Light At The End Of The Tunnel in JBR Service Charge Despute

One of the things most likely to attract negative publicity in Dubai is unreasonable behavior from a developer when it comes to dealing with customers. Whilst not that common, when it does happen, it tends to generate a lot of interest and does in some ways act as a reminder that the Dubai real estate market is still young and still has some way to go before it fully matures into what it would like to become. Dubai developers have in the past not always acted in the interest of customers, but the most recent story to cause uproar among residents does not actually involve a property developer but rather a property management company. The dispute surrounding Jumeirah Beach Residence has been covered on the blog before, but it now seems like the deadlock between the residents association and Property Management Company Salwan is on its ways to being broken. Whilst a resolution doesn’t look guaranteed at the present time, there is some progress being made at least.

The dispute steams from when Salwan told residents it planned to increase property service charges some 129% on the previous service charge, increasing the fee to AED 21.75 per square foot. Residents could not see the justification in such a large price hike, but Salwan Property Management insisted the increase was necessary to cover the costs of maintaining the AED 7 billion 36 tower project. Needless to say residents didn’t quite agree, and quickly moved to form an association to represent themselves. Salwan is reported to have asked for a meeting with the Dubai properties Regulatory Agency (RERA) to state is now only wishes to increase from AED 9.5 per square foot to AED15.

This is some reduction on its original requirement of AED 21.75, but residents aren’t quite yet ready to play ball. They are asking that Salwan reveal the actual maintenance costs paid out in the past two years, so they can have a better understanding of why Salwan deemed such a large price increase necessary. They also want clarification on the legality of Salwan’s actions to increase maintenance charges without first consulting RERA. With RERA now acting as an intermediate, and Salwan reducing its initial costs, there could be light at the end of the tunnel.

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