Mubasher: The Dubai Land Department’s (DLD) recent seizure of Schon Properties’ assets was well received by investors in the UAE’s real estate sector, a new report showed.

Schon Properties had unveiled a number of projects over the years, many of which never came to light even though the company had collected billions of dirhams in deposits from customers and investors.

Last week, the DLD also seized the deposits put in Schon’s escrow account, while the Dubai Public Prosecution worked on completing “legal procedures to secure the rights of all investors and other parties,” Arabian Business reported.

The asset seizure came after buyers, both UAE residents and foreigners living abroad, issued complaints against Schon Properties after they paid deposits totalling AED 7 billion ($1.9 billion) for units in its Dubai Lagoon project.

The Dubai Lagoon project was launched in 2005 with completion slated for 2008. Over a decade later there were still no Dubai Lagoon project.

In February, Schon Properties, which had repeatedly announced delays for handover deadlines, said it had transferred part of the project to developer Xanadu Real Estate, in an attempt to speed up project completion.

Among them was Dublin-based Indian national Shakeel Mangalgatti, who told Arabian Business he invested in the Dubai Lagoon project in 2006, when he was told that it would be delivered in “two or three years – not more than that.”

“But nothing happened,” he said. “They didn’t even start construction.”

Dublin-based Indian investor Shakeel Mangalgatti was among the investors in Schon’s Dubai Lagoon project in 2006. They told Arabian Business that the company had said it would deliver the project “two or three years – not more than that.”

Despite that, “nothing happened,” Mangalgatti said. “They didn’t even start construction.”

The Indian investor said that he was asked to pay AED 341,501, which represents 55% of the property’s price, but after payment he tried to contact Schon Properties who were not available.

At one point, [Mangalgatti said], he interacted directly with company president Daniel Schon. “I got his number, but it was no use,” the investor told the newspaper. “I spoke to him and he wasn’t interested.”

Similarly, Omani investor Said Al Balushi, who began investing in the project last year was asked to pay AED 30,000 which made up 20% of his unit’s price.

With no development in the vicinity, Al Balushi approached the DLD and Dubai Courts, who told him that the project “might be cancelled.”

Al Balushi described the DLD’s seizure of Schon’s assets as “very good news and a big step.”