RAK duo mulls La Hoya Bay rescue plan
Ras Al Kaimah, February 1, 2010
Ras Al Khaimah Investment Authority (Rakia), the owner of Al Marjan Island project and its master developer Rakeen Development (Rakeen) said they were working on an adequate rescue plan for the La Hoya Bay project and its investors.
Mandated by court of Ras Al Khaimah, the duo said they were determined to find solutions in the best interest of over 700 concerned investors.
The La Hoya Bay project is one of the major real estate developments behind the success of Ras Al Khaimah as an investment destination and business hub.
In 2006, Frank Khoie, chairman and CEO of Khoie Properties, approached Rakia to purchase several plots on Al Marjan Island in order to develop its own project La Hoya Bay, which included different parts among which was the La Hoya Residence, the companies said.
Upon Khoie’s representations, several sale agreements were entered into by Rakia and Khoie Properties.
Thereafter, Khoie Properties begun to sell off-plan units on all of the proposed plots of La Hoya Bay Project, despite the fact that he had only paid for one plot designated for the La Hoya Residence, and received payments in hundreds of millions of Dirhams from numerous investors all over the world.
'Khoie Properties was unable to make good of its obligations with Rakia, as neither its payments due in 2006 (Dh13.7 million), 2007 (Dh91.9 million), 2008 (Dh84.05 million) and 2009 (Dh40.32 million) were effected nor its guarantee cheques dated 1/12/2008 (Dh57 million), 1/6/2009 (Dh57 million) and 1/12/2009 (Dh57 million) were honoured, whereby 3 cheques issued by Khoie were dishonoured due to insufficiency of funds,' the duo said.
Rakia then filed a criminal case for bounced cheque against Frank Khoei before the courts of Ras Al Khaimah, which in June 2009 sentenced him to 3 years imprisonment.
Two months later RAK Court appointed Rakeen as the judicial custodian of Khoie Properties until completion of La Hoya Bay.
One of Rakeen’s first act as custodian of La Hoya Bay was the opening of an escrow account for the further payments to be received.
According to Rakia, Khoie Properties’ default was not only limited to its obligation to the company.
Rakia has entertained and keeps continuously entertaining complaints and requests for assistance from investors and suppliers of Khoie Properties, said its top official.
“Our sole intention is to protect the rights of La Hoya Bay’s investors and act in the best interest of the sustainable development of Al Marjan Island, RAK and its community. We believe that La Hoya Bay is a beautiful project which will add value to the Emirate’s living atmosphere,' said Dr Khater Massaad, CEO of Rakia.
'Once we have a clear status-quo of where we stand, we will be in the position to define the right strategy. The investors need and deserve full transparency and a clear understanding of the facts and of what can be done. For this purpose, officials from Rakia and Rakeen will visit London (wherein the majority of the investors are based) to visit and discuss this matter with a group of La Hoya Bay investors,' Dr Massad said.
In close partnership and co-ordination with the investors, Rakia and Rakeen are confident that La Hoya Bay can be turned into the success story it promises to be. They have further submitted to the Court a full action plan of the different scenarios which might be adopted to continue developing the project.
Wahid Attalla, Rakeen board member, said, 'For more than one year now since the detention of Frank Khoie, we have been in constant contact with the concerned investors as well as with suppliers and other parties complaining about outstanding payments from Khoie Properties.'
'Our main interest has been to reassure La Hoya Bay’s investors that they are not alone in this situation and that we will be finding a way to help them.'
'After the initial feeling of being betrayed by Khoie Properties when they learned about Khoie’s bounced cheque sentence to 3 years of jail with other cases still under way, they have gained trust again and feel that with strong partners like Rakia and Rakeen a way out can be found,' Attalla added.-TradeArabia News Service
More Construction & Real Estate Stories
- Plaza Premium wins Abu Dhabi Airports contract
- Engineering experts attend Autodesk conference
- Dubai $114m freehold property in big demand
- Heavy Equipment enters Qatar market
- Bahrain market to get $15.8m facelift
- Jacky’s unveils new 3D printers
- Technip wins $400m Kuwait PMC contract
- Arab investors eyeing Turkish property
- Arabtec denies Drake merger speculation
- Saudi's ACWA signs $472m sukuk financing