Tameer Towers investors protest by withholding payments

From ArabianBusiness.com 18 June '09
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Disgruntled investors in Tameer Towers are planning to withhold payments for the Abu Dhabi project in protest at, what they claim is, a lack of progress on the AED6bn ($1.64bn) development.

The Tameer Towers Group, which represents around 50 investors with a combined investment of AED 100m in the project, have accused developer Tameer Holding Investment of becoming increasingly aggressive in payment demands for its flagship scheme.

They claim the Dubai-based company has issued threats of cancellations to investors as part of new payment schedules issued without warning.

In a strongly-worded letter the group plans to send to Tameer president Federico Tauber, it says it will “not tolerate the lack of transparency, lack of communication, lack of progress and unreasonable demands of Tameer.”

The new payment schedules, the group says, propose different completion dates of units, with those investors opting to stay on the existing plan facing a delay to completion exceeding that allowed in their contract.

“We believe Tameer is operating in a wholly unfair manner, bullying investors into submission on the basis of the contractual terms and conditions but without acknowledgement of the fact that they've made no progress on site,” one angry investor told Arabian Business.

The letter informs Tauber the group plans to suspend further payment of installments for the project until its concerns were allayed.

In a statement to Arabian Business, Tameer confirmed it was committed to the project, with contractors now working on the development’s sub-structure following completion of the enabling works and foundations.

It said in recent weeks it had issued “lean” payment plans “stretching over the project timeframe” in response to customer requests to pay according to the development of the scheme.

In addition, it said it had decided to waive the penalty clause incurred by investors for late payments.

Tameer said it had assigned a dedicated company representative to communicate with each of its clients.

Tameer Towers Group, which includes doctors, architects, engineers, pilots, directors, lawyers and construction managers, said it was receiving guidance from legal advisors and could take legal action if its anxieties were not addressed.

Uncertainty had surrounded the development of Tameer Towers, which will form the focal point of The Shams district of Reem Island.

It followed comments from a Tameer official in March stating the development was moving ahead but the developer was reviewing the construction programmes and associated costs of its iconic development.

Further confusion about the status of the project arose the same month when Murrary & Roberts Holdings, part of a joint venture in the first phase of the construction of the development, announced to shareholders its contract had been terminated. However, when contacted, Al Habtoor Engineering Enterprises, also part of the venture, said its contract had not been cancelled.

However, following Tauber’s appointment as president, Tameer announced in May it had signed a construction agreement with a joint venture of Al Rajhi Projects and Construction and Al Habtoor Engineering Enterprises for completion of the project, which is scheduled for delivery from December 2011 onwards.

The nine-million square-feet complex features four residential towers, a commercial office tower and a hotel.Tameer Towers Group can be contacted on towers33@hotmail.com