ABU DHABI // A group of property buyers say they are struggling financially after they bought flats in Al Reef Downtown without knowing that the existing tenant can stay at current rent rates until 2019.
The buyers said they were sold apartments in three Al Reef buildings between 2014 and last year without being told of an extension clause in a lease agreement between Manazel Specialists Real Estate, the developer, and Rosewood Abu Dhabi hotel, which is using the flats to house its employees.
Buyers said they had hoped to move into the flats in September before a potential three-year extension kicked in, adding they had not received rent and complained of being left in the dark as legal negotiations between Manazel and Rosewood continued.
“We feel cheated. There are more than 100 landlords affected by this situation,” said F M A, a father of three, who bought two flats in October 2014 after taking out a mortgage. With no money from the investment and having to make monthly payments on the loans, F M A said he was in dire straits.
“I recently took out a high-limit credit card to pay my children’s school fees,” he said.
Another buyer, A Z, said he bought a three-bedroom flat last June and had hoped to move in this year with his wife and two children. But that plan is now up in the air.
“It is becoming a real inconvenience, with the insecurity of not knowing what will happen next September,” he said.
A Z said that he should be collecting annual rent of Dh74,000, well below the market rate of Dh130,000 for the same units. But even if he was being paid rent, he would still be suffering losses, he said.
The buyers said that agents from Nationwide Middle East Properties and The Property Shop sold them the units.
A Z said a Nationwide agent had pressured him to sign the sales agreement within 48 hours. “We asked to see the lease agreement, but I was told by the agent that he didn’t have it and not to worry,” he said.
Furthermore, a document from the agent said he would collect Dh100,000 a year in rent, but A Z found out from Rosewood that it was only Dh74,000.
Manazel Specialists said the buyers’ predicaments were “a complex situation with many parties involved”.
“It would therefore be inappropriate for Manazel Specialists to comment on specific matters when active and positive discussions are ongoing to resolve the issue,” it said.
Rosewood Abu Dhabi said its main focus was to look out for its employees.
“While we are facing some of the owners’ objections to the terms and conditions, we are doing everything to maintain the relationship with each one of them,” she said.
An agent from The Property Shop said many colleagues were unaware of the clauses in the tenancy contract.
The Property Shop did not respond to a request for comment. A Nationwide spokesman said their agents acted ethically during the sales process and that the matter was between Manazel and Rosewood.
Another buyer, A J, said he defaulted on his loan for the flat he purchased in late 2014.
“It’s a huge headache. It was supposed to be an investment, but now it’s spoiling our lives,” he said.
“This is affecting the reputation of the real estate market of Abu Dhabi.”
Source: uae news