Damac pays Dh1.2bn for site overlooking extended Dubai Canal

Developer Damac has bought a prime site by the banks of the new Dubai Canal for an estimated Dh1.26 billion. The company said that the site straddles the eastern and western side of Sheikh Zayed at the Safa Park intersection, next to the extended Dubai Canal. It said that the site was bought by its […]

Developer Damac has bought a prime site by the banks of the new Dubai Canal for an estimated Dh1.26 billion.

The company said that the site straddles the eastern and western side of Sheikh Zayed at the Safa Park intersection, next to the extended Dubai Canal.

It said that the site was bought by its subsidiary and would be paid for by way of deferred payment, spread in five payments over the next four years until March 2020.

In a statement to the Dubai Financial Market, Damac said that the site purchases were “in line with the company’s long term strategy of maintaining a five-year land bank and replenishing it with land in prime Dubai locations to ensure a sustainable pipeline of future developments”.

“Further announcements on these development plots will be made in due course.”

The company announced that it was offering investment products that provide a guaranteed return of 3 per cent per year on money put down during the construction phase, and also a “capital guarantee” product that will refund the difference if the value of a property falls below the purchase price within two years of its handover — up until the end of 2019.

Last week, the company reported a 40.6 per cent increase in annual profit to Dh4.5bn, up from Dh3.2bn a year earlier. However, figures were boosted by provisions of Dh155.6m made in the fourth quarter of its prior year accounts and Dh500m worth of penalty charges it reaped from customers who had walked away from off-plan purchases.

Its chairman, Hussain Sajwani, also said the market had entered a “consolidation point” after three prior years of growth.

The Dubai Canal is being built under three separate contract packages by construction firms Gunal, Besix and China State Construction Engineering Corporation. Parsons is the engineering consultant for two of the phases, while CH2M subsidiary Halcrow is handling the third. The work is due to complete by the end of this year.

mfahy@thenational.ae

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Source: Business

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