A Kuwaiti company is promising annual returns of 10 percent to investors in Dubai's second buy-to-let hotel development.
By Soren Billing
A Kuwaiti company is promising annual returns of 10 percent to investors in Dubai’s second buy-to-let hotel development during the hotel’s first five years of operation.
IFA Hotels and Resorts said on Sunday it was targeting investors wishing to combine guaranteed rental returns and with a hassle-free vacation property for its five-star Fairmont Palm Jumeirah hotel.
“As the first company to introduce the concept of hotel condominium ownership to the Middle East, we have seen its appeal continue to grow, particularly in markets like Dubai where hotel occupancy is still one of the highest in the world,” said chief operating officer Werner Burger.
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Luxury hotel operator Fairmont Hotels and Resorts will be responsible for the day-to-day administration, marketing, servicing and maintenance of the hotel.
The hotel will include 381 fully furnished rooms and suites with balconies overlooking gardens, pools, the Arabian Gulf and the Dubai Marina.
In 2005 IFA Hotels and Resorts began marketing Dubai’s first buy-to-let hotel development, the Mövenpick Hotel and Residence Laguna Tower, in Jumeirah Lake Towers.
Investors in that project were guaranteed annual returns of 8 percent for the first three years and 30 days complementary use per year.
UAE hotels have been hit by lower tourist spending amid the international recession.
The average daily rate (ADR) for Dubai hotel rooms in September fell by 8.3 percent on the year, the largest drop in the Middle East, to $175.62, according to hospitality research company STR Global.
Shares in IFA Hotels and Resorts are down 17.9 percent in the year to date on the Kuwait Stock Exchange.
GUARANTEED RETURNS: Kuwait's IFA is promising 10 percent annual returns over five years on its Fairmont Palm Jumeirah project.
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Apr 14, 2011 , Malaysia
Sounds really great, except for the fact that it involves a company based in the Arabia. And as eveyone in the WORLD knows, they can change what they promise as if their words and even contracts mean nothing. Actually they don't mean anything. I invest in Malaysia, where I get a measly 8% return...