Nakheel has the right to prevent residents at the Shoreline Apartments on the Palm Jumeirah from using the beach if landlords don't pay the service charges — but they cannot prevent tenants from using the pools and the gym, a top government official told Gulf News.
Sultan Butti Bin Mejren, Director-General of the Land Department, added that Nakheel has the right to go to court if property owners refuse to pay the accumulated service fees, and that landlords could even lose their properties.
His comments came hours after Nakheel issued a statement saying that it was waiting for a ruling from the Real Estate Regulatory Authority (Rera) regarding the dispute, which has seen a number of tenants in the Shoreline Apartments denied access to facilities and beaches.
"Nakheel property owners should pay service charges, otherwise they might go to court and end up losing their property," Bin Mejren said.
He said that the Land Department recommends the establishment of property owners' associations to fast-track solutions to disputes between property owners, developers and tenants.
"In Dubai, we have around 200 property owners' associations while it should be around 1,900. But in 2012, we plan to increase the number and promote this concept," he said. "These associations will maintain relations between all parties concerned and reduce the number of disputes by clarifying the rights and duties of each stakeholder."
Moreover, it would represent property owners at government departments as well as in court. "All over the world, if owners are obstinate about paying their service fees, usually find their properties up for auction," Bin Mejren said.
According to the Land Department, beaches come under Nakheel's ownership and access to them should be organised between owners and Nakheel, while the gym and pools constitute common areas in the building.
Meanwhile, Nakheel has urged all residents, including tenants, in the Shoreline Apartments to contact its customer service department for clarification.
Nakheel chairman Ali Rashid Lootah said, "This issue is under review by Rera, and we await their decision for a way forward. Naturally, we will respect whatever decision they make.
"Meanwhile, Nakheel is not preventing anybody who has paid their service fees from using our private beaches, pools and gyms. About 78 per cent of the fees due have been collected, and these residents have the right to access our facilities. However, this majority cannot be expected to subsidise those who have not paid.
"One month ago, outstanding service fees amounted to Dh72 million. That figure has now reduced by 20 per cent to Dh57 million. We continue to push ahead with outstanding payment collection to allow us to ensure ongoing maintenance and improvements at our facilities, and payment to our service providers.
"Customers who have honoured their payments tell us they are happy with the continued improvements in our facilities — beaches are cleaner and quieter with more of a family atmosphere since we began our fee collection campaign in November 2011. They have also welcomed our reduction in service charges at the Shoreline Apartments — fees have dropped by 35 per cent since 2009."
Long-term (annual lease) tenants at the Shoreline Apartments can check with Nakheel on whether their landlords have paid service charges or not.
"Tenants are understandably disappointed if they rent an apartment only to find they cannot use the facilities because of unpaid fees. Now they can get confirmation from us to ensure that they get what they sign up for when they move into an apartment."
Bin Mejren added: "We did approve the service fees for Nakheel for both 2010 and 2011. It is eligible and should be paid."
Service fees are charges to maintain Nakheel's services and facilities for the benefit of both property owners and tenants, Bin Mejren said.