Dubai : Investors in a contract dispute with Omniyat Properties claim to have received "threatening" letters from the developer demanding they sign up to new leasehold contracts.

XPRESS has seen copies of the letter, which warns investors that they face legal action if they do not agree to the contracts for The Square development in Al Mamzar by December 31.

The letter also warns investors against meeting and discussing the issue with other people affected. It states: "Kindly be reminded that Dubai law does not permit such forms of collective action... should we become aware of any further activities of this nature, we will have no alternative but to make a report to the Dubai Police."

The letter comes in the same month that a group of 50 investors called a press conference blaming Omniyat for asking them to sign new Sale and Purchase Agreements (SPAs) with "unfair rules and regulations" including imposing a handover fee and not being allowed to sublet or sell their units without the developer's own broker. They have sent their documents to the Dubai International Arbitration Centre for action.

"We are sticking to our current position of taking the matter to the arbitration centre and we should know where we are by January 7," said Murtooza Amthaniwala, a businessman who received the letter.