Cobblestoned walkways lined with cafés and restaurants, the beach vibe, a bustling stretch where tourists lounge around and indulge in high-street retail therapy — The Walk at Jumeirah Beach Residence (JBR) is all this and much more. But for those who invested millions buying into the value proposition offered by JBR — envisaged as a beachfront community of luxury living, replete with beach parks, gymnasiums and beach clubs — it still leaves much to be desired.
Though JBR is spread across five sectors (Amwaj, Rimal, Bahar, Sadaf and Murjan), it is at the strategically located Rimal where much of the action unfolds, courtesy of the umpteen popular restaurants dotting this stretch. Contrary to its literal meaning, The Walk is often populated with large four-wheel drives and cars that cruise around JBR for hours, raising the hackles of residents. Robert Pacella, a homeowner and interim board member in Amwaj 4 says, "Traffic in and around JBR, especially after 6pm, is terrible. What makes it harder to bear is that more than 90 per cent of the traffic is not resident traffic; the majority is the direct result of The Walk. Much of the traffic doesn't even park. The traffic doesn't clear until 2am during weekends. There's a great deal of dangerous driving and ‘traffic-light-racing' near JBR; it creates noise pollution, air pollution and there's a real danger of pedestrian injury and collisions between cars."
Residents' requests to block non-resident traffic access between buildings after midnight has not elicited any favourable response from Dubai Asset Management (DAM), the management arm of developer Dubai Properties Group (DPG). "It just seems incredible that it needs to come to traffic chaos before the developer is forced to act," adds Robert. "To put it in perspective, on a weekend, to drive one lap around JBR can take 45 minutes to an hour because it's gridlocked. Now imagine that you're a resident, trying to get in or out of your home. This is the kind of traffic that you'll have to deal with. It's just appalling."
Undelivered community amenities
Lush beach parks and beach clubs in the original JBR master plan swayed a lot of investors and homeowners to commit funds to the development. Today, what sits in their place instead are car parking zones and a sales centre respectively. At the recent annual general meetings (AGMs) convened by DAM, interim owners associations (OAs) were expressly told that DPG intends to remove the beach parks and clubs from the master plan and to pursue alternative commercial arrangements at these sites. Residents cite clauses in their sales contracts that permit the developer to vary the master plan, but only on condition that it doesn't substantially affect the property. "It is open to debate on what changes are in fact allowable under the law and the sales contracts which residents hold with DPG," Robert argues.
The Plaza level in all sectors of JBR is characterised by major vacancies today. Poor accessibility from The Walk has made retailers shy away from leasing space in the Plaza level. "DAM claims it will soon convert the several vacant retail units in the Plaza level into fitness centres. One gym has been planned for each sector in JBR," says Phil Sheridan, an interim board member in Rimal 2 and group CEO of Fine & Country, a leading real estate consultancy. However, a few other disgruntled owners fear the addition of gyms will ratchet up service charges. "If a gym goes into the building now, it will undoubtedly hike the service charges under the sinking fund expenses. It's not going to be paid for by the developer, as it was originally envisaged," suggests Dr Paul Rogers, an interim board member in Rimal 4.
Risk of fire in the car parks
Meanwhile, a major health hazard is taking ominous shape in the ground floor car parks of the Rimal sector, where restaurants based in The Walk emit exhaust fumes. "At night, the entire ground floor car park is like a smoke den. The smoke and fire alarms have been de-activated in the car parks. If a car catches fire, it could result in an inferno," worries Paul. With around 30 storeys of residential space sitting atop these restaurants, civilian defence measures ought to be deployed, and now.
Another issue dogging JBR residents is the abuse of their store rooms, which are currently used by restaurants to store their food waste. "The rooms are in a filthy state and require constant cleaning because of the grease, oil and food waste which is stored for several days at a time before being cleared away," complains Robert. "Cleaning also costs money and this has an impact on service charges. Residents have been complaining for years and it's also a health and safety issue as the food waste attracts rats and insects," he adds.
The current service charge being levied on JBR homeowners is Dh15.32 per square foot. A breakdown of the costs reveals that almost half of the total budget for a tower is spent on electricity and air conditioning costs. For instance, the air conditioning costs for the common areas of a JBR tower alone amount to a whopping Dh1.6 million per annum. Appalled at these results, a group of homeowners performed an independent inspection, which revealed that certain retail and commercial units in JBR had no individual meters for district cooling or power. In fact, these developer-owned properties on The Walk were supplied utility services free, courtesy of the residential blocks.
"Most of the restaurants on the Plaza level don't have in-built toilets. So, kitchen staff come out and use the toilets on The Walk, which is what we pay for," says Paul. "During the Music Festival, for instance, the electric equipment was plugged in at JBR. But that was a Du promotion, and had nothing to do with JBR. This is, however, reflected in our electricity bills. Salwan and DAM get the revenue, but it's not reflected in our accounts," Paul adds. "Also, we are being charged for ten security guards in our tower. We don't need guards at the car park entrance if our access cards work. We're also charged for ten cleaners, while we are serviced by one. These are the hidden costs in our service fee. We will appoint one of the top four accounting firms to do professional audits once the OAs are registered."
Delinquents barred from voting
While DAM has been pro-active in calling for AGMs to elect interim boards, a precursor to registering OAs with the Real Estate Regulatory Agency (Rera), it is denying JBR owners who are not up-to-date with their service charge payments to vote or contest for board positions. Says Paul, "We had the first AGM in Rimal 4 in February. We were instructed to lodge a document 24 hours prior to the AGM if we desired to be on the board. On the day of the meeting, DAM sent me a notice that I was not financial; so, I could neither vote nor be voted for. I disputed this." Once the interim boards in JBR agree on the service charge budget for 2011, a trust account will be set up for each tower, into which service fee remittances will be made.
Owners in JBR hope an audit of the income and expenses incurred while operating tower blocks will help rationalise costs and bring down service charges. The decline in labour costs and the developer's intent to remove infrastructure from the original master plan are likely to have a downward impact on service charges. However, OAs will be saddled with service charge recovery, a tough call given the percentage of bad debt and delinquents in each tower. For instance, Phil says, "In Rimal 2, 50 per cent of owners have fully paid their service charges, 20 per cent are in arrears and 30 per cent have not paid maintenance fees, except in the first year. So, the debt within Rimal 2 alone amounts to approximately Dh2.5 million. One of the remedies open to the OA is to enforce a lien against such units."
DPG had not responded to our queries on these issues at the time of going to press.
Jumeirah Beach Residence (JBR) continues to be a leasing hotspot, with rents being fairly resilient to the freefall elsewhere in Dubai. The average rental for a studio in JBR ranges from Dh45k-50k; Dh70k-80k for a one-bedroom unit, and Dh95k-110k for a two-bedroom apartment. "Landlords will negotiate slightly on price and number of cheques, but are not offering other incentives," explains Andrew Williamson, leasing agent, The Property Store.
Meanwhile, the average sales price in JBR ranges from Dh750 to Dh1,150 per square foot, according to Murtaza Hussein, a sales agent at The Property Store. However, these rates vary depending on the location in the building, view and the sector. The community attracts European and Iranian buyers and tenants.
For information on the real estate sector, within the UAE, please visit our sister site, GNProperty.com.