Dubai-based developer Union Properties has reported a 66 per cent rise in first-quarter profit, attributing the increase to handing over units in its Motor City development.

The real estate firm reported a net profit of Dh50 million ($13.62 million) in the three months to March 31, it said in a statement, compared with a net profit of Dh30.13 million in the same period last year.

Investment bank EFG-Hermes forecast the developer would make a quarterly net profit of Dh30 million.

Union Properties' first-quarter revenues were Dh846 million, a 48 per cent increase over the Dh572 million it reported for the same period last year.

The company took provisions of Dh70 million to cover losses on the value of investment properties, it said. Gross operating profit stood at Dh179 million for the quarter.

Shares of the developer, which is hoping to sell its Ritz Carlton hotel in Dubai for about Dh1.5 billion, ended 5.8 per cent higher. Its chairman, Khalid bin Kalban, told Reuters in March, it had received 'negotiable' offers for the hotel.

He told papers in the United Arab Emirates the same month the firm would be willing to sell any of its projects if it received a fair price.

Earlier in the day, Union Properties said its shareholders approved the extension of its Dh405 million bridge-loan facility, provided by Emirates NBD to March 31, 2014.

The company's shareholders also approved the extension of maturity of a 2.1 billion dirham and a $188.4 million syndicated loan facility to Dec 31, 2013, it said in a statement to the bourse.

Property firms in Dubai have been hit hard by the global downturn, which sent prices in the emirate's once-booming real estate tumbling some 60 per cent from their peaks in 2008.

Union Properties suffered a loss of Dh148 million in the fourth quarter. – Reuters