Dubai Holding hotel-real estate group reports $6.4 billion loss for 2009
A real estate and hotel group owned by Dubai’s ruler announced a heavy loss for the year 2009 on Tuesday, less than a week after it’s sister company sought to delay its debt payments.
The loss by Dubai Holding Commercial Operations Group includes major write-offs that reflect the slumping property market in Dubai, where the global downturn has cooled the city-state’s once red-hot growth and left many of its companies mired in debt.
The group said it posted a 23.5 billion dirham ($6.4 billion) loss for last year, including major write-offs that highlight weaker property demand, falling prices and delays in finishing projects. Without the write-offs, it said the net loss was 1 billion dirhams ($270 million.) That compares with a net profit of nearly 10 billion dirhams ($2.7 billion) in 2008.
“The decline in revenues and operating profits reflect the decrease in land sales due to the significant reduction in demand within the real estate market and the re-phased handovers of projects,” said a company statement.
The group is part of a holding company owned by Dubai’s ruler, Sheik Mohammed bin Rashid Al Maktoum. It includes three real estate companies and the luxury hotel operator Jumeirah Group.
On Thursday, the company’s investment wing, Dubai International Capital, said it was seeking to delay debt payments until Sept. 30.
Also last month, the indebted Dubai World conglomerate said it had won support for its $23.5 billion restructuring plan from leading lenders.