Saudi investors seek SR225m recovery in Bahrain Marina West project

RIYADH: Some 150 Saudi investors, who pumped more than SR225 million ($60 million) on Bahrain’s Marina West project, have called on the Bahraini government to intervene and get their invested funds back from the stalled project, local media said.
Many foreign investors, including the Saudis and the GCC citizens, have invested nearly SR400 million in the project that is stalled for three years.
The investors have called for a public auction of the project to have their funds reimbursed.
The Marina West project is composed of 500 housing units and the investors paid 80 percent of the project’s cost. The units were supposed to be delivered in December 2010 but not completed, which prompted them to file their cases in Bahraini courts.
Owners of the project had launched a publicity campaign in Saudi market, which attracted a number of foreigners and Saudi investors, including former and current employees of Saudi Aramco.
The project is one of eight other stalled housing projects in Bahrain, and a lot of investors are looking for answers to their investments in Bahrain.
The project consists of 11 towers, 10 of them residential comprising 1,120 apartments. The remaining tower is designed to be a five-star hotel.
Hassan Al-Husseini, one of victims of the stalled project and coordinator of owners of apartments in the project, said the stoppage of the project is not related to the political and security crisis in Bahrain but, rather, to the administrative and financial corruption of the developer company. The developer borrowed from financial institutions about SR160 million to set up towers on a plot of land evaluated at the time at SR370,000 in 2003, then rose to SR500 million afterward, Al-Husseini said.
Al-Husseini added that the project was presented for the first time in 2006 as an integrated residential project, with the residential units valued at SR1.125 billion.
In 2007, the cost of the project was raised to SR2.8 billion without known reasons, while the residential apartment prices rose by 150 percent.
The faltering started in February 2009 when workers belonging to Al-Hamad Contracting Company went on strike due to non-payment of wages, he said.
Marina project owners received many solutions to end the problem, including offers from the Gulf and European companies to purchase the project but they were not accepted, the media said, adding that the latest offer came from a Saudi investor at SR600 million.
He confirmed that the number of affected people reached 400 investors from 28 nationalities, including Saudi, Bahraini and British nationals, in addition to other nationalities from various nations around the globe.