Turkish builder of $200m Gulf-bought chateaux homes is bankrupt
Saudi and Emirati investors were sold Burj Al Babas units by developer Sarot Group
Turkish development firm Sarot Group, which committed to delivering chateaux-style homes within its $200m Burj Al Babas project to Gulf investors, has reportedly filed for bankruptcy. The development in the Mudurnu district of Turkey’s Bolu province features 732 villas, a shopping centre, a hotel, a mosque, and public spaces, and has attracted investors from Saudi Arabia and the UAE.
Citing a debt burden of $27m, Sarot Group applied to an Istanbul court this June to restructure debts with its creditors. At the time, the company was granted three months by the court to implement the exercise, according to Hurriyet Daily News.
Around 350 villas within the project have been purchased by buyers from Bahrain, Kuwait, Saudi Arabia, and the UAE. Construction work has been completed for 587 villas, but “all works have been suspended as of now”, the report states.
Chairman of Sarot Group, Mehmet Emin Yerdelen, said the court has “now decided on bankruptcy” as the firm’s status, calling the move “a wrong decision”.
According to the Hurriyet report, he continued: “We will object to this decision. We still have 250 villas completed and ready to go on sale. Selling only 100 of them would be enough to pay off the debts and complete the project.
“We think that we will overcome the crisis in four or five months. We have been planning to open the premises partly in 2019,” Yerdelen reportedly added.
Hurriyet reported that the architecture of Burj Al Babas’s buildings caused “public outcry on social media, especially because of its contrast with the Ottoman-style historical mansions of Mudurnu”. The town, according to the report, was added to the Unesco World Heritage Tentative List in 2015.