"Hundreds of Irish investors who feared they had lost large sums on Dubai properties that were never built will be offered a new completion deal by an Indian company next week.
The investors are being invited to meetings in Dublin, where they will be briefed on proposals to finish construction on the developments, located in the Sports City area of Dubai.
Up to 1,000 Irish investors are thought to have become involved in the Sports City scheme through Irish agent, Larionovo, which went into liquidation at the start of last year.
The matter has largely been in limbo since then, although 150 investors have mobilised through the Dubai Action Group in an effort to recover some of their investment. Each investor has committed tens of thousands of euro to the project, rising to €400,000 in some cases.
Some investors remortgaged their homes to become involved in the project, located in a 50 million sq ft area designed to house a mixture of commercial, residential and sports facilities.
They learned this week that an Indian group had bought out three of the four developments concerned. The Indian company, Smart Investments, wants to finish construction of the properties and is likely to seek further funds from the Irish investors in this respect.
Some investors paid up front in full for the properties, while some paid a portion of the full price. All the purchases were made from plans. All affected investors are being invited to meet Probir Chatterjee, a representative of Smart Investments, next week.
Mr Chatterjee was previously financial controller of Profile Group, which in turn was the parent of Larionovo. He and a fellow Indian businessman have completed a deal to buy the Eagle Heights, Bermuda Views and Profile Residence developments in Sports City. Larionovo controlled a 25 per cent stake in Profile Residence, and Smart is thought to have agreed a sale of that interest with the agent’s Dublin liquidator, Grant Thornton.
The Dubai Action Group is taking advice from Dublin law firm, Anthony Joyce Co, which has become involved in a number of problematic overseas property cases over recent years.
The firm is also looking at options for investors in a separate Sports World development – Kensington Royale – where construction has been slow and further funds are being sought by the developer, MED.
It is thought a substantial number of Irish investors could be involved, having purchased through British agents.
Next week’s meetings are being held at the Carlton Hotel at Dublin airport. Bermuda Views and Eagle Heights investors are invited to attend at 7pm on Tuesday 8th. Profile Residence investors are meeting on Wednesday at 7pm."
The same story featured on today's Arabian Business Website, written by former Sunday Tribune property reporter, now resident in Dubai, Shane McGinley:
"An Indian company will meet with a group of Irish investors in Dublin on Tuesday in a bid to strike a deal to rescue a number of projects in the Dubai Sports City development, Arabian Business has learnt.
Up to 1,000 Irish investors bought properties in Dubai Sports City through the Dublin-based Larionovo overseas property agency, which ran into financial difficulties and went into liquidation in early 2009.
Around 130 investors, who had each invested a minimum of 75,000 Euro ($89,797.99), set up the Dubai Action Group and attempted to recoup their money from Profile Group, the Dubai-based parent company of Larionovo.
Last week, Probir Chatterjee, the former financial controller of Profile Group, and a number of other Indian businessmen, set up the Innovation Group and took over the Profile Group’s Dubai Sports City projects, which include Eagle Heights, Bermuda Views and Profile Residence.
“The original developer… sold or gave his shareholding to this new Indian company because he either cannot or does not want to build out these units,” Tony Hynes, chairman of the Dubai Action Group, told Arabian Business.
Earlier this week, Chatterjee met with British investors in the developments and he has arranged to meet Irish investors in Dublin on Tuesday and Wednesday, in a bid to persuade them to invest the remainder of the money due in order to complete construction of the units.
“A lot of [Irish investors] have paid 65 percent upfront and I imagine [Chatterjee] needs the 35 percent to finance the building out. So I imagine that is what he is doing here, getting a feeler for who is going to close and who isn’t,” Hynes said.
He added that Chatterjee is aiming to get the finance in place to start construction on the units this month and plans to have them completed within eighteen months.
It is estimated that since 2002 up to 5,000 Irish investors pumped money into developments across Dubai, some of which have now run into difficulty since the onset of the global property downturn in 2008.
‘The simple fact is that too many apartments were being built. It was unsustainable. Investors who got in very early did well if they sold. But most didn’t," said Ronan O’Driscoll, director at the Savills agency in Dublin told the Sunday Business Post newspaper in November last year.
In March 2009, John O’Dolan, one of Ireland's leading building developers and owner of the island of Ireland on The World manmade project off the coast of Dubai took his own life amid rumours of financial worries as a result of the global economic crisis."