Analysis by GREM: Internal organization, customer satisfaction and investment risks

DAMAC Properties is one of the larger real estate developers in Dubai and positions itself as a luxury brand in the market. Nevertheless, research by GREM shows that there is considerable criticism of the internal organization, customer relationships and transparency towards investors. Both employees and buyers identify structural deficiencies that have consequences for investment security and customer satisfaction.

Internal communication and company culture

DAMAC's internal organization is characterized by a top-down management structure, with little transparency and cooperation between departments. Employees identify a culture that is often described as “toxic” or even a “culture of fear,” where HR is barely functioning and decisions depend on senior management's personal preferences. Interviews with staff also show that there is a lot of focus on micromanagement and strict top-down control, leading to frustration and a lack of autonomy. Staff turnover is high, and there is a lack of certainty and structure (Glassdoor.com, 2024).

Customer relations and after-sales service

On the customer side, there appear to be significant shortcomings. Buyers report misleading sales practices, where promised returns or design features ultimately turn out to be wrong. Interviewed buyers provide numerous examples of delayed deliveries, changed floor plans and unexpected costs.

In a concrete case, an apartment was delivered 4.35% smaller than contractually agreed, without prior explanation (ArabianBusiness.com, 2023). According to customers, after-sales service is difficult to reach and slow. Problems are often not resolved or only after a long delay. This picture also appears emphatically in interviews and complaint analyses carried out by GREM.

Legal disputes and transparency

The combination of aggressive sales, opaque communication and delayed deliveries has led to multiple legal conflicts. A common example is the lawsuit of a German investor who sued DAMAC in 2010 for serious project implementation deficiencies and lack of financial transparency (TheNationalNews.com, 2010). Customers also complain about the lack of clear information about service costs, mandatory participation in rental programs and unilateral changes to project concepts without consultation. These patterns point to structural deficiencies in customer focus and governance.

Build quality and supervision

Although DAMAC positions itself in the market as a luxury developer, residents and user reviews point to recurring quality issues. Complaints about moisture, noise pollution, poor workmanship and moderate maintenance are frequent on public review platforms. Despite formal warranty periods, as prescribed by RERA, many buyers face considerable resistance in claiming recovery. Service requests are dealt with slowly, and there is often an indifferent attitude on the part of building management. These complaints are also explicitly addressed in GREM's user experience evaluations. It is remarkable that even at DAMAC's own sales center in Dubai, GREM observed broken tiles and damaged walls — highlighting the contrast between the presented brand promise and the actual finishing standard. Interviews with buyers show that this image is widely recognized.

Financial performance and market position

DAMAC had a top year in 2018 with a net profit of AED 1.15 billion, but fell into the red in 2019 (Reuters.com, 2019). Since then, the company has been working to reduce debt; in 2023, approximately AED 4.5 billion was still outstanding, partly due to the sale of non-strategic assets (AprilProperties.com, 2023). Between 2015 and 2022, DAMAC was listed on the stock exchange, but the share price fell by more than 80% since the IPO — which was due to declining investor confidence (GSN-Online.com, 2021), according to GSN. This downward trend reflects a reduced market valuation and is also mentioned in GREM's financial analysis.

Investment value and resale

The resale value of DAMAC projects varies. In periods of oversupply, such as during the coronavirus pandemic, prices of DAMAC projects often fell faster than those of top developers. DAMAC Hills 2 is regularly mentioned here: here, prices fell by around 30% between 2018 and 2020 (Phoree, 2021). The combination of high service costs, construction quality problems and ongoing new construction makes liquidity relatively weak. In addition, buyback guarantees are missing, while rental expectations are often presented too optimistically in sales conversations. This imbalance between promise and reality increases the risk for investors, according to GREM's project analyses.

Conclusion

Although DAMAC has realized some visually pleasing projects, both employees and buyers — as analysed by GREM — point to fundamental weaknesses in business operations, customer service and legal reliability. For investors, this means increased risk, both financially and legally. Transparency, delivering on promises and customer focus seem to be structurally deficient. As a result, trust in DAMAC as a developer is under pressure.