20 January, 2010

Nakheel start charging for late Service Charges

Service charges are always a contentious issue and in these tough times it is a cost that hurts even more.

Most of the Service charges we deal with are for Nakheel Asset Management with Tiara being a recent addition.

Nakheel have been particularly laid back at collecting the service charges which i presume is due to the fact that many residents have firstly challenged the amount charged and then knocked the service provided. It is no surprise to me that the services provided are sub standard on the Shorelines when you consider the delinquincy rate of collections. I would guess that over 30% of residents are in the very late payer category and some are owing in excess of 100,000 dirhams. I also think that some of these late payers are the more vociferous ones when attacking the quality of services.

Service charges need paying or quite simply the investment will fall into disrepair and impact on sales values.

We have been told this week that Nakheel will start charging a late payment fee which will go down like a lead balloon but I think necessary.

As a guide here are some latest Service charges for you to compare:

Nakheel Shoreline

Service Charge 14 dhs /sq.ft
Community charge 5.10 dhs/sq.ft
Club house 2.6 dhs / sq.ft

Tiara
Service charge 19 dhs/ sq ft
Community charge 6 dhs/sq/ft

Marina Residence

Service charge total 19 dhs / sq.ft

We can challenge these all we like but service charges are a cost that has to be paid and if we want a decent environment to live where you can charge decent rental rates the charge is unavoidable.

06 January, 2010

Costa v Starbucks

Two cups of coffee in the space of an hour and two totally different views of Dubai.

So, Monday 10 am and I have arranged to meet an investor who I have been chatting on and off with for the past 5 years. I generally prefer Starbucks to Costa so we met at JBR for a change from my usual surroundings.

As we stood in line, waiting to order, I politely asked about the kids with every intent of doing a bit of 'oohing' and 'aahing' about the snowfall in the UK. Not necessary as we were straight into the property game quicker than it takes Emaar to change a name on a Tower.

Its like this Mark . I have sat it out for years and Dubai has been good to me but I just don't feel comfortable anymore with any investment outside of the Palm Jumeirah. Jebel Ali in my opinion is a long long way off ,if ever, and I want out. Quite frankly if it was my development company that owned it, he said, I would dump it.

Slurping away at my piping hot skinny latte I bought a bit of time and feigned burnt lips and wiped away the froth from the side of my mouth whilst I thought of an answer

With his eyes bearing down on me he was only expecting one answer . 'You're right the place is never going to get built and you should run for the hills with 50% of the original price in your back pocket.'

It was early and I really didn't feel like the challenge so I shrugged and said 'we don't call it Wobbly Jelly for nothing'.
I honestly haven't got a clue what will happen but one thing for sure is that there is a very large piece of reclaimed land in Jebel Ali waiting to be developed.

After dodging the bullets my latte had cooled down to a temperature where I could gulp rather than slurp so I made my pleasantries and left. I was now Costa bound on the Palm for another potential lecture in how the world is doomed.

Skinny Cappucino please - who am I kidding? the belt is a full stretch since Xmas. We settled down with our respective drinks and I couldn't beleive my ears. 'Mark, I want to buy in Jebel Ali. I know its a risk and information is limited but you know there is a big piece of reclaimed land out there and one day it will get developed. I want in now'. Not exactly deja vu but i thought someone had spiked my drink.

No point in asking this guy about his kids then!!

This is what it is like at the moment. Everybody has a view on the state of the economy and in this emerging market we call Dubai there are a hell of alot of risk takers living here. For sure there are going to be some more tears but at the same time there are going to be some seriously happy people.

I still prefer Starbucks as a venue but for a coffee with a kick I highly recommend a trip to Costa Coffee on the Palm where I think Nakheel are sponsoring the extra shots.