Legal issues delaying sale of Ritz Carlton

Legal complexities are delaying Union Properties from closing its sale deal for Ritz Carlton hotel in Dubai International Financial Centre (DIFC), the company chairman told Emirates 24|7.

“Although we have reached an agreement with an investor on the price, certain legal issues are now delaying completion of the deal,” Khalid bin Kalban said in a telephone interview.

“We have to coordinate with seven to eight parties, such as the contractors, Dubai Financial Services Authority and that is taking time.”
Kalban did not give any timeframe by when the deal will be closed.

The hotel’s sale is part of company’s plans to offload assets and raise cash to pay debts and finish projects.
“We are a property company… we build and sell. That is our business,” Kalban added.

According to Ritz Carlton website, the hotel is accepting reservations for arrivals January 1, 2011 and beyond.

Ritz Carlton DIFC will have 341 guestrooms and suites including two suites, 124 serviced apartments, a signature Thai fine-dining restaurant, a French brasserie, a steakhouse and a lobby lounge.

In August, Union Properties said its second-quarter loss widened to Dh349.38 million from Dh227.95 million a year ago.  The loss was mainly because the company wrote down the value of property amid falling real-estate prices in Dubai.

The developer has already halted development work on some of its projects including the $460 million F1-X, a Formula One theme park in the MotorCity development, following the global financial crisis.