DUBAI // Hundreds of apartment buildings in Dubai are facing a shortage of maintenance cash because property owners have failed to pay service fees. The full extent of the default rate, which has reached 75 per cent in some developments, is only now coming to light as developers hand over building management responsibilities to homeowner associations under the recently enacted strata law.
It means that the new homeowner groups could be saddled with debt as soon as they start taking over the management of their buildings. For example, to replace a basic chiller in a tower building costs up to Dh3 million - and if there is no reserve fund in place because of service charge defaults, owners would have to foot the entire bill when the work was done. "Service fee arrears is a big issue in many buildings," said Gary Bugden, the executive chairman of PRDnationwide, a property services company. "A lot of people just aren't paying."
The amount paid in service fees has been a bone of contention for residents in some developments, where property prices have fallen by as much as half since the end of 2008. Service fees surged during the boom years, with some developers charging up to Dh21.85 a square foot in annual fees, or more than Dh20,000 for a typical one-bedroom flat. Property owners started refusing to pay, either for services they felt were not provided or shared amenities that were poorly maintained.
But those who have been paying are now concerned about the upkeep of their homes. Michael Aldendorff, who owns a one-bedroom apartments at Nakheel's Discovery Gardens, said: "Owners currently in the building need to pay only their share, nothing says we need to pick up the tab for those who don't pay, which means maintenance will fall by the wayside." Although the strata law was decreed in 2007, it was enacted only in May, so until then developers had full control over building management and collecting service fees.
Kareem Derbas, a partner and chief executive of Cayan Developments, said only 20 per cent of owners at the four residential towers the company built in Dubai Marina paid their fees within the first month of receiving a bill, and four months later only 50 per cent had paid. "The major problem has been with collecting service charges as we don't have direct legal recourse if someone does not pay," he said.
But homeowner associations, once they are set up, will have the power to recover service fee arrears. Under the Strata Law, they will have the right to seek an order from the Dubai Court to sell the properties of those who have defaulted. Developers have until November to hand over complete control to the associations. Jeremy Walter Scott, a senior associate at the law firm Al Tamimi and Company, said: "Part of the problem with people not paying service charges is that there's been no mandated process and it's been developers just serving notices with no accounts or anything on purchases.
"Once the association is in existence it will have the power to use enforcement procedures to issue the enforcement notices and recover service charges. There are quite clear procedures laid down which ultimately could lead to the sale of the defaulting unit." However, while property owners will now have control over how much they pay in service fees, their major concern is collecting arrears and subsequently being able to keep properties fully maintained.
Mr Aldendorff said: "How many owners have disappeared or are just not paying? And how viable is it to put a property on the market in an economy where nobody is buying? The legal process is so lengthy, we won't be able to immediately recover the money." He added that dealing with non-payers was still a grey area that would need to be addressed as the transition towards homeowner associations progresses.
The Written World: How Literature Shaped History
Martin Puchner
Granta
hall of shame
SUNDERLAND 2002-03
No one has ended a Premier League season quite like Sunderland. They lost each of their final 15 games, taking no points after January. They ended up with 19 in total, sacking managers Peter Reid and Howard Wilkinson and losing 3-1 to Charlton when they scored three own goals in eight minutes.
SUNDERLAND 2005-06
Until Derby came along, Sunderland’s total of 15 points was the Premier League’s record low. They made it until May and their final home game before winning at the Stadium of Light while they lost a joint record 29 of their 38 league games.
HUDDERSFIELD 2018-19
Joined Derby as the only team to be relegated in March. No striker scored until January, while only two players got more assists than goalkeeper Jonas Lossl. The mid-season appointment Jan Siewert was to end his time as Huddersfield manager with a 5.3 per cent win rate.
ASTON VILLA 2015-16
Perhaps the most inexplicably bad season, considering they signed Idrissa Gueye and Adama Traore and still only got 17 points. Villa won their first league game, but none of the next 19. They ended an abominable campaign by taking one point from the last 39 available.
FULHAM 2018-19
Terrible in different ways. Fulham’s total of 26 points is not among the lowest ever but they contrived to get relegated after spending over £100 million (Dh457m) in the transfer market. Much of it went on defenders but they only kept two clean sheets in their first 33 games.
LA LIGA: Sporting Gijon, 13 points in 1997-98.
BUNDESLIGA: Tasmania Berlin, 10 points in 1965-66
WWE Evolution results
- Trish Stratus and Lita beat Alicia Fox and Mickie James in a tag match
- Nia Jax won a battle royal, eliminating Ember Moon last to win
- Toni Storm beat Io Shirai to win the Mae Young Classic
- Natalya, Sasha Banks and Bayley beat The Riott Squad in a six-woman tag match
- Shayna Baszler won the NXT Women’s title by defeating Kairi Sane
- Becky Lynch retained the SmackDown Women’s Championship against Charlotte Flair in a Last Woman Standing match
- Ronda Rousey retained the Raw Women’s title by beating Nikki Bella
The rules on fostering in the UAE
A foster couple or family must:
- be Muslim, Emirati and be residing in the UAE
- not be younger than 25 years old
- not have been convicted of offences or crimes involving moral turpitude
- be free of infectious diseases or psychological and mental disorders
- have the ability to support its members and the foster child financially
- undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
- A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
COMPANY%20PROFILE
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Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Cryopreservation: A timeline
- Keyhole surgery under general anaesthetic
- Ovarian tissue surgically removed
- Tissue processed in a high-tech facility
- Tissue re-implanted at a time of the patient’s choosing
- Full hormone production regained within 4-6 months
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
The biog
Title: General Practitioner with a speciality in cardiology
Previous jobs: Worked in well-known hospitals Jaslok and Breach Candy in Mumbai, India
Education: Medical degree from the Government Medical College in Nagpur
How it all began: opened his first clinic in Ajman in 1993
Family: a 90-year-old mother, wife and two daughters
Remembers a time when medicines from India were purchased per kilo
The specs
Engine: 4.0-litre flat-six
Torque: 450Nm at 6,100rpm
Transmission: 7-speed PDK auto or 6-speed manual
Fuel economy, combined: 13.8L/100km
On sale: Available to order now