“In the second quarter of 2011 no additional apartments were sold in either Phase 1 or 2. Legal proceedings against the contractor are continuing both in local and international courts. At the current stage of these proceedings it is very difficult to advance an estimate of the likely outcome,” the report said.
ECDC owns 50% in the company that develops the Asmita Gardens project, an investment of some EUR120 million, while Indian company Asmita owns the other half.
For almost two years, developers are trying to settle a dispute with Strabag, the builder of the project.
“Site operations continue to be suspended due to current negotiations between the joint-venture partner and the senior lender for unlocking short term funding of the project and then resolving the position with the main contractor,” ECDC said.
It added the financing facility is technically in default, and negotiations are focusing on “securing and implementing a medium term financing package which will facilitate a work out of the development.”
Around half of the units in the Asmita Gardens project are not sold.
ECDC also owns in Romania several office buildings and it is a shareholder in ERA Shopping Centre projects in Oradea and Iasi.