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29 March 2024

Short-term renters guilty for Dubai's Palm Shoreline ruckus

A view of the Shoreline apartments on Palm Jumeirah. (SUPPLIED)

Published
By Parag Deulgaonkar

Short-term leasing is rampant in Palm Shoreline Apartments and these renters are responsible for creating a ruckus when barred from using the pool, gym and beach, a senior Nakheel executive has revealed.

“In Shoreline, you have people doing activities that are not in accordance to the law. People are doing short-term letting out and these people, who lease the apartments, are sold certain services at a certain price. Without knowing what is going on, they get infuriated and confront us when not allowed to access the services,” said Nakheel interim Chief Executive Officer Sanjay Manchanda.

“If the owner has not paid the service charge, how we allow them to access these services,” he questioned.

Manchanda said that none of the owners were doing a legitimate business and not stopping such short-term leasing activity was a disservice to owners living in Shoreline.

Emirates 24l7 reported earlier this month that individual apartment owners, who offer units on short-term lease, should have a licence and must incorporate a company to run such a commercial activity.

Mohammed Shael, Chief Executive Officer, Business Registration and Licensing in Dubai’s Department of Economic Development (DED), said: “Short-term residential rentals is an economic activity. Any individual would like to be involved in this activity but he needs to seek a licence to be able to offer such service. This business activity would require the individual to incorporate a company through Department of Tourism and Commerce Marketing.”

A number of individuals, mainly those owning luxury apartments, have been using various media channels, offering their units on short-term lease at highly discounted prices.

Adverts posted on a community website read: “A luxurious 3 bedrooms apartment on the Palm Jumeirah right side within the Shoreline Apartments for Dh8,500 per week”; while another offered a spacious 2 bed Shoreline Apartments, Right Side Available for Dh5,500 per week.

A 'soft' approach

Manchanda informed that the company had recovered Dh36 million, 50 per cent of the total outstanding from apartment owners, since November 2011 when it barred defaulters from accessing the common facilities.

“What adopted a soft approach to get our dues… had we not done this then I had to continue providing sums of money, which I had borrowed at a cost, to run these communities.”

To a question on whether Nakheel plans to take legal action against “stubborn” Shoreline owners, Manchanda said that they will refer the matter to the Real Estate Regulatory Agency and seek their advice on the issue.

“We have adopted a ‘soft’ approach and it has been working for us. We will continue with it… We don‘t want to put pressure on them [owners],” he said, adding that the company would look at legal options as well if needed.

The interim CEO said that Nakheel was the only developer post-restructuring having no company or interest in providing any service to their communities.

“We are very focused on what we want to do and it is development," he stressed.