Nakheel Wrote Off $21.4 Billion in Values After Dubai’s Real Estate Crash - Bloomberg

Nakheel PJSC, Dubai’s biggest developer, told creditors it wrote down 78.6 billion dirhams ($21.4 billion) from the value of its real estate as property prices in the emirate crashed.

The Dubai government-owned company wrote off 301.4 million dirhams in the first half of last year, 73.8 billion dirhams in 2009 and a further 4.44 billion dirhams in 2008, according to its Islamic bond prospectus issued last month and obtained by Bloomberg News. After the write-offs, the company’s share capital dropped to 10.6 billion dirhams in June 2010 from 87.1 billion dirhams in 2008. Nakheel declined to comment.

Dubai’s property market had one of the world’s biggest reversals of fortune following the global credit crunch three years ago, with Deutsche Bank AG saying home prices slumped 64 percent since their peak in mid-2008. Nakheel was forced to reduce staff and halt work on projects including the man-made islands of Deira and Jebel Ali.

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