In a report broadcast last night in the UK, Channel 4 News spoke to unhappy British investors with property developer Damac who have yet to see a return on their money in the Dubai market.
While some wanted quick returns, others simply wanted an apartment in the sun – not least David Hunter of Oxfordshire who said he had handed over £60,000, so far, for an apartment at Damac’s Lotus development.
Hunter said a Damac representative told him at the time (February 2007of purchase that construction on the development had already started.
Three months later Hunter found out otherwise when it emerged that the plot was occupied by a UNICEF building. Hunter not surprisingly said he ‘should have been told’.
Citing documents, Channel 4 claimed Damac had been selling developments off-plan without having title to the land in the first place – a practice outlawed by the Dubai Government last August.
Another document, dated from ‘late last year’ alleged that almost one quarter of the firm’s projects had been put on hold.
Meanwhile, a Harrow NW London resident who bought off-plan in the Flamingo Heights development 18 months ago, told the broadcaster he had paid three instalments totalling £70,000.
”I asked them in writing what the current state (of the development) was before I made my investment. I was assured that the foundations had been laid and construction was well under way at the site.”
With the Flamingo Heights development showing no evidence of construction when Channel 4 recently visited it Ludmila Yamalova of Al Sayyah Legal Consultants – to whom Channel 4 took the investor’s complaint – said he may have a case as a statement claiming foundations that had been laid when in fact they hadn’t, could amount to misrepresentation.
Erik Pekarski, former VP Customer Relations at Damac said the line being put out to customers was that ‘progress is ongoing, development is ongoing and construction is ongoing’.
Customers would continue to scream and yell at you as they should, because they had been put off for months, he added.
Damac has, in some cases, since offered alternative flats either complete, or near completion. However, many investors Channel 4 spoke to said they wanted their money back but, like the Harrow investor, had been informed by Damac that there is a ‘no refund’ policy.
When asked about the ‘no refund’ policy an unnamed former manager at Damac said the company took a tough line. David Hunter meanwhile says he has hired a lawyer.
In a statement to Channel 4 News the company confirmed it didn’t have a refund policy, except within ‘the provisions of the regulatory framework’.
It also denied any allegations of wrongdoing and said investors interviewed by the broadcaster were ‘not a representative group’. The company added that it had no intention or policy to mislead customers.
Addressing the allegation that the company had claimed foundations had been laid at the Flamingo Heights development when in fact they hadn’t Damac said: ”It is possible to have a rogue element who communicated information which was inaccurate and not endorsed.”
It added that the Flamingo Heights project tender is due to go out shortly.
