For 14 years, Mohammed Azam has been waiting for construction to start on a luxury five-bedroom villa he bought in the largest but least developed area of ​​the famous dubai artificial islands in the shape of a palm in the Persian Gulf. A surprise email from Nakheel PJSC in September confirmed that this would never happen. Dubai’s real estate regulator had apparently decided months earlier to cancel the Palm Jebel Ali project, and the aforementioned government-backed construction company told Azam it would refund less than a quarter of the amount paid for the villa shortly before work began.

Not only the Turkish Cypriot businessman received the relevant information. He is among hundreds of investors who bought palm tree-shaped houses on the island that were never built, according to a related Bloomberg article. Many would-be owners traded their purchase for alternative Nakheel property many years ago. Hundreds of others were compensated for the amount she raised from top investors until she stopped work on the project in 2009, according to interviews with seven investors and documents seen by Bloomberg.

The investors told Bloomberg they are among 400 owners of more than 700 properties in The Palm Jebel Ali Fronds and The Palm Jebel Ali Water Homes, for which Nakheel is recovering around AED850 million ($231.4 million).

Hundreds of investors bought palm tree-shaped houses on the island that were never built.

They also argue that they should be compensated for a delay of more than a decade and a spike in house prices since then. Canceled real estate projects often cause havoc, but in this case it’s happening in one of the most explosive real estate markets in the world. It also raises questions about the legal framework that applies to real estate in Dubai, despite the fact that foreigners have been allowed to buy houses there since 2002.

Real estate firm Nakheel, headed by Mohammed Ibrahim Al Shaybani, chief executive of the emirate’s sovereign wealth fund, stressed that it is giving back what it received from the project’s original investors but cannot do anything if people buy at higher prices. the last twenty years. The company also said it has been offering voluntary refunds for years, as well as an additional bonus amount for new property purchases. “It’s so unfair,” said Mohammed Azam, 44, a father of two and owner of a property management company. “I would have agreed to the whole process if Nakheel went bankrupt in 2009 and then the project was closed. But to do so now that the market has recovered and beach villas are selling for more is simply absurd.”

For history, Nakheel presented two projects The Palm Jebel Ali Fronds and The Palm Jebel Ali Water Homes in 2003. In an advertising brochure, she called the artificial island Palm Jebel Ali the eighth wonder of the world. It will be the size of London Heathrow Airport with 17 palm leaves. Finally, it was intended to house marinas, a theme park, beachfront villas, and thousands of stilt houses inspired by an Arabic poem.