Dubai: Dubai master-developer Union Properties’ gathered losses as of the end of 2020 which were Dh1.96 billion – that is 45.7 percent of the company’s share capital.
It will be a percentage that Union Properties should be a close watch on. Whenever collected misfortunes arrive at 50% of settled-up capital, investors should choose the future strategy and whether the organization should proceed as a going concern or not.
Yet, the administration at Union Properties is confident enough, and that an overall upswing in the real estate area is all that is required to make something happen.
“These accumulated losses are predominantly due to variations in valuations of its real estate portfolio,” the developer said. “These accumulated losses could potentially be recouped in the event of an increase in the prices of land in Dubai.”
The developer announced net benefits of Dh200.1 million for 2020, a smart turn the Dh224.3 million loss a year prior.
Plan of action
Union Properties, which has the Motor City project in its active project portfolio, is working on a three-year plan that would:
- Restructure remarkable obligation (a year ago, it marked one with Emirates NBD for the openness of almost Dh1 billion);
- Recovering remarkable receivables (prominently through court and intervention – a year ago it recorded cases for Dh1.5 billion);
- Proceeded with a decrease of working expenses;
- • Development of its “extensive” land bank;
- Improvement of resources with repeating capital; and
- Focus on working auxiliaries with a potential listing for specific elements. Furthermore, focus on cash-generating exercises.