Dubai: Bank debts and stress is piling up for investors who paid millions, some their entire life savings, for property in a landmark New Dubai development that's delayed by four years.
The Real Estate Regulatory Agency (RERA) confirmed to XPRESS that it is reviewing The Vue De Lac towers - two residential towers and a business tower - at Jumeirah Lake Towers.
Shockingly, the main construction work has not begun till date despite the towers having an initial completion date of 2007.
As a result about 60 investors who paid up to Dh1.7 million for their apartments, are accumulating interest on mortgages taken out for the property.
Stress has been the biggest headache for Filipino expat Jimmy Mariano whose marriage almost fell apart after he invested Dh400,000 - his savings over 10 years working in Dubai - and took a Dh932,000 mortgage from Amlak Finance to pay for a two-bedroom apartment in one of the towers.
"It has almost cost my marriage. My wife was so upset that I put my life savings into this," said the middle-aged father of one who has to pay about Dh70,000 to rent accommodation until he can move into his JLT home.
Amlak documents reveal that it released Dh533,000 of Mariano's loan to the developer Al Attar Properties in 2008. However, as of date only 15 per cent of the property has been completed. Since 2008 Mariano's loan has accrued over Dh100,000 in interest.
Rera and the main developer, Dubai MCC, were currently reviewing the project, a Rera spokesperson said. They assured investors the project had an escrow account - an account overseen by the Land Department which buyers pay into for an off-plan lot. The money is released to the developer a year after all units are registered in purchasers' names. "The project is currently registered at Rera and has an escrow account, ... the investors will be provided with a detailed final completion schedule," the spokesperson said.
Al Attar declined to explain the four-year delay when contacted on Wednesday. Al Attar had told XPRESS in 2009 that investors would not be getting their money back. "We don't want a panic. If we hand the money back, the towers won't be completed," Bipin Tavarool, Project Manager for Al Attar Properties, had said in November 2009.
The main developer DMCC said 57 towers in JLT had been finished, with another 10 in the final stages.
The development of each tower in JLT came down to individual developers and was not under the control of the master developer, which sold plots to developers, a DMCC spokesman said.