Dubai to invest $5 billion in Istanbul

Dubai Holding property unit Sama Dubai on Wednesday made a winning bid of $705 million in a tender for land in Istanbul's thriving business district where they plan to build a major business and leisure complex.

Dubai to invest $5 billion in Istanbul
The price, YTL 980 million including  value-added tax, was fixed to YTL 1.16 billion. The appraisal value of the land was YTL 266 million. Mayor Kadir Topbaþ said the payment would be made completely in cash.  The Sama Dubai is expected to build two skyscrapers, the tallest of which is estimated to be 300 meters high, on the 46,241-square-meter plot of land it won in the auction that is suitable for business or housing construction.

Following the opening of the envelopes, it was revealed that the three companies bidding the highest price were Sama Dubai (YTL 840 million), Zorlu Holding (YTL 707 million) and Fiba-Nurol Joint Venture (YTL 505 million). Additionally, Biskon Yapý offered YTL 440 million, Toray Ýnþaat YTL 401 million, Taþyapý Ýnþaat YTL 400 million and Limak Ýnþaat YTL 310 million. In accordance with the rules of the tender, the bidding would go on with the three biggest bidders, Sama Dubai, Zorlu and Fiba-Nurol, who dropped out of the bidding at the beginning of the auction.     The two remaining competitors continued increasing the price in increments of $1 million. The price rapidly climbed over $700 million, but Zorlu had to give up after Sama's last bid of $705 million. The last price that Zorlu had offered for the ÝETT land was $701 million.

Only seven out of the 19 companies who had bought bid specifications participated in the tender. Topbaþ said the result of the tender clearly reflected Turkey's economic stability and the development level of Ýstanbul. In his address of gratitude after the proceedings, Topbaþ claimed that the land was sold beyond its actual value, despite worries stemming from the upcoming elections. Indicating that the land was the largest piece of property the city owned, Topbaþ said the money coming from the sale would be spent on transportation projects to ease Ýstanbul's chronic traffic problem. He added that the municipality has several other properties and they would also be liquidated and utilized as a fuel for more investments. He noted that the Treasury's share in the land will also be paid to this institution.

Topbaþ had said on Tuesday that the sale of the land was extremely important for them, noting that they were expecting "to earn more than $1 billion from the sale." Following Topbaþ' speech, the parties signed the contract.

Topbaþ requested the Sama Dubai delegate to sign the contract with Topbaþ's own pen, saying, "This pen will be a souvenir for me." Another piece of property belonging to the General Directorate of Highways in a nearby locationwas sold last month after a record $800 million bid by the Zorlu Group.Istanbul's business district is booming and real estate prices are soaring.

The land had previously been at the center of a controversy when the Ýstanbul Metropolitan Municipality (ÝBB) had decided to hand it over to the Dubai group, later known as Sama, to construct two huge skyscrapers in October 2005. But strong opposition emerged, claiming the lands were being given to the Dubai Group without any tender, excluding other interested parties. The municipality eventually stepped back. The tender was held in a hall belonging to ÝBB Directorate of Youth and Sports near the central building of the municipality.

The land was first up for sale in 1998 for the first time and bought by Ali Haydar Veziroðlu, a businessman dealing in construction, for $105 million. As he failed to raise necessary funds to finance the purchase, Veziroðlu had to give up the land. Famous organizer Ahmet San had also wanted to buy the land some six years ago. He offered $400 million for the property with the intention to build a congress center along with a shopping mall and many offices, but he received no response. Speaking after the auction, Ýstanbul Mayor Kadir Topbaþ said this sort of property was extremely rare in Ýstanbul, and this was the key to its profitability. Ýstanbul Chamber of Real Estate Brokers Chairman Sabri Ateþ said the sale of KGM land in the Zincirlikuyu district and the ÝETT land in the Levent district boosted the real estate prices in that region, and underlined the prices of the recently sold lands were just and fair. Istanbul's business district is booming and real estate prices are soaring.

Ankara Chamber of Commerce President Sinan Aygün said the auction showed he had been right when he appealed the hand over of the land to the Dubai company a year ago without an auction. Sama Dubai is planning to build two 300-meter high skyscrapers, the Dubai Towers, with a unique corkscrew design. 

Güncelleme Tarihi: 20 Eylül 2018, 18:16