment in American real estate as a golden opportunity in the wake of ongoing mortgage crisis in US real estate. In addition to real estate, DIFC is also planning to vest in US oil, gas and telecom sectors.

The mortgage crisis being experienced by US economy has made the share value of US plunge. This in turn has created a situation wherein investing in US real estate and other industries is has become cheaper.

Dubai’s US Connection Lately

2006 saw Dubai government-run Dubai Ports World (DPW) facing tough resistance from US political front on security grounds. So much so that Dubai Ports World had to sell recently-acquired ports operations in the US.

Dubai Ports World had acquired ports operations at 6 ports in the US but following objections from US politicians, had to sell them to US insurance company AIG.

What does future behold?

Dubai International Financial Centre is optimistic about investment opportunities on US shores. Early this year, DIFC got hold of 2 billion worth 2.2 percent stake in Deutsche Bank.

A Little About Dubai International Financial Centre

Dubai government’s DIFC offers standard regulations to capital investors in the UAE. Investors can hope to have efficient and transparent investment opportunities.

A few salient features offered by DIFC:

• Foreign ownership

• Zero percent tax rate

• No restriction on foreign exchange

• World class rules and regulations

• Transparent operations