Nakheel and Kerzner sign agreement to develop Atlantis, The Palm in Dubai

Nakheel LLC and Kerzner International Limited today announced that the companies have formed a joint venture to develop Atlantis, The Palm, which will ultimately include a 2,000-room resort and water theme park. Atlantis, The Palm will be located at the center of The Palm, Jumeirah, a $1.5 billion land reclamation project in Dubai, United Arab Emirates. The first phase of Atlantis, The Palm is an estimated $650 million development project that is expected to include a 1,000-room hotel and water theme park situated on 1.5 miles of beachfront.

This announcement is part of the plan of His Highness Sheikh Mohammad bin Rashid Al Maktoum, Crown Prince of Dubai, to diversify the United Arab Emirates' economic base and substantially grow Dubai's tourism, which is  what Kerzner International achieved in The Bahamas with the opening of Atlantis, Paradise Island in 1994. Atlantis, Paradise Island was the primary driver for the sustained period of economic growth that The Bahamas experienced throughout the late 1990s. From 1995 to 2000, The Bahamas total visitor arrivals jumped by 30%. Atlantis, Paradise Island's brand awareness ranks second only to Disney in warm weather resort brands in the United States.

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"By expanding our relationship with Kerzner to develop Atlantis, The Palm, we  continue our efforts to contribute to the growth and development of Dubai," said Sultan Ahmed Bin Sulayem, Chairman of Nakheel. "The uniqueness of Atlantis, The Palm is fulfilling the vision of His Highness Sheikh Mohammad bin Rashid Al Maktoum, Crown Prince of Dubai."

Kerzner International Chairman, Sol Kerzner, commented "Since we first entered the Bahamas, we have invested over $1 billion in developing Atlantis, Paradise Island. This resort includes 2,317 rooms, a marina, a wide range of restaurant, retail, and convention facilities and the world's largest man-made marine habitat. Over the years, we have acquired significant expertise in  operating this business. In fact in 2002, we achieved record results achieving more than $500 million in gross revenue. With the success of Atlantis, Paradise Island our goal has been to extend the Atlantis brand and concept to an ever wider audience. Developing this project in Dubai is this next step. With its year-round warm weather, great beaches, excellent infrastructure and unparalleled airlift, Dubai is the ideal location for our second Atlantis. We have some unique development ideas for the water theme park that will be the centerpiece of this new project and will cater to all hotel guests and Dubai's residents and visitors."

Architectural and conceptual planning is under way for Atlantis, The Palm. Construction is expected to commence before the end of 2004 and it is anticipated that the project will be completed by 2007. The first phase of Atlantis, The Palm is expected to include:

· A 1,000 room luxury hotel, that will have impressive views of Atlantis, The Palm and will have some unusual and distinctive architectural features as is the case at Atlantis, Paradise Island;

· A major water-theme park - the largest in the region, which is day visitor oriented and open to the public for a gate admission - has capacity for over 5,000 visitors daily that will also include one of the world's largest marine habitats, a snorkel trail, a swim with the dolphins encounter program, an array of water slides and The Dig, an Atlantis-themed "archeological" experience;

· An additional 25 acres of land will be reserved for future development.

Butch Kerzner, President of Kerzner International commented, "The story of the development of Dubai's tourism industry has been quite spectacular. We have operated the One&Only Royal Mirage hotel in Dubai since 1999 and recently expanded this resort. This hotel has been extremely successful and we have been able to witness, first hand, the tremendous growth of Dubai as a tourist destination. We have seen the incredible commitment the Government has to developing the country's infrastructure - from its airport and airline to such projects as Internet City, Media City and the recently opened convention facility. Dubai is where East meets West and, with the backing of Emirates Airlines, the potential reach of Atlantis, The Palm is very exciting for us."

The transaction is subject to closing conditions, including the execution of funding for the project.