Investors in the UAE property market have been facing some serious frustrations recently, particularly in the northern emirates of Ajman, Ras Al Khaimah and Umm ul Quwain. Ajman has been a particular destination of choice for many Pakistanis who have been attracted by the cheap off-plan property prices and the promise of a residence visa. Now that some of these projects have completed or are nearing completion, they have discovered that they get a 1 year visa which needs to be renewed EACH year at a cost of AED 1,500 (Rs.33000) and even worse, they may not have any electricity in the hot and humid desert climate for several years !!
Thousands of buildings are being constructed in the United Arab Emirates during the current development boom but they have neglected one serious development issue - ELECTRICITY !! Many brand new buildings that have already been completed, stand in darkness while the owners of the apartments in these buildings stand frustrated. Many moved in furniture and belongings expecting the electricity to be connected with a few days but theey are still waiting months later and it seems that the problem will not go away until 2012 at the earliest.
in Umm al Qaiwain, a Dh30-billion project by the Dubai-based developer Tameer, Al Salam City, was put on hold in May due to the shortage of electricity and water. The delay in such a high-profile project, which was believed to have been 70 per cent sold, was a major blow to the emirate.
Safeer Mall, in RAK, which was completed in June, and has the largest hypermarket in the region, remains empty due to the electricity crisis. A spokesman for the mall said they have lost all hope of solving the problem and businesses are starting to withdraw stock.
In RAK alone, 3,532 building permits have been issued. But up to 2,145 buildings in the emirate are still waiting to be connected with electricity, according to the municipality.
In entire districts of Ajman, brand new high-rise towers, finished to perfection, have stood empty for months. At night, occasional lighting powered by generators highlights the idle buildings.
Developers, unable to persuade the federal or municipal authorities to switch the power on, are watching investments running into millions of dirhams show no sign of producing the expected return.
Ajman has signed a $2bn agreement with the Malaysian power producer MMC to build the Gulf’s first coal-powered electricity plant. The project will not be ready until 2012.
It is unlikely that the energy crisis will be resolved before 2013.
Mr Shaban spent millions on setting up business in the Emirate and is now facing ruin and haveing to return to Egypt with nothing and says others are in comparable predicaments. “Many people bought a flat here. They may have bought it for Dh900,000 and now they have had to sell it for Dh500,000.”
Without power, he says, there can be “no life, no development ... you are nothing”.
“You can expect this to happen in other countries, but not the UAE,” he added. “How will the development of the city be achieved if all the business people leave? People are already saying there is no power in Ajman, so why are they still giving approval for the buildings?”
Many Pakistanis who invested in the property markets of Dubai, Ajman and Ras Al Khaimah are now dumping their properties at below their purchase prices and are trying to take out whatever they can of their investments. Islamabad is experiencing a resurgence in real estate investment as much of this money s being repatriated to the safety of the federal capital of Pakistan.
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