Dubai-based Emaar Properties has agreed to set up a $100 million venture to develop residential and commercial projects in Syria with Cham Holding.

Cham Holding is controlled by Rami Makhlouf , a businessman targeted by US sanctions.

Emaar, which owns US company John Laing Homes, said it will own the venture equally with Cham Holding.

A spokesman for the company could not immediately comment on doing business with a company owned by Makhlouf.

Makhlouf, a cousin of Syrian President Bashar al-Assad, told Reuters last month the project will have government support to reorganise areas where illegal buildings are rampant in the Syrian capital.

The US Treasury Department said in a statement on February 21 that Makhlouf had used intimidation and his close ties to the Assad regime to obtain improper business advantages.

Emaar laid the foundation stone in June 2006 for a $500 million residential complex near Damascus but construction has not begun.

The firm posted a record fourth quarter profit as a pick-up in countries such as India and Morocco offset a slowdown in US operations.

The United States says Syria is pursuing disruptive activities in Iraq, Lebanon, and the Palestinian territories. Damascus has repeatedly denied the allegations by Washington. - Reuters