Nakheel has appointed a contractor for its first new development project since Dubai’s property market crashed in late 2008.

The local developer awarded the local Dubai Civil Engineering (DCE) the AED194m ($53m) contract to build the Palma Residences on the Palm Jumeirah in Dubai.

“The launch of this project and the signing ceremony [with DCE] project is a milestone for Nakheel, as it is the first major project we have launched since the restructuring,” says Ali Rashid Lootah, chairman of Nakheel.

DCE’s 18-month contract involves building a gated community comprising 104 town houses on 61,000 square metres of land off the eastern side of the Palm Jumeirah’s trunk. The properties will have four or five bedrooms, and each unit will have private parking for two cars.

The overall cost for the development is expected to total AED227m ($75.41m). Nakheel has also appointed UK-based Halcrow as the consultant for the marine works, which involves profiling the beach. Work on the beach is expected to start during the summer.

The project is the latest sign that clients in Dubai now have the confidence to move ahead with new projects.

“This project is proof that the recovery is on its way,” says Lootah. “We are now selling plots and residences on the Palm. The prices are all higher than pre-crisis levels.”

Nakheel is not the only Dubai-based client moving ahead with projects this year. In March, the local/Australian Al-Habtoor Leighton won the estimated AED1.9bn ($515m) to build the Habtoor Palace hotel development. Major contracts have also been awarded at Jebel Ali port and Dubai International airport.