Project Background
With an uncertain future and the possibility of losing their investment, hundreds of real estate owners are in a desperate search for answers after the Dubai Land Department declared a project initially introduced in 2005, 19 years ago, to be “under cancellation.”
Investor Stories
Bibhu, a citizen of Dubai, has been longing for his ideal house in the Lily Zone at the Dubai Lagoon location in Dubai Investments Park (DIP) for the past 17 years. He invested in the property in 2007 and continues to inquire about the current state of the building at the now-defunct location.
At least 111 purchasers, including Bibhu, eagerly await the project’s conclusion, hoping to receive a reimbursement for his investment or a successful delivery.
Initial Project Launch
Schon Properties launched Dubai Lagoon, which consists of 53 mid-rise structures with 4,166 units that range from studios to apartments with four bedrooms. Early reports cited its developers as among the first to offer a guaranteed completion date — with financial penalties for the new homeowners if it was not met.
Project Timeline and Challenges
The project’s first phase was utterly sold out 54 days after it was launched, according to an announcement made in March 2006. Construction on the first phase was set to be completed by September 2007 and handover by 2008.
However, several issues, including stakeholder conflicts and financial difficulties, prevented the mixed-use development from meeting the deadline.
Developer Intervention
After waiting for the developer to provide them with updates on the status of their properties for years, hundreds of investors were finally given some closure in 2017 when the Dubai Land Department and the Real Estate Regulatory Agency (Rera) stepped in and gave Xanadu Real Estate Development the Lily Zone project to finish. However, investors quickly realized that Xanadu’s promises to finish the project within two to three years were also untrue.
Also Read: What Are the Best Areas to Live in Dubai for Families in 2025?
Investor Impact
Heather Copland had dreamed of owning a home in Dubai for 16 years but left the emirate in June 2023 without fulfilling that aspiration.
“I bought a one-bedroom apartment in Zone 3, 704 Lily, as a second buyer in September 2007, paying Dh584,250 plus a Dh10,000 parking fee to Schon Properties. When construction stopped, Xanadu Real Estate Development took over, promising to complete the project within 2-3 years,” said the British citizen.
“We investors were encouraged to pay the remaining balance on our payment plan and the car parking fee to help expedite completion, which we did in full. Additionally, my Oqood was paid to Xanadu, though I am unsure whether they registered and paid the Dubai Land Department (DLD),” Heather explained.
“We are losing hope, as we fear the money [is gone], and there are concerns that the buildings, which have been exposed to the elements for over 10 years, may no longer be financially viable for potential investors to complete.“
Bibhu said, “Building D20 in the Lily Zone is complete, and many investors have paid the full amount for their units. For years, Xanadu told us that the lack of a proper access road is delaying the handover. We went back and forth and were shocked when we first saw the project had been canceled.“
The 54-year-old Indian expat, who came to the UAE in 1998, paid 75% of the property’s value for his one-bedroom apartment. “I have been waiting for my home for so long, but am now losing hope of even getting my money back, especially since I don’t have the sales and purchase agreement (SPA) or Oqood.
“I am just shocked at the prospect of losing everything after 17 years of long and painful waiting. Who will be responsible for all of this?“
Current Status
The 2008 financial crisis impacted several real estate developments, including the 5.7 million-square-foot Dubai Lagoon, which was separated into zones.
