Project delays and write-downs hit Dubai-based developer
Nakheel has reported losses of AED13.4bn ($3.6bn) for the first six months of 2009.
The Dubai-based developer’s losses are a result of AED12.22bn of write-downs in the value of the land it holds and projects that have been delayed or scaled back, and AED989m of costs from terminating contracts.
Projects that have been delayed or scaled back include the three palm islands, Dubai Waterfront and The World.
The terminated construction contracts include a AED2.9bn agreement with the local Al-Habtoor Engineering Enterprises and South Africa’s Murray & Roberts Contractors (Middle East) to build the Trump International Hotel & Tower on the Palm Jumeirah.
Nakheel’s revenues for the six months to June 2009 were AED1.97bn, 78 per cent less than the AED9bn reported for the same period in 2008.
Nakheel’s senior management approved the results on 26 November, a day after the Dubai government issued a statement saying Nakheel’s parent company, Dubai World, was going to restructure $26bn of debts. This includes loans held by subsidiaries such as Nakheel and another real estate developer, Limitless.
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