"This happened to us, even though we are professionals in the field", notes Gilles Hempel, director of the Foundation for Access to Housing (FAL).
In 2021, the FAL purchased nine flats in Mondorf-les-Bains through an off-plan (VEFA) agreement as part of the "Domaine Am Park" real-estate development, units intended for use as social housing.
Five years on, however, construction is still ongoing. The reason: the bankruptcy of Farei Services, the company tasked with carrying out the project.
The foundation had, nonetheless, carried out all the necessary due diligence.
"We vetted the parties we were going to work with. We knew the developer; he was a serious individual with numerous real-estate projects under his belt", explains Tom Nilles, deputy director of the FAL.
That assessment was supported, at least in part, by the company’s longevity, having been registered in the commercial register since 1994.
On that basis, there had been no reason to be suspicious. Nilles notes that the first few months of construction went smoothly.
Everything, he recalls, had been progressing as it should. Then the director of Farei Services fell ill, an illness from which he did not recover.
His son took over in 2023. "That’s when the problems began", Nilles says. The foundation’s leadership describes the subsequent management of the construction site as, to put it mildly, chaotic.
Regular visits had been made to the site to check on the progress of the works, the deputy director added.
It became very clear, very quickly, that the residential complex would not be completed on time.
With construction having begun in October 2020, the developer had been required to complete the project by 15 October 2023, in line with the 36-month deadline set out in the notarised deed.
Delays and a lack of communication prompted the co-owners, the foundation among them, to join forces.
They were not the only ones awaiting the completion of the real-estate project; about a dozen other buyers were also waiting for their units in the development’s second block.
"We purchased a block that includes a commercial space on the ground floor", Hempel explains. Construction was eventually suspended in June 2024, with a planned resumption in September.
The works, however, never restarted, and the developer gradually withdrew into complete silence.
They were not the only ones awaiting the completion of the real-estate project; about a dozen other buyers were also waiting for their units in the development’s second block.
"We purchased a block that includes a commercial space on the ground floor", Hempel explains. Construction was eventually suspended in June 2024, with a planned resumption in September.
The works, however, never restarted, and the developer gradually withdrew into complete silence.
In late 2024, the FAL and several other owners issued a formal notice to the company, Farei Services.
Three months later, in March 2025, the company declared bankruptcy. The ordeal, however, was far from over.
The process of invoking the completion guarantee, running expert assessments, and finding a new project manager pushed back the resumption of construction until January 2026.
Then came the unpleasant surprises. "Through the expert assessment, we discovered that we had paid instalments for work that was never actually carried out", Hempel and Nilles explain.
The sum amounted to €300,000 worth of work, money they are unlikely ever to recover. The completion guarantee, as it stands, does not cover overbilling. It is a classic case of "paying twice for the same thing".
"We still managed to come out of it relatively well", Hempel admits. For a project involving nine flats, the losses could have been far greater, as the accounts of Alejandro, Emily, Damien and Olivier have made clear.
The foundation’s director points out that both he and Nilles have professional backgrounds in the field, and yet this still happened to them.
The reason the project has been able to move forward since is also that the FAL "knows its business" and is "financially robust".
You had, Hempel pointed out, to actually have that €300,000 to hand. An unexpected cost overrun of that order could easily sink a less stable organisation.
Both he and Nilles underline that they visited the construction site many times, verified everything that could be verified, and knew the company in charge of the project.
Even so, that did not shield them from the events that followed.
"It’s impossible to verify everything, some things come down to trust", notes Nilles, citing examples such as electrical wiring or certain façade works that cannot be seen with the naked eye.
That perspective matters at a time when some are looking to hold buyers accountable.
But what is the situation today? Where do things stand on the "Domaine Am Park" project? Fortunately, construction has proceeded without any further hitches since January 2026.
"We should be able to deliver the first units by early 2027", Hempel says. That is good news for the future tenants of these nine flats, as well as for the co-owners of the residence.
The move-in of these first residents will, in turn, allow around ten other households to gain access to social housing.
This article is the fifth in a series about bankruptcies affecting off-plan property purchases. The next report will be published at the end of next week on RTL Infos, RTL Today, and RTL.lu. If you are in a similar situation and would like to be contacted by our journalist, please email rtlinfos@rtl.lu.
