Dubai's Habtoor Group launches $3 billion project

Reuters

DUBAI, Oct 7 (Reuters) - Family-owned Dubai conglomerate AlHabtoor Group said on Monday that it was launching a $3 billionreal estate development in the emirate that would include 3,000hotel and residential units as well as a water-themed theatre.

The group, whose operations span the hospitality,construction, education and automotive sectors, said it expectedabout 20,000 people would visit Al Habtoor City every day.

Chairman Khalaf Al Habtoor told reporters that the groupwould use its own resources to finance the project, which wouldbe completed by 2016.

"We are capable of financing this. But if banks areinterested, then we are happy to talk to them."

Developers in Dubai are back to announcing mega-projects asthe emirate recovers from its 2009-2010 debt crisis. Dubai firmshave announced projects worth nearly $40 billion in the firsthalf of 2013, according to some estimates by local media,including plans to construct the world's largest Ferris Wheeland billion-dollar theme parks.

The Habtoor development would run alongside Dubai's newlyannounced canal; the emirate's government said last week that itwould spend $545 million on building a canal through itsdowntown area.

The return of a bullish mood to the real estate market hascaused home prices in the emirate to surge over 22 percent inthe past year, consultants Jones Lang LaSalle said in a reportlast week, raising concerns about an overheating of the market.

Al Habtoor, which has a stake in a joint-ventureconstruction firm with Australia's Leighton Group, shelved plans to raise as much as $1.6 billion in aninitial public offer of shares last year.

The chairman said on Monday that the company had nointention of reviving the IPO plan this year.

Its new development will have three residential tower blocksincorporating 1,460 luxury apartments, and three hotels to beoperated by Starwood Hotels & Resorts, he said. It willhave 11 penthouses including two VIP penthouses with privategarden terraces, a swimming pool and a Jacuzzi.

"We don't have plans to sell the VIP penthouses, but if wedid put them on the market, we would not sell them for less than$250 million each," Khalaf Al Habtoor said in a press statement.

The water-based theatre will bring "a touch of Las Vegas toDubai", the statement added.

The chairman dismissed talk of another property bubbledeveloping in Dubai.

"We can't control speculators. The government can't do muchabout gamblers," he said.

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