WORLD PROPERTY CHANNEL ®

Dubai Ritz Carlton

(DUBAI, UAE) -- Debt-laden Union Properties of Dubai said on its website that its luxury 15-story Ritz Carlton hotel could be sold for close to Dh1.5 billion (US $408.35 million) when it is turned over to investors in May of this year.

"It could be sold for a price very close to this number," stated the third-largest developer by market value in Dubai.

Reuters reports the firm issued the statement correcting a press report which said the hotel would be sold for a price very close to Dh1.5bn.

"It is a wealthy asset and a high-end hotel," said Union Properties General Manager Khalid Al Jarwan.

Khalid Al Jarwan

"If there is any requirement for sale,  it will be close to the amount mentioned."  He added,  "If it materializes it will take care of a lot of the company's expenses."

In January, Credit Suisse slashed its price target for the stock to Dh0.03 from Dh0.80 and said even if Union Properties overcame its liquidity squeeze, there would not be much equity value left after meeting its debt obligations, Reuters reported.

Union Properties Chairman Khalid bin Kalban said in January the firm's Dh6.5bn debt position, which it was due to begin paying back in 2010, is now due in 2011.

Khalid bin Kalban

The firm said in its statement it has 5,000 units that will be transferred to its rental portfolio, which will be worth Dh500 million a year.

The Ritz Carlton hotel, which is based at the Dubai International Financial Centre, will be handed over to investors in May, Kalban said last month.

The hotel is the second Ritz Carlton in Dubai. The firm's shares were up two per cent at Dh0.5 on the Dubai Financial Market.

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