Commodore Contracting enters Dubai Lagoon fray

Delays to the uneven project have angered investors

RELATED STORIES: Top 13 Saudi Arabian construction contractors |  AED1000 charge adds to Dubai Lagoon investor bill | Dubai Lagoon enters final construction phase

Troubled developer Schön Properties has added another construction company to the building of Dubai Lagoon to speed up the completion of the stuttering AED3 billion project.

The company has awarded an AED82.25 million contract to Commodore Contracting LLC for zones 2 and 4, to finish all concrete and block works, double basement, superstructure, water proofing and related works for both zones - a combined built up area of 1,412,648 square feet.

Commodore Contracting joins the project’s existing contractors, Bin Sabt Building Contracting Company, which is working on the more advanced Zone 1, and Belhasa Contracting and Engineering Company (BHECC), which is reputedly on site with an intensified construction program planned for Zone 3.

Actual construction is expected to start within three weeks and the ground floor will be hit by mid-September, according to the schedule set by the contractor.

More than 30 engineers, foremen and executive staff will be working on the project, along with approximately 300 labourers for each of the zones, to ensure the completion by the end of 2012.

The move comes after mounting criticism from investors over delays, in some areas by more than two years. Last month the Schön Properties confirmed that zones 5-7 had stopped completely following sparse buyer interest.

Story continues below

Advertisement

FEATURED COMMENT It would be advisable if the developer makes a priority for the zones to be completed and deliver the units to the custo   1 Comments Read more comments »

Though Zone 1 has all building structures and block works complete, Zones 2 and 4 have completed enabling works, while construction within Zone 3 is only complete up to the second floor slab.

It also follows the launch two weeks ago of a new payment scheme in which investors are due to only make instalments on their prospective purchases after proven completion of different stages – a move Schön Properties claimed would boost transparency. Investors would still have the choice to remain with their existing payment plans, which for some consists of a 50% initial payment and the remaining 50% paid as a seven-year mortgage after completion.

However, investors in zones 5-7 – who will see no more progress on their units for the next year - would be accommodated in Zone 1 only if they switched to the new payment plan, Schön Properties confirmed to CW last month. Sonia Schön, executive director, said the company would prioritise companies that changed their payment method to the new scheme.

Though the company has made an attempt to reach out to investors to switch to the new payment programme – which is approved and will be jointly-monitored by the Real Estate Regulatory Agency – a consortium of investors has become increasingly frustrated. Two years ago the Dubai Lagoon Investment Committee sued the company over the delays to the project.

Last month it was also revealed that investors would be charged AED1,000 for registering their units with the newly-formed Interim Registry. Though some have baulked at this charge, others point out that the project, nor its units, had been registered with land department since work on the project began. This meant that Schön Properties could have sold investors’ apartments and cancelled contracts.

Schön Properties has also recently assigned a relationship manager for each investor.

Khizer H. Schön, executive director of Schön Properties, said: “With the appointment of Commodore Contracting, we are confident that progress on the project will be stepped up significantly. With accelerated mobilisation, construction will proceed on both zones with a one month lag between the two zones.”