Friday, May 29, 2015

Project Rendering -- Zahra Apartments

First Questions

As investors, these are some of the questions we should be asking:
  1. Are our payments going into an escrow account?
    Yes. Buyers make payments to "Town Square Zahra" account at Noor Bank PJSC, project no. 16553236--recorded at Dubai Land Department's list of approved developers.
  2. Do we have access to the escrow account statements so that we can verify that payments are being deposited and kept there?
    According to Dubai Real Estate Legislation, depositors or their representatives may gain access to their own accounting records and may request copies of such records. (p124)
  3. Which contractors are being appointed?
    response pending
  4. What are the relevant building codes which apply to this development?
    response pending
  5. What are the anticipated maintenance and management fees which owners will be required to pay upon handover and what are the fees based on?
    Fees are expected to be 14 dhs per square foot, not including balconies--as reported to me by an Nshama property advisor.
  6. When making the initial staged payment we were required to make an extra payment at 4% of purchase price for title deed registration. Where then are the deeds? What documentation are we entitled to beyond a payment receipt?
    The Offer to Purchase document refers to this payment as pre registration and/or final registration charges may be levied [or] changed by the Land Department, ERES [Emirates Real Estate Solutions] and/or the Vendor. Further to this, the payment receipt acknowledges these as Land Regestration and Oqood fees.
These are a few questions worth looking into. I welcome any others from other investors.
In addition, in asking whether installments could be paid by credit card, I was told yes with a 2% fee applied.

Updates--above and below in colored font (12 June 2015):
    The escrow account among other functions provides assurance that payments collected from purchasers will be used solely for the Al Zahra project and not for any other Town Square projects. Article 9 of Law No. 8 under Dubai Real Estate Legislation states:
    An Escrow Account will be opened in the name of the project and will be dedicated exclusively to the construction of that Real Estate Development project.

    Thursday, May 28, 2015

    An Unknown Quantity?

    We (as investors) don't really know much about Nshama, do we? But we do know that most of its officers hail from Emaar, perhaps the most respected and successful developer in the UAE, with probably the largest portfolio of completed projects. That bodes well.

    But Nshama is not Emaar. It is a new company with no track record of its own. Town Square is its first project--and a very ambitious one at that, with a planned 3,000 villas and 18,000 apartments.

    As one investor (in a single apartment unit) I suggest other investors join with me in following and monitoring progress on this project--lest completion date roll around and we find delays, construction standards lower than that promised, incomplete or non-existent infrastructure and landscaping, lack of transparency or shifting terms on payment matters, absence or changes in promised amenities, outrageous management fees, etc.

    I propose not waiting until these problems become reality, but keeping a close eye on the development and in communication with the developer out of the start gate.

    We can also share photos, project updates, communications and other information and speak with the developer as a group rather than as lone investors. Please email me if you are an investor or otherwise interested in keeping tabs on this project.