Dubai: Around 750 investors in Ras Al Khaimah's stalled La Hoya Bay project can now breathe a sigh of relief as the project will now go ahead under the guidance of developer Rakeen.
The investors, which include around 400 from the UK, have lost an estimated Dh300 million in downpayments, Wahid Atta Allah, executive director of Rakeen, told Gulf News yesterday.
Rakeen will absorb the loss of the downpayments, Atta Allah said.
Ras Al Khaimah Court recently appointed Rakeen as the judicial custodian for Khoie Properties, the original developer of the project.
Khoie Properties became insolvent and defaulted on land payments while Frank Khoie, chairman and chief executive of the firm, is still "in the hands of the system," Gulf News has learnt.
This prompted the Ras Al Khaimah Investment Authority (Rakia) to seek the court's intervention.
La Hoya Bay is an $800 million waterfront residential and leisure complex on Al Marjan Island. It comprises seven residential towers and over 1,400 residential apartments and also includes a shopping component, restaurants, swimming pools and tennis courts.
Atalla said the decision for Rakeen to take over custody of the project until its completion is good news for the emirate of Ras Al Khaimah and La Hoya Bay investors."It is definitely good [news] for both. We are very proud that the court made such a decision and we'll fulfill the dreams of the 750 investors," Atta Allah said.
Construction of the project is severely delayed and once the written court order has been received, the wheels will be put in motion to look at the design and construction will follow.
"We are starting the first phase, which is the residences. However, the project is subject to market conditions but we will be building the residences," Atalla confirmed.
Khater Massad, chief executive of Rakia, described the court order as significant.
"The RAK Court's decision to appoint Rakeen as custodian of Khoie Properties is a significant step that promotes and protects the welfare of investors and property buyers in Ras Al Khaimah. Furthermore, La Hoya Bay is a high-priority project as it is one of the key components of the first phase of developments on Al Marjan Island.
Although the money from the investors' 30 per cent downpayments is gone, they will only need to pay the remaining 70 per cent in five 10-per-cent tranches relating to construction milestones.
