Desperation in Dubai - Six Flags files chapter 11 and Tiger Woods Dubai “Delayed”
Desperation in Dubai
The tone of the press releases pouring out of the emirate is getting more and more desperate with each passing day. My thinking is that this will only serve to confuse the issue and market even further. Despite the fact that the first property auction in Dubai failed to attract any buyers, the government-owned press release machine keeps pumping them out.
“Luxury property prices stabilize on higher activity!” screams Emirates Business
Prices of luxury properties in Dubai have stabilised with a few projects having witnessed increases of between 20 and 40 per cent since December, realtors said. “We are seeing an increased activity from potential buyers who want to buy into luxury properties since the prices are currently hitting the bottom,” Mohanad Al Wadiya, Managing Director, Harbor Real Estate, told Emirates Business.
Twenty to forty percent increases in prices? Not sure who they think they are kidding, but the other news bouncing around does not look good. Six flags filed for bankruptcy protection yesterday, so their planned multi-billion dollar development in Dubailand looks unlikely to proceed. Despite relatively healthy visitor numbers, the company collapsed under a $2.4 billion mountain of debt.
The Tiger Woods Dubai‚ a multi-million dollar development in the desert with a Tiger Woods-designed golf course has been pushed back to 2010 or even later, amid claims that the real estate element of the project – 22 “palaces”‚ 75 “mansions”‚ 100 “luxury villas” and a high-end hotel – will be delayed indefinitely. Mr Woods was reputedly paid $25 million for the use of his name, so I suspect he is not terribly upset.
Emaar properties, (a Dubai-government owned property developer) share price jumped to a 7-month high last week on the news that they had won a contract to build the “world’s highest tower,” in Jeddah, Saudi Arabia. Bloomberg
I did not even bother reporting that obviously-false piece of information, having it on good authority that this was another attempt to manipulate the stiock markets and create false optimism. Lo and behold, just a few days later, Emaar are now denying any agreement with the Saudis. They are struggling to complete the Burj Dubai as things are, and after $10 billion being injected into the economy by Abu Dhabi, sub-contractors are still going unpaid.
