The false promise of Dubai’s property sector

“I have made peace with the fact that I got scammed out of all my money; but what am I supposed to do now?” So says one South African flight attendant who purchased an apartment in Dubai back in 2006, expressing what hundreds of property investors in the UAE have experienced. His apartment in the Lagoon development project was never built, yet he is now being hounded for defaulting on payments for the non-existent property.

“This is an atrociously common situation,” says Radha Stirling, founder and CEO of Due Process International and Detained in Dubai, “This client should have been living in his promised luxury apartment for the last 14 years – when it was supposed to be completed; instead, he is being pursued by Mashreq Bank for falling behind on payments for a home that never was, and never will be built. The developers, in this case Schon Property, have already received their millions from the bank, but individual buyers are expected to pay that back, even though the Lagoon apartments project, for all intents and purposes, has been scrapped. It does not take two decades to build an apartment complex in Dubai.

“We have clients who have lost their jobs after signing contracts with Schon Properties, struggling to keep up payments using their credit cards, taking out loans, sinking themselves into debt; all in the hopes of eventually owning valuable properties in the heart of Dubai, only to finally realise that they have been utterly defrauded. Clients make payments on these imaginary properties for years under the constant brow-beating by banks like Mashreq threatening that they will be criminally charged and reported to Interpol if they so much as fall behind on their instalments – never mind that the properties turn out to be phantasms.”