Damac advert spend surges but profits fall
Damac advert spend surges but profits fall
The Dubai-based developer is well known for its marketing gimmicks such as including speed boats and sports cars with the homes it sells and often has a large presence of salespeople at events like the annual Cityscape shows in Dubai and Abu Dhabi.
But the developer’s latest marketing drive comes amid a subdued property market in the emirate where it faces stiff competition from rivals developing thousands of new units.
On Wednesday Damac reported its third quarterly decline in profits on the trot, reflecting the headwinds facing the wider property market.
Third-quarter profit fell 20 percent to 719.34 million dirhams ($195.86 million) from a year earlier even as the developer ramped up marketing expenses by a third to 96.45 million
Despite the decline, Damac Chairman Hussain Sajwani gave an upbeat assessment of the market.
“Dubai’s property market has been steadily solidifying in 2017, with increasing sales transactions and robust fundamentals, and our medium to long term outlook remains positive,” he said.
“Dubai’s property sector is feeling the positive effects of the emirate’s appeal and growing sophistication on the world stage. This is evident from the growing real estate sales transactions at Dubai Land Department and we are confident of the growth prospects for the sector going forward.”
But that view does not chime with many brokers concerned about the potential over-supply of new homes hitting the
Property broker JLL estimates that as many as 80,0000 units could be delivered by the end of 2019 with developers including Nakheel and Deyaar, which also reported earnings yesterday, announcing new projects worth billions of dollars in recent months.
“This renewed sentiment does however raise the prospect of a potential over supply on the back of sales achieved through more attractive payment terms,” said Craig Plumb, the regional head of research at JLL.
US President Donald Trump’s eldest sons Donald Trump Jr. and Eric Trump visited Dubai in February for the opening of the Trump International Gulf Club.
The developer announced a tie-up with the Roberto Cavalli Group in the third quarter for a villa development called Just Cavalli.
The developer also handed over more than 850 units across its international developments which include its two-tower Esclusiva project in Saudi Arabia and its three-tower development project in Jordan.
US unveils new veto threat against WTO rulings
- US tells WTO appeals rulings in trade disputes could be vetoed if they took longer than the allowed 90 days
- Trump, who has railed against the WTO judges in the past, threatens to levy a 20 percent import tax on European Union cars
GENEVA: The United States ramped up its challenge to the global trading system on Friday, telling the World Trade Organization that appeals rulings in trade disputes could be vetoed if they took longer than the allowed 90 days.
The statement by US Ambassador Dennis Shea threatened to erode a key element of trade enforcement at the 23-year-old WTO: binding dispute settlement, which is widely seen as a major bulwark against protectionism.
It came as US President Donald Trump, who has railed against the WTO judges in the past, threatened to levy a 20 percent import tax on European Union cars, the latest in an unprecedented campaign of threats and tariffs to punish US trading partners.
Shea told the WTO’s dispute settlement body that rulings by the WTO’s Appellate Body, effectively the supreme court of world trade, were invalid if they took too long. Rulings would no longer be governed by “reverse consensus,” whereby they are blocked only if all WTO members oppose them.
“The consequence of the Appellate Body choosing to breach (WTO dispute) rules and issue a report after the 90-day deadline would be that this report no longer qualifies as an Appellate Body report for purposes of the exceptional negative consensus adoption procedure,” Shea said, according to a copy of his remarks provided to Reuters.
An official who attended the meeting said other WTO members agreed that the Appellate Body should stick to the rules, but none supported Shea’s view that late rulings could be vetoed, and many expressed concern about his remarks.
Rulings are routinely late because, the WTO says, disputes are abundant and complex. Things have slowed further because Trump is blocking new judicial appointments, increasing the remaining judges’ already bulging workload.
At Friday’s meeting the United States maintained its opposition to the appointment of judges, effectively signalling a veto of one judge hoping for reappointment to the seven-seat bench in September.
Without him, the Appellate Body will only have three judges, the minimum required for every dispute, putting the system at severe risk of breakdown if any of the three judges cannot work on a case for legal or other reasons.
“Left unaddressed, these challenges can cripple, paralyze, or even extinguish the system,” chief judge Ujal Singh Bhatia said.
Sixty-six WTO member states are backing a petition that asks the United States to allow appointments to go ahead. On Friday, US ally Japan endorsed the petition for the first time, meaning that all the major users of the dispute system were united in opposition to Trump.