Stalled Amwaj Gateway project in Bahrain sold for $59.7mln

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Bahrain - A stalled property development in Bahrain has been sold off to an American company in a public auction.

M Tech Services successfully bid BD22.5 million for Amwaj Gateway yesterday at the fourth attempt to sell off the project.

On February 1, its reserve price was slashed by an additional 15 per cent to BD22m from its original price of BD36m.

Amwaj Gateway was launched in 2007 as a $183m beachfront project and was scheduled for completion in 2010.

The development was supposed to include 384 apartments, 93 town houses and a hotel tower with 143 rooms.

However, work stalled in 2009 in the wake of the global financial crisis and in 2015 it was among projects referred to the Committee for the Settlement of Real Estate Projects.

Yesterday’s auction was held on the third floor of the Justice, Islamic Affairs and Endowments Ministry headquarters in the presence of the committee operating under the ministry.

The special committee was formed to resolve the issue of unfinished real estate projects and had been tasked with finding a buyer for the development.

Real estate specialist Cluttons and auctioneer Mazad organised the auction.

“The auction was successful and the property was sold to an American company M Tech Services for BD22.5m,” a member of the committee confirmed to the GDN.

The project first went up for auction on October 31 last year with a reserve price of BD36m, but failed to attract any interest.

No bids were made during a second auction on November 29, when the reserve price was lowered to BD30.5m as well as at the third attempt on December 13, with a reserve price of BD25.5m.

“Based on the law of civil proceedings in Bahrain, within the next 10 days anyone can outbid, at a price that is not less than one-tenth more than the sale price,” said a committee statement.

“The new bidder should deposit a fifth of the total bid amount (new) with the treasury of the Justice, Islamic Affairs and Endowments Ministry.

“There shall be no more out-bidding after 10 days.”

Other delayed projects being handled by the committee are Marina West and Sunset Hills.

Work first started on the $750m Marina West in 2007 with developers promising 10 residential towers offering more than 1,000 apartments alongside a five-star hotel.

Nearly 400 homeowners who pumped money into the project, located on Janabiya Highway, are still waiting for their homes.

Sunset Hills, at Al Areen Development, is a joint venture between Abu Dhabi Investment House and Sorouh Investments, a Kuwaiti investment firm.

The $100m project was launched in 2007 and included 300 real estate units, including villas, deluxe villas and luxury apartments which were supposed to be completed in 2009.

The GDN reported on Wednesday that a national strategy to regulate the real estate sector in Bahrain was among the top priorities of the newly-established Real Estate Regulatory Authority (Rera) which started its operations yesterday.

Rera aims to put in place a system of proper licensing and regulations that would prevent further incidents of stalled projects.

However, the existing stalled projects will be outside its remit.