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Gulf property developer issues legal notices over outstanding payments

Hydra Properties has sent the notices to investors on its flagship Hydra Village project threatening to re-acquire units if outstanding amounts are not paid.

The letter indicates that payments made on properties, including the purchase reservation and all installments, will be forfeited if investors fail to pay the remaining amount owed.

Hydra commercial director Ahmed Khalil confirmed legal notices had been sent to a handful of defaulting investors. But a group of investors claim that 100s of email have been sent out saying they have been fined Dh500 per day retrospectively since they signed the reservation forms, most of which date back to the project launch in 2007.

The move comes amid growing anger among Hydra investors who are unhappy about the pace of development at the project and price increases which they claim have been imposed without consultation.

Hydra Village was due to be finished this year but completion has been delayed until 2011. Hydra CEO Dr Sulaiman Al Fahim has tried to calm the anger and apologised to investors for poor customer relations. But now they say this is another blow that fuels the discontent.

'In the current economic climate Hydra should be encouraging investors, talking about re-payment plans and seeking way to keep things going,' said one investors in the project.

'Instead they claim they are open and approachable in public but behind the scenes they are taking decisions without consulting investors,' he added.

They are also angry that Al Fahim claimed that there were not lots of investors in the project who were late paying installments and that his finance team was talking with those that were to change payments plans.

Karl Howard, co-chair of the Hydra investors group which has 300 members, said the letter has been sent to all stakeholders. 'Those who have signed a contract but have asked their mortgage lenders to cease payment till proof of construction has been ascertained, have received them and people who have never signed, nor even seen the latest contract, have also received them,' he said.

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