Dubai Holding Commercial Operations Group (DHCOG), a division of Dubai Holding, has reported a AED23.6bn ($6.4bn) loss for 2009, after booking a AED22.5bn impairment charge to the value of its assets following a sharp fall in the emirate’s real estate prices.
The company made a AED1bn loss before accounting for the fall in the value of its assets, compared with 2008 when it made a AED19bn. In 2009 the company’s total revenue was AED9.5bn, compared to AED13.2bn in 2008. Shareholders’ equity fell from AED37.4bn to AED14.6bn.
The company said that in response to the financial crisis “projects in the early stages of development have been either deferred, or suspended, until conditions improve.” It added that it was “committed to seeing commenced projects through to completion.”
The company, however, remained sceptical about an improvement in real estate prices in the emirate anytime soon. “The real estate market is expected to continue to face challenges in 2010 and 2011 until the excess supply of the existing and expected inventory is absorbed by stronger demand.”
The statements show that total financial liabilities on the company is AED35.8bn. It also said that it estimated contractor claims against the company as a result of contract delay’s or terminations could be AED4bn.