Dubai Renters Face Eviction After Broker Fails to Pay Landlord

Dozens of tenants in Dubai say they’re facing eviction after Haitham Mahmoud Alkouatly, a Saudi real estate and entertainment-company owner, collected payments and then failed to pass the money to the property owners.

Dubai’s Department of Economic Development and the Real Estate Regulatory Agency are investigating, RERA Chief Executive Officer Marwan bin Ghalita said. Major-General Khamis al Mazinah, deputy commander of Dubai police, said an investigation is under way.

Laws governing property agents, rent increases and foreclosures have come into force gradually in the years after Dubai’s real estate market crashed in 2008. Bin Ghalita said a rule requiring tenants to register leases with his agency improves rental data, protects tenants from dubious brokers and prevents the rental of a property to multiple people.

“We require brokers to provide a 5-million-dirham ($1.4 million) deposit with RERA to ensure against this kind of situation,” bin Ghalita said.

Carl Dowling says he paid a year’s rent in advance for his Dubai apartment after Alkouatly promised a month free and no rate increase. After shelling out 60,000 dirhams, he discovered that the landlord never received the money and the broker can’t be found.

Hopes Fade

“We are left high and dry and we don’t have much hope of getting our money back,” Dowling, a 30-year-old from the U.K., said in an interview. “We share some of the blame, but we don’t understand how an event-management company was able to get the listing for so many homes and deal among other brokers.”

Tenants are responsible for ensuring the brokers they deal with are legitimate and registered with the regulator, bin Ghalita said. Alkouatly has a license to sell and manage property with the Department of Economic Development, according to documents on its website. He’s not registered with RERA.

Calls to the landline phone listed on the license weren’t answered and the mobile phone was out of service. Another mobile number provided by clients is also out of service. Calls and an e-mail seeking comment to the Department of Economic Development weren’t returned.

Alkouatly, listed on the LinkedIn website as chief executive officer of event-management company Shamyana Entertainment, also rented the same apartments to more than one tenant and falsely claimed ownership of properties, according to his clients and the real estate regulator.

Around 50 tenants who used his services attended a Sept. 2 meeting to discuss how to recoup their losses and they have started a Facebook group to coordinate a response, Dowling said.

To contact the reporter on this story: Zainab Fattah in Dubai on zfattah@bloomberg.net.

To contact the editor responsible for this story: Andrew Blackman at ablackman@bloomberg.net.

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