The Tourism Development and Investment Company (TDIC), the master developer of major tourism, cultural and residential destinations in Abu Dhabi, announced today that it has signed with Abu Dhabi Commercial Bank (ADCB) an escrow accounts agreement for its upcoming projects.
This step is in compliance with the new Abu Dhabi law for the regulation of the real estate sector which requires developers who wish to sell units off-plan to, among other things, set up escrow accounts for their projects for the collection of sale proceeds, and which fall under the authority and control of the Department of Municipal Affairs and Transport.
Sufian H. Al Marzooqi, TDIC's Chief Executive Officer, said: "TDIC welcomes the rules and regulations of the new property law which serve to safeguard the interests of the investors and developers in the industry. We consider that the law further enhances the confidence and transparency in the market as well as strengthens security for local, regional and international investors. It is without a doubt a very positive step in the right direction."
Ala'a Eraiqat, ADCB Group Chief Executive Officer and Board Member, said: "TDIC and ADCB’s engagement around the escrow account laws in Abu Dhabi is a very important milestone since the announcements of the escrow regulations in the Capital. We are pleased with TDIC’s decision to bank their escrow accounts with ADCB and this comes based on ADCB’s extensive track record with the real estate escrow operations and our commitment to provide the service excellence needed in such a delicate and heavily regulated industry."
The new law introduces the requirement for the set-up of a project escrow account prior to approval being given for a property developer to commence the off-plan sale of units. It provides protection for customers of off-plan developers by ensuring that funds paid for the purchase of units are not accessible by the developer until such time an acceptable level of progress in the construction of the project has been achieved.