Dubai: One luxury project in Dubai – the Marina 101 – dropped Dh90 million from its asking price within days… and yet found there are no takers for what was on offer. This even at a time when wealthy investors and cash-heavy institutions are busy picking up upscale properties – residential and commercial – in Dubai.
This is what happened with the Marina 101, a super-tall structure that has been stuck at 97 per cent completion since 2019. On offer at the 426-metre, 101-storey structure in Dubai Marina was the ground plus 32 floors making up the hotel component within it. When the hotel part was first placed for auction, it had set Dh361.45 million as the base rate. Bids were to be submitted by May 27 – but not a single one was placed.
The Marina 101 project, costing about Dh1 billion plus, is in the hands of creditors to the developer, Sheffield Real Estate. India’s Bank of Baroda was the main lender, and had placed the hotel portion for the auction.
Once everyone realized that there were no takers for the Dh361.45 million base rate, the G+32-storey part was again placed for auction at a reduced offer. Again, no takers.
And then came the asking for bids for a base rate of Dh271.08 million, with June 3 as being the final date for submissions. The result? No takers… even though the offer was slashed by Dh90.38 million.
Any investor who might have been interested would have baulked at the still many issues that need to be resolved before Marina 101 gets the final completion certificate from the Dubai Land Department. Plus, there are uncertainties about whether the legal issues, if any, the project and its stakeholders might have against them.
No piecemeal solution
In recent months, the Marina 101 has been back in the limelight – certain investors were willing to take on the full project, get the rest of the project work and fitouts done, and finally see the 16-year development – and property owners in it – get some closure. Due diligence work was reportedly taken up, and there were moves to bring in other investors. Estimates reckon that another Dh50 million or so could finish the construction side of things.
But then came the auction notice putting the hotel part for sale, and, seemingly, without much consultation. “Trying to sell the hotel part alone just doesn’t make sense for a project that’s still facing issues,” said a representative of one of the interested parties in taking on the whole tower. “Why would any investor pick up only the hotel part – all the 33 floors – and then have no clue on the future of the other 67 floors?”
After the Dh271.08 million bid fiasco, the auction was thankfully pulled out. All that it managed was to add to the uncertainties for the hundreds of property owners who bought apartments there, some as recently as 2016-17, in the hope of staying at one of the most prominent addresses in the city. Units cost upwards of Dh1 million at the time.
Need strong intervention
Property owners are saying that only the authorities can try and resolve the issue in a way that benefits all parties. Many have lost faith in the creditors trying to find a solution on their own. “If that was the case, they would never have attempted to sell just the hotel part,” said one property owner at Marina 101.
After the fiasco with the hotel offer, one would have thought some lessons would have been learnt. But last week, an individual apartment at Marina 101 was placed for auction from Dh1.31 million and with June 23 as the final submission date.
None were received… and the bid was pulled. What next?