The property company, controlled by state-owned Dubai World, will be able to make almost all coupon payments on the five-year Islamic bonds although “we are less confident about Nakheel’s ability to redeem the principal in 2015,” JPMorgan analyst Zafar Nazim wrote in a research note e-mailed today. Nakheel will face the risk of running out of cash in 2015 unless it starts new developments and sell land in three to five years, the report said.

Nakheel, which is building palm tree-shaped islands off Dubai’s coast, said on July 14 a group of its creditors unanimously supported a plan on altering the terms on $10.5 billion of loans and unpaid bills. The company expects to pay 40 percent of the money owed to trade creditors in cash and 60 percent through a tradeable sukuk, it said.

Nakheel and Dubai World, one of the emirate’s three main holding companies, are seeking to renegotiate terms on their debt after the deepest financial crisis since the 1930s roiled Dubai’s real-estate market and left companies unable to raise new funding. Property prices have fallen more than 50 percent in the city as banks cut mortgage lending.

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