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Trump rejects $2b Dubai deal with Damac

|By Saifur Rahman| US President-Elect Donald Trump said he’s rejected a Dh7.3 billion (US$2 billion) deal with Damac Properties at a press conference on Wednesday, just nine days before his inauguration as the 45th President of the United States.

“Over the weekend, I was offered $2 billion to do a deal in Dubai with a very, very, very amazing man ‑ my friend Hussain [Sajwani] ‑ a great, great developer from the Middle East,” Donald Trump said at the press conference on Wednesday. “I didn’t have to turn it down,” he said. “But I have a no-conflict-of-interest provision as president.”

His attorney said the President-Elect has decided not to go ahead with the pending deals, including more than 30 important deals in foreign countries.

Donald Trump’s  Trump Organisation operates a golf course – Trump International Golf Course at the $6 billion Akoya project being developed by Dubai-based developer Damac Properties. Akoya, spread over 42 million square feet, boasts a clubhouse, apartment buildings and villas selling for as much as $9.5 million dollars, mostly due to the Trump branding.

A Damac spokesperson confirmed the news, saying, “Damac confirms that the discussions took place as stated in the media briefing but the proposals were declined by the Trump Organization. These proposals were for a variety of different property deals. We continue to share a successful business partnership with the Trump Organisation and remain committed to delivering our joint projects already underway.”

Damac Properties, the largest private-sector property developer in the UAE, awarded 285 construction and consultancy contracts worth Dh5.25 billion across the GCC and UK during the period between January and August 2016. It is on track to sell 2,600 units with an estimated sales revenue of Dh7 billion in 2016.

The awarded contracts cover the public realm landscaping in Akoya villas at both Akoya by Damac and Akoya Oxygen as well as infrastructure and the Golf course construction at Akoya Oxygen. The Trump International Golf Club Dubai is a 18-hole, par 71 championship course designed by 2016 Olympic Games course architect  Gil Hanse, one of the most sought-after names in the game. In addition, the academy course provides ample opportunity to improve handicap.

The exclusive clubhouse features high-end restaurants and a luxurious spa and wellness centre, whilst a capacious pro shop stocks the latest in golf wear and accessories.

Akoya by Damac continues to make great progress, with the Golf course completed and the handover of 1,350 villas and apartments taking place this year. In Akoya Oxygen, seven main contractors have been appointed so far and the construction of 6,380 villas is in various stages of development, with many reaching level one. The golf course works are under progress while the backbone infrastructure contract is awarded and works commenced.

Damac has delivered 16,800 homes so far while the total value of its projects under construction and development touches Dh73 billion ($20 billion) that will keep the company busy for the next five years, Ziad El Chaar, Managing Director of Damac Properties, said recently. “We have launched Dh15 billion worth of projects in the first eleven months of the year while our sales campaigns are going well,” he said.

The company’s net profits declined 37.77 per cent to Dh2.8 billion in the first nine months of 2016, down from Dh4.5 billion recorded in the first nine months of 2015.

Husain Sajwani, Chairman of Damac Properties, recently said the President-Elect’s name is good for business. “He had a strong brand — and no question in the last 12 months, his brand became stronger and more global. I think it will have a positive impact on sales,” Sajwani told CNN in an interview on November 21, 2016. “He’s in no way discriminative. He doesn’t discriminate against sex, religion or anything else.”

Damac had to remove Trump name from its signboard in December 2015, when Donald Trump attacked the Muslim community and asked for a ban on new Muslim immigrants, following the San Bernadino shooting in California a few days before. His anti-Muslim comments put him as a front-runner in the Republican Presidential race.

However, the situation completely reversed on the night of November 8, 2016 – when Donald Trump shocked the world with a comfortable win, much to the relief of Damac Properties. Donald praised Husain Sajwani – whom he refers to as a very good friend – in his New Year’s speech.

Damac Properties, which employs 1,900 people, mostly in sales and development activities, has so far delivered 16,810 units; about 90 per cent or 15,089 units are in Dubai. The developer has a development pipeline of 62 million square feet involving 44,000 units – 95 per cent of which will be concentrated in Dubai.

Of the 44,000 units under planning and development, 19 per cent are serviced apartments and 6 per cent hotel rooms while the rest 75 per cent are residential, commercial and retail units.

As of September 2016, Damac Properties’ equity stood at Dh11.75 billion while its cash balance was stable at Dh8.9 billion. Its total debts reached Dh3.78 billion. The company’s total assets marginally grew to Dh24.34 billion in September 2016, up from Dh23.44 billion in December 2015.