We are trying to arrange another meeting with EMAAR in order to follow up the points raised at the last meeting. However, EMAAR's decision to sell the Lakes (despite previous denials made at the time the Greens sale was announced) has rather let the cat out of the bag. It is pretty clear now that EMAAR is extremely anxious to liquidate its rental assets with almost immediate effect.
7days - EMAAR at it again
Speculation on the 7days comments is clearly rife, but it is pretty clear that the manner and rapidity of this sale seems to verge on 'panic selling'. Few organizations would embark on such a hurried sale and attract the inevitable bad headlines that result without good reason. The fact that EMAAR would approach the Lakes sale in a similar way after the outcry over the manner of the Greens sale is quite telling. EMAAR, it appears, must sell everything and it must sell now regardless of public opposition, bad headlines or the apparent contradiction with the Dubai Government's stated aims of stabilizing rental prices.
When it comes to precise reasons, it's anyone's guess. Possibly best to avoid the world news if you don't want to scare yourself too much. But whatever it is, it's probably going to happen in March or April judging by EMAAR's short deadlines. By then, it might all make more sense.
Wednesday, February 28, 2007
Thursday, February 22, 2007
EMAAR to sell Lakes too
As predicted here previously, EMAAR appears to be dumping the whole of its rental stock into the market for urgent sale. Lakes tenants of EMAAR are being informed in similar fashion to those of us in the Greens that they have just three weeks to decide to buy, or their homes will be sold from under them.
EMAAR press release
The speed and timing at which EMAAR wants to get rid of its stock of rental properties has obviously raised eyebrows. One can only speculate at the reasons for the almost unbelievable urgency and EMAAR's insistence that everything must go one way or another within a few short weeks. With most of the properties having leases of several months remaining, there seems no obvious reason why a more carefully planned sale could not be phased in at the point each lease is due for renewal.
EMAAR's PR states that with the freehold laws, people prefer to buy rather than rent. But the reaction of tenants in the Greens, and the tiny number who're actually considering buying, suggests otherwise. It seems disingenuous for EMAAR to suggest that their decision to sell is driven by the wishes of tenants, when it's virtually impossible to find a tenant who welcomes the EMAAR decision and hardly any tenants seem to be taking up EMAAR's offer.
Why the desperation to sell now rather than in a few months time? Many market pundits have viewed the oversupply of middle and high-end property in Dubai that will emerge in 2007 as a possible turning point for prices, but any declines are likely to be drawn out affairs, so that alone does not seem to explain the sense of urgency.
So, on the face of it there doesn't seem to be any particular reason for the urgency to dump the whole rental portfolio into the market in a matter of weeks for a snap sale. Perhaps EMAAR knows something we don't?
EMAAR press release
The speed and timing at which EMAAR wants to get rid of its stock of rental properties has obviously raised eyebrows. One can only speculate at the reasons for the almost unbelievable urgency and EMAAR's insistence that everything must go one way or another within a few short weeks. With most of the properties having leases of several months remaining, there seems no obvious reason why a more carefully planned sale could not be phased in at the point each lease is due for renewal.
EMAAR's PR states that with the freehold laws, people prefer to buy rather than rent. But the reaction of tenants in the Greens, and the tiny number who're actually considering buying, suggests otherwise. It seems disingenuous for EMAAR to suggest that their decision to sell is driven by the wishes of tenants, when it's virtually impossible to find a tenant who welcomes the EMAAR decision and hardly any tenants seem to be taking up EMAAR's offer.
Why the desperation to sell now rather than in a few months time? Many market pundits have viewed the oversupply of middle and high-end property in Dubai that will emerge in 2007 as a possible turning point for prices, but any declines are likely to be drawn out affairs, so that alone does not seem to explain the sense of urgency.
So, on the face of it there doesn't seem to be any particular reason for the urgency to dump the whole rental portfolio into the market in a matter of weeks for a snap sale. Perhaps EMAAR knows something we don't?
Wednesday, February 21, 2007
Initial meeting with EMAAR representatives
We were unable to meet with the managing director of EMAAR today and met with a representative "Jivan D'mello" and Hampton's representative Wahida karama.
Intially they were not willing to compromise on any topic - except that there is a possibility of extending the deadline (but even that they were unable to confirm by how much).
We stressed all our points as follows:
- Extension of time is a must FOR ALL and not on one to one basis. They must revert asap as people are already are chasing for update and must clarify way forward.
Their response was that they cannot confirm anything until they discuss with management but would confirm by tonight - they have since called us and said one week extension confirmed. We have stressed that this is not sufficient and minimum of 2weeks should be considered.
Wahida the Hampton's representative has agreed that she will discuss with management and revert to us by tomorrow if management have accepted 2 weeks extension.
- EMAAR should clarify the law to those tenants who will be faced with new landlords - we suggested that they contact the rent committee in the municipality on behalf of the tenants (since it would cost us 2000 dhs to file a claim) and then issue statement addressing the several scenarios possible - i.e. tenancy expires in one month, tenancy expires in 1year, landlord wants to rent what maximum increase can he impose, landlord wants to move in what increase can he impose etc.
They have responded that they will not state anything on behalf of the municipality as the law might change(!) our response was that they should at least clarify what the law is currently. They have agreed that they will contact the rent committee and circulate if they get a WRITTEN response from them - otherwise they will not state anything formally.
- EMAAR explained that by default our contracts will be renewed by another year - the law states that tenants must be given 12months notice if contract is not to be renewed hence we will get automatic renewal. They will not state this in writing since they don't have it in writing from rent committee. We have requested that they clarify on our behalf from rent committee. As we all know, the law in Dubai is sometime vague in places. It is obviously rather hard for EMAAR to claim tenants won't face huge cost increases or rapid eviction while on the other hand stating that they won't put to us in writing what they believe the law is. How can they be sure tenants will be protected from rapid eviction if they cannot actually confirm the law in writing?
We have pushed them to include a clause in the tenancy agreements which obliges the new landlords to renew tenancy for another year even if they believe that the law states that he has to anyway. They said they will discuss internally and let us know. From a logical standpoint, if they genuinely believe that the law does provide that the landlord renew tenancy for at least another year, then they should have no hesitation explicitly adding this to tenancy contracts for tenants prior to selling the properties, which would safeguard the tenants against a change in the law or some other interpretation of the law to what EMAAR claims to understand. This alone would greatly assist tenants, as well as ensuring that Dubai's vital steps to reduce inflation are kept on track, something that will not happen if the rent cap laws can be easily bypassed. Reducing inflation is critical - some surveys suggest the cost of living in Dubai is increasing by 28% per year, something that will destroy Dubai's competitive business position if tough measures are not taken and enforced. The future prosperity of Dubai should not be sacrificed for short term gain - it is vital that the economy is brought under control and that companies can make long term investments here knowing that the cost base is stable. At present, the biggest deterrent to companies is not just the high level of costs, but the lack of clarity in what costs might rise to this year or next.
- We have requested that they offer tenants who move (after 12months given the above) they offer further assistance e.g. waiving the estate agency commission - they agreed
- We have requested that they contact DIC re disconnection penalities which applies to TV/internet/phone. They have refused saying that this was not their concern
We strongly feel that they can come to some agreement with DIC re the above. If even 100 tenants move from one block to the next and need to reconnect with DIC surely there is a way to come to an agreement so tenants don't have to pay disconnection fees and then reconnection fees!! These are perhaps the least of the expenses but none the less important.
- We have discussed that they should offer those who buy either 20% discount or deduct their total paid rent. They have not agreed to any of these suggestions but will discuss.
In summary all we have received from them is the following:
- extension of deadline by 1 week with possibility of another week
- Contact Rent committee on our behalf and IF THEY RECEIVE ANYTHING IN WRITING they will forward to tenants
- Discuss with management any other concessions for Tenants who wont buy
- Discuss with management further reductions on price to those interest to buy - either 20% discount or deduction of rent
- To arrange another meeting next week to follow up
- To circulate any concessions etc to tenants once above meeting takes place
We understand that some tenants are obviously keen to get a running commentary of efforts, but given time and other constraints this is not necessarily possible. However we are doing our best to post information as and when we have it to keep fellow Greens tenants up to date. We hope that further meetings will take place and that we will get information back and some progress on the points raised above.
Intially they were not willing to compromise on any topic - except that there is a possibility of extending the deadline (but even that they were unable to confirm by how much).
We stressed all our points as follows:
- Extension of time is a must FOR ALL and not on one to one basis. They must revert asap as people are already are chasing for update and must clarify way forward.
Their response was that they cannot confirm anything until they discuss with management but would confirm by tonight - they have since called us and said one week extension confirmed. We have stressed that this is not sufficient and minimum of 2weeks should be considered.
Wahida the Hampton's representative has agreed that she will discuss with management and revert to us by tomorrow if management have accepted 2 weeks extension.
- EMAAR should clarify the law to those tenants who will be faced with new landlords - we suggested that they contact the rent committee in the municipality on behalf of the tenants (since it would cost us 2000 dhs to file a claim) and then issue statement addressing the several scenarios possible - i.e. tenancy expires in one month, tenancy expires in 1year, landlord wants to rent what maximum increase can he impose, landlord wants to move in what increase can he impose etc.
They have responded that they will not state anything on behalf of the municipality as the law might change(!) our response was that they should at least clarify what the law is currently. They have agreed that they will contact the rent committee and circulate if they get a WRITTEN response from them - otherwise they will not state anything formally.
- EMAAR explained that by default our contracts will be renewed by another year - the law states that tenants must be given 12months notice if contract is not to be renewed hence we will get automatic renewal. They will not state this in writing since they don't have it in writing from rent committee. We have requested that they clarify on our behalf from rent committee. As we all know, the law in Dubai is sometime vague in places. It is obviously rather hard for EMAAR to claim tenants won't face huge cost increases or rapid eviction while on the other hand stating that they won't put to us in writing what they believe the law is. How can they be sure tenants will be protected from rapid eviction if they cannot actually confirm the law in writing?
We have pushed them to include a clause in the tenancy agreements which obliges the new landlords to renew tenancy for another year even if they believe that the law states that he has to anyway. They said they will discuss internally and let us know. From a logical standpoint, if they genuinely believe that the law does provide that the landlord renew tenancy for at least another year, then they should have no hesitation explicitly adding this to tenancy contracts for tenants prior to selling the properties, which would safeguard the tenants against a change in the law or some other interpretation of the law to what EMAAR claims to understand. This alone would greatly assist tenants, as well as ensuring that Dubai's vital steps to reduce inflation are kept on track, something that will not happen if the rent cap laws can be easily bypassed. Reducing inflation is critical - some surveys suggest the cost of living in Dubai is increasing by 28% per year, something that will destroy Dubai's competitive business position if tough measures are not taken and enforced. The future prosperity of Dubai should not be sacrificed for short term gain - it is vital that the economy is brought under control and that companies can make long term investments here knowing that the cost base is stable. At present, the biggest deterrent to companies is not just the high level of costs, but the lack of clarity in what costs might rise to this year or next.
- We have requested that they offer tenants who move (after 12months given the above) they offer further assistance e.g. waiving the estate agency commission - they agreed
- We have requested that they contact DIC re disconnection penalities which applies to TV/internet/phone. They have refused saying that this was not their concern
We strongly feel that they can come to some agreement with DIC re the above. If even 100 tenants move from one block to the next and need to reconnect with DIC surely there is a way to come to an agreement so tenants don't have to pay disconnection fees and then reconnection fees!! These are perhaps the least of the expenses but none the less important.
- We have discussed that they should offer those who buy either 20% discount or deduct their total paid rent. They have not agreed to any of these suggestions but will discuss.
In summary all we have received from them is the following:
- extension of deadline by 1 week with possibility of another week
- Contact Rent committee on our behalf and IF THEY RECEIVE ANYTHING IN WRITING they will forward to tenants
- Discuss with management any other concessions for Tenants who wont buy
- Discuss with management further reductions on price to those interest to buy - either 20% discount or deduction of rent
- To arrange another meeting next week to follow up
- To circulate any concessions etc to tenants once above meeting takes place
We understand that some tenants are obviously keen to get a running commentary of efforts, but given time and other constraints this is not necessarily possible. However we are doing our best to post information as and when we have it to keep fellow Greens tenants up to date. We hope that further meetings will take place and that we will get information back and some progress on the points raised above.
Monday, February 19, 2007
Response from EMAAR
The Homeless Tenants group has received contact from EMAAR asking for a meeting to discuss tenants concerns. It's not clear at this stage whether the intention is to offer any material concessions that will help the dire effect that this sale will have on many tenants, or just to further explain EMAAR's position and reasoning. We will of course keep you informed when we have any news.
Thursday, February 15, 2007
No meeting tonight
It was agreed at the last tenants meeting that the group should meet again today, Thursday 15th February, to discuss progress.
At present there is no progress to report. Emaar's PR bods have been busy telling the newspapers that they are offering concessions and sweeteners, but as anyone who has seen the newspapers will realise, they are offering nothing more than was originally suggested and nothing that eases the plight of the affected tenants.
We still hope that the letters to prominent and influential local figures will yield results. But as yet, there appears to be no change in Emaar's position that it wants to sell all the affected apartments by the end of February at current market prices.
It appears too that there are also plans to sell off other Emaar leased properties in the Lakes in a similar fashion once the Greens tenants' homes have been dispatched. So this story may well have implications for far more people than it currently appears to affect.
We will post more news when available.
At present there is no progress to report. Emaar's PR bods have been busy telling the newspapers that they are offering concessions and sweeteners, but as anyone who has seen the newspapers will realise, they are offering nothing more than was originally suggested and nothing that eases the plight of the affected tenants.
We still hope that the letters to prominent and influential local figures will yield results. But as yet, there appears to be no change in Emaar's position that it wants to sell all the affected apartments by the end of February at current market prices.
It appears too that there are also plans to sell off other Emaar leased properties in the Lakes in a similar fashion once the Greens tenants' homes have been dispatched. So this story may well have implications for far more people than it currently appears to affect.
We will post more news when available.
Wednesday, February 14, 2007
Background on the newspaper articles
Some tenants have contacted us commenting that the newspaper articles do not represent their concerns adequately and only focus on the ridiculous two week timeframe offered by Emaar.
Rest assured that the focus of our comments and representations to the media have been to highlight the plight of the majority of tenants who cannot afford to buy. But we cannot write the articles for the newspapers.
The press in this country has to operate within certain conditions as we all know. Emaar is a rich, powerful entity with close links to the government. It is clear from talking to journalists that their editors are not happy to highlight the problems tenants face and the massive rent increases when this would put them in conflict with a powerful vested interest in the country.
The tenants letters have been sent with our representations. We will try to publish these shortly here, so that everyone can see the content. Please tell your friends to visit this site if they wish to receive the tenants point of view, as the newspapers' hands are very much tied as to what they can report, so you're likely to just get EMAAR's lame public relations shill.
We must all exist that within the framework of the laws of the land. Events such as this highlight the differences between how things work in many of our home countries and how they work in Dubai. We must all make our own decisions as to whether a place that operates like this is a good long term place to live; whether it is a safe place to invest and a safe place to do business, when powerful organizations can make snap decisions that turn our lives upside down, and where the press tread carefully to avoid upsetting them.
Many of us still feel that we have a future in Dubai, but for many this will convince them that the place no longer offers the better life that they hoped for. In the end, we can only voice our concerns, but we cannot force change. Ultimately we are all here by choice and we are all free to leave. Increasingly many will decide or be forced to. Emaar can exercise control over the local papers, but it cannot exert such influence over the press abroad, and it cannot prevent those who leave from passing on their experiences of how things work in Dubai to the people back home.
Much as these actions by Emaar at present only affect tenants renting, they highlight the differences between what is considered reasonable in Dubai and what is considered reasonable in many other advanced nations. Such a contrast is something that will undoubtedly be of concern to those who might be considering investment or property purchases, as well as those choosing to move to Dubai with the intention to rent.
Rest assured that the focus of our comments and representations to the media have been to highlight the plight of the majority of tenants who cannot afford to buy. But we cannot write the articles for the newspapers.
The press in this country has to operate within certain conditions as we all know. Emaar is a rich, powerful entity with close links to the government. It is clear from talking to journalists that their editors are not happy to highlight the problems tenants face and the massive rent increases when this would put them in conflict with a powerful vested interest in the country.
The tenants letters have been sent with our representations. We will try to publish these shortly here, so that everyone can see the content. Please tell your friends to visit this site if they wish to receive the tenants point of view, as the newspapers' hands are very much tied as to what they can report, so you're likely to just get EMAAR's lame public relations shill.
We must all exist that within the framework of the laws of the land. Events such as this highlight the differences between how things work in many of our home countries and how they work in Dubai. We must all make our own decisions as to whether a place that operates like this is a good long term place to live; whether it is a safe place to invest and a safe place to do business, when powerful organizations can make snap decisions that turn our lives upside down, and where the press tread carefully to avoid upsetting them.
Many of us still feel that we have a future in Dubai, but for many this will convince them that the place no longer offers the better life that they hoped for. In the end, we can only voice our concerns, but we cannot force change. Ultimately we are all here by choice and we are all free to leave. Increasingly many will decide or be forced to. Emaar can exercise control over the local papers, but it cannot exert such influence over the press abroad, and it cannot prevent those who leave from passing on their experiences of how things work in Dubai to the people back home.
Much as these actions by Emaar at present only affect tenants renting, they highlight the differences between what is considered reasonable in Dubai and what is considered reasonable in many other advanced nations. Such a contrast is something that will undoubtedly be of concern to those who might be considering investment or property purchases, as well as those choosing to move to Dubai with the intention to rent.
Tuesday, February 13, 2007
Emirates Today and Adrian Murphy's sorry maths skills
Greens residents were probably amused to read the Emirates Today article from a journalist who among other things clearly has trouble counting without using his fingers.
Adrian Murphy's article laughably suggested that the meeting had just 60 tenants, while 7days got it about right with 200.
In tomorrow's Emirates Today, perhaps Adrian Murphy will explain how a meeting of 60 tenants contributed over 100 signatures to accompany the letters being sent on the tenants behalf?
Given his previous work, it seems pretty clear he's probably just following editorial orders so let's not give too much of a hard time.
Adrian Murphy's article laughably suggested that the meeting had just 60 tenants, while 7days got it about right with 200.
In tomorrow's Emirates Today, perhaps Adrian Murphy will explain how a meeting of 60 tenants contributed over 100 signatures to accompany the letters being sent on the tenants behalf?
Given his previous work, it seems pretty clear he's probably just following editorial orders so let's not give too much of a hard time.
The meeting at the Greens
Thank you to everyone who attended the 'Meet your neighbours' get together at Al Ghozlan a few hours ago. We appreciated the suggestions given and have tried to ensure that we cover the interests of all residents, both those that wish to remain as tenants and those that would consider the offer to buy.
Those we spoke to who had experience of the Rent Committee and the government of Dubai made clear to us that the leaders of this Emirate genuinely care deeply about the lives of the expatriates who come here to live and work. One gentleman had taken matters to the Rent Committee on several occasions and received judgement in his favour every time. The measures taken by the government, under the leadership of His Highness Shaikh Mohammad Bin Rashid Al Makhtoum, Vice President, Prime Minister of the UAE and Ruler of Dubai, are making a real and significant contribution to protecting tenants and ensuring the continued competitiveness of the Dubai economy. They prove that our leaders do care and have taken active measures to address the problems faced by Dubai residents.
We hope that our suggestions will be seen as reasonable and constructive and that given time, an outcome will be achieved which is in the interests of all the parties involved.
Thanks again for your support. We will keep you informed of any developments.
Those we spoke to who had experience of the Rent Committee and the government of Dubai made clear to us that the leaders of this Emirate genuinely care deeply about the lives of the expatriates who come here to live and work. One gentleman had taken matters to the Rent Committee on several occasions and received judgement in his favour every time. The measures taken by the government, under the leadership of His Highness Shaikh Mohammad Bin Rashid Al Makhtoum, Vice President, Prime Minister of the UAE and Ruler of Dubai, are making a real and significant contribution to protecting tenants and ensuring the continued competitiveness of the Dubai economy. They prove that our leaders do care and have taken active measures to address the problems faced by Dubai residents.
We hope that our suggestions will be seen as reasonable and constructive and that given time, an outcome will be achieved which is in the interests of all the parties involved.
Thanks again for your support. We will keep you informed of any developments.
Sunday, February 11, 2007
EMAAR proposes to sell your home – Take action before its too late!
An open letter to the affected residents of the Greens, from a group of fellow residents
No mercy from Emaar
It appears Emaar is bent on a quick sale, with no exceptions for any reason.
One of the tenants affected by Emaar's decision to sell Greens apartments wrote to Hamptons to request more time to deal with the issue. He is returning to the UK for 10 days to attend his grandfather's funeral and spend some time with his father who is awaiting results from doctors as to whether his lymphoma has returned.
Mahmoud AL Omari from Hamptons response:
I am sorry to hear that from you, I regret to inform you that Emaar giving us a period of 2 weeks only, then it will be sold on the market outside, we are only agents for Emaar, and we can't keep this apartment on hold for a long time, so please if you are interested in buying it please contact me ASAP.
One of the tenants affected by Emaar's decision to sell Greens apartments wrote to Hamptons to request more time to deal with the issue. He is returning to the UK for 10 days to attend his grandfather's funeral and spend some time with his father who is awaiting results from doctors as to whether his lymphoma has returned.
Mahmoud AL Omari from Hamptons response:
I am sorry to hear that from you, I regret to inform you that Emaar giving us a period of 2 weeks only, then it will be sold on the market outside, we are only agents for Emaar, and we can't keep this apartment on hold for a long time, so please if you are interested in buying it please contact me ASAP.
Saturday, February 10, 2007
Homeless Tenants
On 8th February 2007, Hamptons (who recently took over as leasing agents for several Emaar rented blocks in the Greens) sent a letter to tenants, the content of which was as follows:
Dear [name]
Subject: Purchase Opportunity of your leased home!
I trust you are well!
Thank you for your residency within [name of block and apartment number] over the last few months/years - I hope you have had an enjoyable tenancy.
Recognizing your support for Emaar over the past and as a very valued resident, we are delighted to announce that Emaar is giving you the first option to purchase the unit in response to several requests from our tenants to buy their homes. As a resident of The Greens, we would like you to be among the first to be informed of Emaar's decision to sell a certain number of residential units, one of which is currently leased to you.
The unit [apartment block and unit number] is offered at [price]
We are aware how important this decision is for you, and in order to assist you in making your dream come true in purchasing your dream house, Hamptons has arranged pre-approved mortgages through Amlak. In order to purchase the property by the present tenant, Amlak is working on a proposal and we can provide the same within three to four days.
Amlak is also offering 97% Mortgage at 8.25%, with an initial AED 5,000 as application fee, and 1% processing fee of the finance amount maximum at AED 20,000. (More details attached herewith) In addition to this offer Amlak is working on a proposal that will be available within the next few days.
As Emaar have instructed us to ensure sales are completed swiftly, we will require your feedback within the next two weeks of your decision. We have been requested by Emaar to advise you that in the event that you choose not to purchase the property, it will be offered for sale on the open market, subject of course to your ongoing tenancy agreement, which will be transferred to the new owner.
In addition, the service fees of AED 7.85/sq.ft should be fully paid in advance for 2007 for the period from 1 march 2007 to 31 December 2007 as per Emaar sales standard procedure.
Should you wish to discuss the matter further or obtain more clarifications, please do not hesitate to contact me on the numbers mentioned below.
Yours truly,
Mahmoud A. Al Omari
Leasing Executive
Some initial discussions between a group of affected residents suggest that few if any can afford to buy (or they would have bought on the open market already), and all are concerned about transfer of their leases to private landlords. None regard this as a welcome 'opportunity'. Instead, residents who cannot or do not buy will be forced our of their apartments by the new owners, or forced to accept rent rises of 50-60%.
The affected residents were not consulted about the proposed sale; the first notification all received was a hand delivered letter informing them to confirm within TWO WEEKS that they would buy their properties, or their properties would be sold off on the open market.
Just a few weeks back, the property leasing agents had written to residents to inform them that the proposed 15% rent increases for 2007 would not take place due to the Dubai government's rent cap law. It seems this may have some connection to Emaar's decision to opt for a quick sale of the affected leased properties. The peace of mind that the 0% rent increase gave to residents has been shortlived, as they are now faced with cost increases of 50-60% instead of the original 15%. Was this really what the Dubai government, which holds 30% of Emaar, intended when it issued the rent cap law to protect tenants and ensure that the cost base in Dubai remains competitive?
The residents trust that Emaar will appreciate and understand the hardship and suffering that its hasty decision to sell causes, and will re-evalute its decision in the context of the widely applauded desire of the Dubai government to protect tenants from massive cost increases and stabilize the cost of living in the Emirate.
Dear [name]
Subject: Purchase Opportunity of your leased home!
I trust you are well!
Thank you for your residency within [name of block and apartment number] over the last few months/years - I hope you have had an enjoyable tenancy.
Recognizing your support for Emaar over the past and as a very valued resident, we are delighted to announce that Emaar is giving you the first option to purchase the unit in response to several requests from our tenants to buy their homes. As a resident of The Greens, we would like you to be among the first to be informed of Emaar's decision to sell a certain number of residential units, one of which is currently leased to you.
The unit [apartment block and unit number] is offered at [price]
We are aware how important this decision is for you, and in order to assist you in making your dream come true in purchasing your dream house, Hamptons has arranged pre-approved mortgages through Amlak. In order to purchase the property by the present tenant, Amlak is working on a proposal and we can provide the same within three to four days.
Amlak is also offering 97% Mortgage at 8.25%, with an initial AED 5,000 as application fee, and 1% processing fee of the finance amount maximum at AED 20,000. (More details attached herewith) In addition to this offer Amlak is working on a proposal that will be available within the next few days.
As Emaar have instructed us to ensure sales are completed swiftly, we will require your feedback within the next two weeks of your decision. We have been requested by Emaar to advise you that in the event that you choose not to purchase the property, it will be offered for sale on the open market, subject of course to your ongoing tenancy agreement, which will be transferred to the new owner.
In addition, the service fees of AED 7.85/sq.ft should be fully paid in advance for 2007 for the period from 1 march 2007 to 31 December 2007 as per Emaar sales standard procedure.
Should you wish to discuss the matter further or obtain more clarifications, please do not hesitate to contact me on the numbers mentioned below.
Yours truly,
Mahmoud A. Al Omari
Leasing Executive
Some initial discussions between a group of affected residents suggest that few if any can afford to buy (or they would have bought on the open market already), and all are concerned about transfer of their leases to private landlords. None regard this as a welcome 'opportunity'. Instead, residents who cannot or do not buy will be forced our of their apartments by the new owners, or forced to accept rent rises of 50-60%.
The affected residents were not consulted about the proposed sale; the first notification all received was a hand delivered letter informing them to confirm within TWO WEEKS that they would buy their properties, or their properties would be sold off on the open market.
Just a few weeks back, the property leasing agents had written to residents to inform them that the proposed 15% rent increases for 2007 would not take place due to the Dubai government's rent cap law. It seems this may have some connection to Emaar's decision to opt for a quick sale of the affected leased properties. The peace of mind that the 0% rent increase gave to residents has been shortlived, as they are now faced with cost increases of 50-60% instead of the original 15%. Was this really what the Dubai government, which holds 30% of Emaar, intended when it issued the rent cap law to protect tenants and ensure that the cost base in Dubai remains competitive?
The residents trust that Emaar will appreciate and understand the hardship and suffering that its hasty decision to sell causes, and will re-evalute its decision in the context of the widely applauded desire of the Dubai government to protect tenants from massive cost increases and stabilize the cost of living in the Emirate.
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