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29 March 2024

Tanmiyat revises payment plan for Living Legends project in Dubailand

The Living Legends project at Dubailand has been delayed by nine months, said Tanmiyat. (SUPPLIED)

Published
By Anjana Kumar

Saudi-based developer Tanmiyat has revised the payment plan for its Dh2.7 billion Living Legends project at Dubailand, a senior executive has revealed.

The new plan is in line with Real Estate Regulatory Agency (Rera) guidelines that say developers should collect payments as they reach different stages of the construction processs.

The developer has not collected any payments from customers for the past five months. Details of the new plan are being sent to buyers. "We have obtained approval from Rera for a revised payment plan for our Living Legends projects and we are now approaching our customers to provide them with updates and work closely with them on how to proceed," said Wan Hasni, advisor-in-charge at Tanmiyat.

"We will now be meeting with our customers to provide them with solutions that best suit their needs and agree together on the new payment procedure."

Hasni said the previous payment plan was based on fixed dates and was not linked to construction progress. "Now the more we build, the more payments we collect," he added.

Living Legends is part of the Dh14bn Legends mixed-use entertainment development. An investor from Britain, who wished to remain anonymous, said Tanmiyat had not taken any payments from him since July last year.

"I purchased the property in June 2008, paying a Dh1.1 million premium for a type D prime villa," he said

"The total price including the premium is around Dh3.4m. I paid around 20 per cent on purchase, amounting to around Dh420,000. I paid a further 10 per cent installment in July 2008.

"The next 10 per cent was due in October 2008 but Tanmiyat said it was all right to pay it before the end of 2008. When I went to pay in December 2008, the credit control department informed me that they were not accepting more payments from clients due to Rera's new regulation linking payments from buyers to progress on construction.

"Since December I have had my installment money sitting in a Dubai bank account as I waited for a new payment schedule to be sent to me. I have contacted Tanmiyat on numerous occasions to ask about the new payment schedule and the progress of work but they have not given me any information," said the investor.

In March this year the developer wrote to buyers to tell them the completion of the project had been delayed. The letter said: "While Tanmiyat deeply regrets such a delay we must advise you that the delay is due to circumstances beyond Tanmiyat's control. Despite attempts to mitigate delays by taking all reasonable steps this has not been possible. As a result, Tanmiyat must declare pursuant to Article 13 of the office/sale agreement, an event of force majeure." Hasni said: "We have been making sure that we stopped payment collections and have told our customers not to pay more than they need to, especially with the hardships that are challenging the markets today. Currently we are only asking payment from customers who have paid less than 30 per cent and we are asking them to pay as soon as possible. Overall the collections have been on hold for five months.

"Between now and October 2009 all our customers will receive the new payment plan. We've already started sending details to some of them. Details about the construction progress will also be given. In line with the new Rera law, the new payment plan states that 30 per cent is due from customers upon signing the contract. The balance will be spread out over stages of construction, and the last 20 per cent is to be paid upon delivery."

However, the UK investor said: "My most recent conversation was on the phone with a customer service representative at Tanmiyat 10 days back, who said they were still waiting for Rera's approval for the new payment schedule.

"She said work was in progress but on a small scale and that it would be in full flow after Eid Al Fitr when another 700 or 800 more workers arrived on site. Apparently there are 150 workers on site right now – the same number that were supposedly there when I visited in May.

"I have paid more than Dh2m towards this project and I am very concerned about the delays and the shortage of information from Tanmiyat."

The developer said construction had been delayed by nine months but the scheme was not being put on hold, and work on the initial 307 villas had begun in earnest in May this year. But the investor said: "When I visited the site in May I didn't see any meaningful construction going on."

The project was launched in 2006 and nearly 75 per cent of it has been sold.

Hasni added: "The start of construction was delayed for reasons such as the need to seek new approval for the master plan, which was granted only in early 2008. "We sent out all the required documents very early in the scheduling process but we could not start construction until we had received no-objection certificates from all the government authorities such as the Dubai Municipality, the Roads and Transport Authority, etisalat, du, Dubailand, the Dubai Electricity and Water Authority and Tecom." He said the final certificate was not received until August 7 last year.

"Since the crisis started taking its toll on the region in mid-to-late 2008, the construction industry as a whole has slowed down, and we were affected just like many other real estate companies in the region. Fortunately we were able to recommence construction last May and since then construction has been progressing smoothly."

"Any development project produces responsibilities and risks for both the customers and the developer. We have been doing our part by working out solutions for our customers. With the new easy payment plan and target completion dates we will be working with our customers closely, fairly and properly to help them find solutions that best suit their needs."

He said China State International was co-ordinating work on the infrastructure for Living Legends.

"The infrastructure will be ready in phases as the components of the project are delivered. Most of the infrastructure will be delivered by the time the first phase of the project is complete, which will be in October 2010, and the final component of the project will be delivered by 2013."



The legend so far

Living Legends is the residential section of the Legends development and is located at Dubailand on Emirates Road between Global Village and the Dubai-Al Ain interchange in Nad Al Sheba area.

The project comprises 500 luxury villas, 12 residential buildings, a golf hotel and office towers. The residential buildings will contain a mix of studios, one-, two- and three-bedroom apartments.

The Commercial Legends office towers will form an integrated part of Living Legends.

Legends is a Dh14 billion mixed-use entertainment development project being built in Dubailand. It will occupy 24.7 million sq ft of land along Emirates Road opposite to Global Village.

The project was launched in 2004 by Bahrain-based investment bank, Gulf Finance House and will have three climate-controlled indoor theme parks – Legends of Arabia, Legends of Nature and Legends of the World.

Besides enter?tainment there will be themed hotels, five hotel apartment towers, a nine-hole golf course, an entertainment and shopping area and a business development containing five commercial towers.

 

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