Developer still owes £6.5bn

Developer Nakheel has again delayed repaying $10.5bn (£6.5bn) of debt to creditors, including UK consultants, some of whom are now “jaded” by the company’s failure to pay up.

However, despite being “disappointed” by Nakheel’s second missed deadline this year, engineer Halcrow, which is one of those owed money, confirmed that it had signed a contract to start new work for the Dubai-based firm.

Last week Nakheel, responsible for schemes including the man-made Palm island, said that it now expected its debt restructuring to be finished in the first half of 2011, rather than in the first quarter of the year as previously promised.

Nakheel is thought to owe £250m to UK consultants and engineers including Halcrow, Atkins, EC Harris, Hyder, Mouchel and WSP.
One consultant owed money by Nakheel, who wanted to remain anonymous, said he was “not surprised” by the announcement.

“We’ve all had big money owed to us, but we’ve not seen any of it,” he said.

David Yaw, regional managing director for Halcrow, said that despite the announcement the engineer last week signed a new deal to work on a “modest sized” project for Nakheel in the UAE.

“We were a bit disappointed,” he said. “But are we totally despondent and think that it’s [the repayment] not going to happen? No.”
In January Nakheel said that 91% of creditors had agreed to a deal where 40% of debts would be paid in cash, and the remaining 60% in sukuks - a type of Islamic bond - to be issued in the first quarter of this year. It needs 95% of them to agree to the plan before it will proceed.

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