UAE conglomerate Al Habtoor Group has announced plans to build a new $1.33 billion hotel and entertainment complex in Dubai, despite a punishing property collapse that has sent prices plunging from their 2008 peak.

Khalaf al-Habtoor, the group's chairman, said on Wednesday that the Habtoor Palace complex will begin construction in June and is slated to be completed in 40 months time.

John R. Harris & Partners are the concept design architects for the new complex which will be have three hotels, a shopping arcade and theatre. Khatib & Alami Consolidated Engineering Company will be the lead design consultants, he added.

The group's 34-year-old Metropolitan Hotel, which now stands on this choice location, will be demolished to make way for the new undertaking, said Khalaf Al Habtoor.

'We will go ahead with the project despite the fact that there is no appetite in the financial sector to fund projects. We will be depending on our own cash flow. I don't believe in bonds, I believe in the revenue of the group,' he added.

The giant hotel project boasts of a magnificent view of the Safa Park, the Burj Khalifa Business Bay canal and The Meydan. It will also overlook its own exceptional landscaped garden.

'At approximately 400,000 sq ft in area, the garden, whose fountain; exotic flowering shrubs and trees; and gazebos, are presented to Sheikh Zayed Road, will irrefutably enhance the reputation of Dubai as one of the most beautifully landscaped cities in the Middle East,' said Khalaf Al Habtoor.

According to him, the new project will combine classic elegance with quality in every sphere.

Its facilities will include a 5-star serenity spa, multiple-themed restaurants, 50,000 sq ft banqueting and meeting facilities, an international designer brands shopping arcade and a unique and new theatre which has the potential to become a stunning and prime destination point for visitors to Dubai, he remarked.

'This extensive and resplendent theatre will introduce to Dubai some of the world’s best theatrical performances from places such as Broadway and Las Vegas,' revealed Khalaf Al Habtoor.

'With over 1,000 seats, this artistic arena will provide the highest degree of technical development and multi-media effects, including a hydraulic central stage, water features and movable floors.'

'A tennis and sports academy will also grace the project which will be for the services of guests as well as local sports enthusiasts providing courts equipped according to the highest international standards,' he added.

Al Habtoor, which has a joint venture construction firm with Australia's Leighton Group, has car distribution and leasing, education and publishing operations.-Reuters