lo sept 2009 ok

COVER STORYFOCUS

n 66 n LEBANON OPPORTUNITIES, SEPTEMBER 2009

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Trend settersInstitutionalized developerstower over the property market

Trend settersInstitutionalized developerstower over the property market

CoverStory-FOCUS - Sep 09 8/29/09 11:58 AM Page 2

LEBANON OPPORTUNITIES, SEPTEMBER 2009 n 67 n

finance are becoming blurred. Real estate isbecoming a money matter – not aboutconstruction, not about development, notabout urban planning, but simply about IRR(or the internal rate of return made on agiven investment). With average priceincreases estimated at around 30 percent ayear over the past several years, and a realestate market that has proven to retain itsvalue – and indeed continues to grow – inspite of security shocks, political instability,and the uncertainty to which the economyhas been subjected, investment in local realestate is a vastly lucrative business. Yieldson the most aggressive stocks rarely reachsuch high returns, and if they do, they arecertainly never as secure. Jamil IbrahimEstablishment, probably the largestdeveloper in terms of turnover, currently isexecuting eight simultaneous projectsamounting to a total between $700 millionand $800 million. Although developers areextremely reticent about revealing profitmargins or IRR figures, it is commonlycirculated in the industry that profitmargins in the high-end market bracketreached as high as 60 percent in 2008.

ATTRACTING THE CASHRight now, it looks like the perfect match:Real estate requires huge sums of money tostart up profitable projects, while local banksare threatened by drowning in their ownliquidity. (See article on page 47) “Thecurrent excess liquidity that banks have ontheir hands could be much better employed ifinvested in real estate,” Abou Jaoude said.With access to high-net-worth individualslooking for safe investment alternatives fortheir cash, banks can bring their own as wellas their customers’ money into the local realestate market. With hundreds of millions ofdollars to invest, banks naturally prefer totake a direct role in managing their realestate portfolios. Real estate affiliates orsister companies have cropped up in manymajor banks, such as CGI at the Audi SaradarGroup and FFA Real Estate at FFA PrivateBank. For real estate bankers Abou Jaoudeand Farkouh, it is only a matter of time beforemore and more banks jump on the real estatebandwagon, either by establishing their ownreal estate subsidiary or by joining forceswith large, established real estate developersand contractors. “Banking groups have thefurther advantage of reassuring bothinvestors and clients, as they representfinancial solidity and transparency in theirdealings,” said Farkouh.

R eal estate developers are growing aslarge as the towers they build. In the1950s, state-of-the-art developments

such as the Starco Towers and the PhoeniciaHotel stood as testament to the advancementof local real estate development. With thestock market having again proven to be ahighly volatile investment vehicle, thetangible reality of real estate has rapidlygrown as an attractive option for big money,particularly for local banks flush with recentinflows of cash deposits.

BIG MARGINSThe main reason big developers arebecoming larger and larger lies in the issueof financing. “Only five years ago, land inprime locations used to cost around $3,000per square meter. Now it is between $15,000and $20,000 per square meter,” said KarimIbrahim, sales and marketing manager oflocal mega-developer Jamil IbrahimEstablishment. For a normal plot size of5,000 square meters, this represents acolossal initial investment of between $75million and $100 million. The stakes are sohigh that only the most financially sturdyinvestors can afford such a capital outlay. “Ithas become too capital consuming for smalldevelopment companies or individualdevelopers to operate, particularly in primelocations,” said Aboudi Farkouh, assistantgeneral manager of CGI, Audi SaradarGroup’s real estate arm. In prime locations,where the cost of the land amounts to such alarge share of the total investment, itbecomes financially unviable to buildanything but the largest projects. The highcost of land requires that large-scale,sophisticated, top-of-the-line projects bedeveloped, to optimize returns oninvestment, as high-end projects yield largerprofit margins. The more the project costs,the more organized and affluent thedeveloper must be.

SOMETHING SOLIDIn a general international climate of distrustand confusion, where the preferred mediumof investment – the stock market – hasproven more volatile than gas, the local realestate market in particular has become anextremely attractive investment option.“Real estate is a good investment optionbecause people can ‘touch’ their investment.In the worst-case scenario, they still havethe ownership deed,” said Georges AbouJaoude, CEO of FFA Real Estate. More andmore, the lines between real estate and

There are two types of realestate developers: Highlyorganized, institutionalizeddevelopers undertakinglarge-scale, upper-endmarket projects, andtraditional constructioncompanies focused onmiddle- to low-incomehousing. For decadesinstitutionalized developerswere absent from the localreal estate market. Today,with land prices more thanquadrupling over the pastfive years, an average realestate development of 5,000square meters requires upto a $100 millioninvestment, meaning small-and medium-sizeddevelopers are mostlypriced out of the market.


BIG STABILITYThe effects of such developers on the realestate market are immediate and palpable.According to Abou Jaoude, institutionalizedreal estate developers lead to stability inprices. “Because projects created, executed,

and promoted by professionalreal estate developers areexpected to make a specifiedreturn, prices will remainstable throughout the life ofthe project,” he said. Withstudies made before projectsare launched about how muchIRR investors should expect ontheir money, prices will befixed at whatever levelachieves this return. Unlikesmaller development or

contracting companies, large developers arenot tempted to increase their prices with everysuccessful sale they achieve. Being highlystructured and obeying strict financialregulations and monitoring, real estatedevelopment companies tend to offer morestable prices. “Banks and investmentcompanies are playing a role in keeping non-professionals out of the real estate market,”said Mouawad. This is another indirect benefitinstitutionalized real estate companies bring,simply by making it harder for non-professionals to compete in a market that isvery well studied and extremely well planned.

big local developers. “The local market hasof late become much more open to foreigninvestors and foreign buyers,” said Bassil.To invest in an economy perceived as beinghighly volatile, foreign investors as well asforeign clients value the guarantee of aprofessional, organized, andestablished developer.International investors alsocome with expectationsabout what a real estatedeveloper should be able tooffer. “The model has beenproven viable. It has beentried and tested globally,”said Farkouh. The entry ofinternational investors,attracted by a solid local realestate market that is stillunderdeveloped, is reshaping the profile oflocal development companies. “Many localcontractors are currently growing intoinstitutionalized developers by establishingjoint ventures with internationaldevelopers that possess the know-how,”said Joseph Mouawad, chairman ofMouawad Projects. Mouawad believes thatit was the arrival of Solidere on the realestate market that prompted the growth ofprofessional developers locally. “Solidereset precedents in standards, planning, andexecution that have forged a trend for otherdevelopers to follow,” he said.

COVER STORYFOCUS

ECONOMIES OF SCALEThe single biggest added-value a structureddeveloper has over its contractorcounterpart is the organization of thebuilding process. “Having the financial anddevelopment sides of the operation underone roof helps in optimizing cash flows,”said Abou Jaoude. A structureddevelopment company offers checks andbalances that a smaller entity would nothave. Karim Bassil, CEO of BREIdevelopment company, believes that astructured development entity producesbetter quality work because of the internalchecks and balances among its differentdepartments and because of quality controlat every phase of the development process.“There was a time when my father managedeverything from plan development toconstruction site, but for one person to runour current several-hundred-million-dollarbusiness alone would be unthinkable,” saidIbrahim. The size of the projects dictatesthat a large structure be put in place tomanage the complex work flow. In turn,because work becomes better organized andmore systematic, it inevitably results inhigher quality end products.

INTERNATIONAL PLAYERSThe entry into the market of internationalplayers, both investors and buyers, hasspurred the emergence and development of


The entry ofinternationalinvestors is

reshaping theprofile of local

companies


more popular suburbs,” said Farkouh.Professional developers are more aboutsize than subject matter.

HERE TO STAYWhile not new to the market, professionaldevelopers are becoming more numerous,bigger, and better organized. The scale ofsome projects are reminiscent of Dubai –Sama Beirut, for instance, is the first tower ofits size in the country and BeitMisk is thelargest gated community project in thecountry. (See article on page 80) In a countrywhere land is becoming more and morescarce, where demand for housing is everpressing, and where prices attract ever moreinvestors, large-scale developments seem tobe the inevitable trend. And large-scaledevelopments require the existence of largescale, professional, institutionalizeddevelopers. “Structured developmentcompanies are here to stay,” said Mouawad.The major advantage these entities have overtraditional contractors is their ability toforecast the market. “The job of a professionaldeveloper is to see what is missing in an areaand complement it,” said Bassil. Developersstudy demand trends, look at the availablesupply, and study what the market will bemissing over the next few years. And that’swhat they will develop. So what is coming nexton the agendas of the mega-developers in

town? Real estate projectswith an added-value: “Touristprojects are sorely needed, asare projects coupled withservice-oriented industries,such as wellness, hospitality,and so on,” said Abou Jaoude.Mouawad’s firm is planning

along similar lines, with more hotels in itsconstruction pipeline. The hard-core realtorswill continue to provide high-quality,residential projects, as is the case with JamilIbrahim. Whichever type of projectsdevelopers dream up next, though, they aremost certainly likely to keep growing in bothsize and budget.

Reported by Soha Yammine

Bassil. Abou Jaoude agrees: “The projectmust be large enough and profitableenough to ensure that the developer(effectively the middle man in theconstruction process between investorsand buyers) makes enough profits torender the whole enterpriseworth his while,” he said.With a market segregatedbetween a high-enddeveloper and a middle- tolow-end local contractor,critics could accuse bigdevelopers of buildinghousing only for the rich, meaning that theless well-off never benefit from theimproved standards big developers mighthave brought to their end of the market.But this is the natural course of theeconomic survival of the fittest.Institutionalized developers are betteradapted to deal with large-scale projects inup-scale locations, while local contractors,with a lower overhead, are ideal forcompeting in the middle- and low-end ofthe market, where every dollar saved is adollar gained. The divide may also not be soclearly cut between the two markets.“More and more projects of somemagnitude may require the services of aprofessional, institutionalized developer,be it a glitzy project in a chic part of town ormiddle-income housing apartments in the

NOT SO NIMBLEThere are other effects institutionalizeddevelopers bring to the market that may notbe so well regarded. With longer time lagsbetween decision taking and execution, bigdevelopers may reach the phase ofimplementing a project at a time when themarket is registering a slowdown. Also,some experts believe that because realestate developers are financially more solid(and often have the backing of a bank oranother financial institution) they may beprone to taking more risks than anindividual developer would on his own.Bassil seems to agree. “It’s developers with aconviction who would last on the market.Investors may make fast money, but it’s onlyin the immediate term,” he said.

MARKET DIVIDEAnother indirect effect of big developers isto divide the real estate market betweenhigh-end and lower. Because developingprime land in hot-spot areas representsmore attractive profits, institutionalizeddevelopers may become exclusivelyinterested in developing prime projects forthe upper-end market. “Being such astructured entity usually means higheroverheads, which may renderinstitutionalized developers too expensivea business to operate in the more price-sensitive middle- to low-end markets,” said


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Professionaldevelopers are

more about size


W ith a non-assuming air, Karim Bassil, CEO of BREI Real EstateDevelopers, is nonetheless putting his stamp on the

neighborhoods in which he builds. “We are interested insupplementing the types of projects that are missing in aneighborhood,” said Bassil. His ideal is to determine what is lacking ina neighborhood to make it more lively, more complete. BREI’s projectsblend into their surroundings. They still stand out by their aesthetics,their simplicity, and the quality of their finishing. They look like thesurrounding buildings surrounding them – but with something extra,

a flair of refinement and modernized traditionalism. The conceptunderlying BREI’s projects is perfectly illustrated by the repetitivenames they all carry: Convivium. Bassil’s idea of creating convivialityin a neighborhood is what makes him the visionary who first sees theunexploited potential of a given area. “I don’t mind developing aproject in an area to liven it up and have other developers follow,” saidhe. Running a small but highly professional team of ten, Bassil hascreated a perfectly oiled machine of business development, sales andmarketing, administration, and finance.

SELECTED PROJECTSn The six Convivium projects, of which Convivium I, II, III, and IV

have been completed and VI and VII are still under constructionreach a total value of $90 million and a total built-up area of morethan 65,000 m2

n Convivium VI is a four-building, serviced, residential project inGemayzeh, consisting of 86 units ranging from 40 m2studios to400 m2 apartments. It is scheduled to be completed in 2011.

n Convivium VII is a two-building residential project in Badaro witha 120-meter-long private garden. Its 33 apartments are allarranged into 200- to 300 m2 lofts and penthouses.

n Edelweiss is the apple of BREI’s development eye. The purpose ofthe project is to supplement Faqra Club with what it was missing– a community center, a heart. Launched in May 2009, Edelweissis a colossal $100 million development, comprising 300 smallchalets and commercial space (including exclusive boutiques,cafés, and restaurants), all built with a conscience for beingenvironmentally friendly. It has started sales at $3,500/m2 andhas increased since, with an eye to reach $6,000/m2

COVER STORY10 TREND-SETTING DEVELOPERS


E stablished in 1989, CGI, which is the acronym of French Conseilet Gestion Immobilier, is one of the earliest institutionalized

real estate development companies in the country. Affiliated to AudiSaradar Group, CGI benefits from the bank’s large network of high-net-worth individuals and affluent customers. The company is, inthat sense, ideally placed to bring together investors in and buyers oftop-of-the-line real estate projects. Although it has developed,financed, and managed five projects since its inception, CGI is one ofthe largest real estate players in its niche market, estimated to holdabout 40 percent of the total built-up area in the high-end market ofAshrafieh and Gemayzeh. Indeed, CGI’s projects may be few, butimposingly large, they certainly are. The development company’sspecial cachet lies in putting on the market products of extremelyhigh quality, in the heart of Ashrafieh, targeting a high net-worth,sophisticated, and very demanding high-end clientele. CGI has so farconstructed five projects with a total built-up area of 120,000 m2, fora total expected sales value of $515 million. In order to ensure thatthese funds are properly managed, CGI closely supervises the entireimplementation process of the projects it develops – from theirdesign stage through to the delivery of the last unit.

SELECTED PROJECTSn Begun in early 2000, Ashrafieh 784 is CGI’s first completed

project. The 15,000 m2, mixed-use real estate project achieved atotal sales value of $15 million.

n Hugo 43, the company’ssecond project launched in2003, is soon to be completed.With a total built-up area of20,000 m2, the project had atotal sales value of $40 million.

n Gemayzeh Village is a colossaldevelopment covering an areaof 75,000 m2. The luxuriousresidential ‘village’ waslaunched in 2005. Excavationsare expected to start in abouttwo months and already 45percent of the project has beensold. Gemayzeh Village isexpected to reap a whopping$230 million in total sales value.

n Ultra-modern Marfaa’ 1474 is a 15,000 m2 mixed-use projectlaunched in 2005 and expected to be completed in four years, foran estimated sales value of $60 million.

n CGI’s most impressive development is the Abdel Wahab 618 twintower project that will be a 50,000 m2 residential complex justtwo minutes away from Sassine Square and ABC Mall. It isexpected to bring in the huge sum of $170 million, of which halfhas already been sold.

CGI – AUDI SARADAR GROUP

Aboudi Farkouh, AGM of CGI

BREI

CoverStory - TOP 10 8/29/09 7:22 PM Page 2



FFA is first and foremost aprivate investment bank.

Georges Abou Jaoude, generalmanager of FFA Real Estate,still thinks of himself as afinancial guru. “Real estatewas a derivative job from thepure, hard-core, financialinvestment heart of ouroriginal business,” AbouJaoude said. Abou Jaoudefirst dabbled into real estatewhen it became an obvious,viable, highly lucrativeinvestment option for thebank’s private investmentclients. Their first project, Foch 94, was sub-contracted to anindependent contractor. “We simply acted as the financial controllerson the project,” said Abou Jaoude. The weakness in the system wasthat there was often a problem of communication between thedevelopment and financial sides of the business, which each had itsown set of conflicting priorities. The group found it made bettersense to control the full process, and slowly FFA developed a fully-fledged development entity. Originally set up in 2004 as a division ofFFA Private Bank, FFA Real Estate was recently established as aseparate entity and is currently involved in five projects, which will

cost near $250 million. FFA Real Estate is the first developer on thelocal market to have obtained LEED certification for its projects. “Weplan to make all our future projects environmentally friendly butadhering to LEED requirements,” said Abou Jaoude. Beingenvironmentally friendly is taken to its logical extreme – noisepollution from water pipes, to light pollution flooding the bedrooms,parking spaces for bicycles, and renewable energy are all carefullystudied, planned, and implemented.

SELECTED PROJECTSn FFA Real Estate will soon be handing over its first project

launched in 2005, Foch 94. The project, costing close to $30million is an eight-storey residential building, consisting of fiveduplexes and two penthouses, ranging between 250 m2 and 800 m2.

n Marfa 94 was undertaken with Hourie Development for a cost of$60 million, but has since exited the project, which is due forcompletion in 2012.

n Badaro Gardens is a residential project that was completelydeveloped, designed, and implemented by FFA Real Estate. It isthe first LEED-certified residential building in the country andhas set the bar very high for other projects (including future FFAprojects) to follow.

n FFA is also taking a new concept to new heights – that of the gatedcommunity. Its $60 million Ahlam Resort project in Kfarzebiancovers an area of 1.96 million m2. It will include 900,000 m2 ofresidential space, an 18-hole golf course, a polo club, a golfacademy, a 40-suite boutique hotel, a club house, a health farm,and a spa. Ahlam Resort is expected to bring in $144.5 million inrevenues, which translates in a profit margin of 240 percent.

FFA REAL ESTATE

Chawki Farhat identifies market trends and tries to be a few yearsahead. By his own confession, Farhat has an eye for finding the right

location. “The location determines all the rest: The size, the budget, theprofile of the client,” he said. And deciding on what project to develop onwhat plot allows for no mistakes. It takes long years of experience to reachsuch a confidence level, but a presence of nearly 40 years on the markethas given Farhat that know-how. His first project was a brilliantinnovation in real estate for its time. “In 1977, we built Solemar, the firstproject to offer chalets for sale in the country,” said Farhat. Becoming ahuge success, spurred in part by the affluence of families escaping thethen-warring areas of town, Solemar gave Farhat a sturdy reputation. Itwas also a challenging first project to implement, with its 500 chalets,totaling approximately 30,000 m2 of development area. His nextinnovation came in the 1980’s in the shape of an industrial complex inJdeideh. Four blocks counting 16 levels each are all accessible to trucks, afeat rarely achieved in the country. In the 1990’s, forecasting a massivereturn to Ashrafieh by the inhabitants that had left during the war,Farhat took up building residential apartments. The idea was again ahuge success. Farhat starts selling his projects before floor plans are evendrawn and usually sells 100 percent of the project before works arefinished. For the next few years, Farhat continues to see potential growthin that same market. “The area has not yet reached saturation point anddemand is still very strong,” he said. So, until he identifies a new need,Farhat will continue providing high-quality buildings to an avid audience,mostly concentrated around Ashrafieh, Gemayzeh, and Saifi.

SELECTED PROJECTSn Projects nearing completion include: Residence 683 in Furn el

Hayek, Residence 700 on Abdel Wahab Streets, Residence 273 inGemayzeh, and Residence 1274 in Ashrafieh. All these buildingshave apartments occupying an entire floor and measuring 300-355 m2.

n Excavation and shoring works have started on a 15-storey towerin Siafi, Residence 237. 35 percent of the apartments have alreadybeen sold, despite the fact that it will take three and a half years tocomplete. Apartment sizes are 270-550 m2.

n Three more projects are in the pipeline, awaiting constructionpermits. They include a 15-storey tower along Zahret el EhsanStreet in Ashrafieh, and another 14-story tower along CharlesMalek Boulevard. Apartments in these buildings measurebetween 300-380m2 with a high quality luxury finishing.

CHAWKI FARHAT OFFICE



A t the age of 41, multi-billionaire Bahaa Rafic Hariri has decidedto step away from Oger Telecom, the Saudi-based

telecommunication and development firm at the heart of the Haririfortune, to turn to his own projects. He founded in 2002 HorizonDevelopment Holding to instigate large-scale, upper-end real estatedevelopment projects, both here and abroad, that are likely to changethe landscape of their surrounding neighborhoods. The Horizonprojects are some of the largest to ever be implemented in the country.

Although works have beenconsiderably slowed downover the last few years due tothe instability in the situationhere – but also due to Hariri’sinterest being engagedelsewhere in multi-billion-dollar investments, such asthe $3 billion Abdali projectplanned for Jordan, Horizonstill holds the record in sheersize and scale of projects underconstruction in the city. Aseries of projects are in storefor Verdun and one inRaouche. They all are puttingon the local market huge

projects more reminiscent of the colossal Gulf developments. Thedrawings of these projects are enticing. But to get a real look, one hasto wait for the construction phase to be completed.

SELECTED PROJECTSn Verdun Gardens, also called V2, has already broken ground on the

corner plot behind the Bristol Hotel, across the street from theDruze Foundation center. The project’s total land surface area isof 7,000 m2 but it will result in a total built-up area of 66,000 m2.The projects two residential towers will house a shoppingcomplex, keeping in tradition with the area in which it is located.The project is estimated to cost a total of $40 million.

n Place Verdun (also known as V5) is an even more impressivemulti-purpose development, totaling a built-up area of about150,000 m2 on an 18,000 m2 plot of land, and an estimatedconstruction cost of $200 million. Horizon hopes V5 will becomeone of the main shopping attractions in town. In addition to itsluxury, 20-storey residential tower, the complex is planned toinclude a 6,000 m2 department store, a 12-screen Cineplex,upscale and mid-market fashion and apparel shops, food andbeverage outlets, in addition to a possible ice skating rink.

n For its plot of land along Raouche, Horizon was at first planning afive-star hotel development. Plans have changed, however, andthe development is in the process of being turned into aresidential complex, but still in its very early development stage.

HORIZON DEVELOPMENT HOLDING


Everything built by JamilIbrahim Establishment finds

a taker, before ground-breakingbegins, before constructionpermits are obtained, andsometimes, even before floorplans have been finalized. It’sbecause one of the oldestdevelopment companies in thecountry has earned a reputationfor delivering quality and keepingits commitments. Jamil Ibrahim,founder of Jamil IbrahimEstablishment, finishedconstructing his first building in1961. But a brick at a time, this construction company that used to berun single-handedly by its founder, has turned into a multi-million-dollar mega-development institution. It used to take Ibrahim abouttwo years to develop a building of 11 300-square-meter apartmentsfor a total cost of about $30 million. The company now manages torun eight mega-projects concurrently, for a total investment of about$800 million. Just one of the projects counts on its own 64 units of685 square meters each. Just the land of the newest project, LaCitadelle de Beyrouth, near the Vendome Hotel, costs $130 million.To be able to keep up with the vertiginous growth of his business,Ibrahim started delegating. What started out as a small enterprise of

five employees now runs an army of 100, divided into three maindepartments, each run by one of Ibrahim’s three sons: One brotherhandles purchasing, another follows up on-site works (assisted by 25full-time, in-house engineers), and the third is in charge of sales andmarketing. The super-structure of this super-developer is sturdyenough to allow them to take more and more work internally. Thesecond biggest expense center after the cost of land, namely concrete,is being handled directly by the company since 2004 – for bettercontrol of quality, better management of time, and better savings.Jamil Ibrahim Establishment is living proof that delivering a high-quality product consistently is an assured formula for long-termsuccess. The company has signed its name on more than 100residential projects and a number of large scale commercial centers,mixed-use developments, and manufacturing plants.

SELECTED PROJECTSn Jamil Ibrahim is in the finishing phase of three projects, Sky House,

Astoria, and Dream Bay, all luxury apartment buildings in primelocations in Beirut.

n Three more high-end residential projects are currently underconstruction: Raouche Residence, Les Domes de Sursock, andthe Carlton.

n Jamil Ibrahim is preparing the launching of two more projects inthe very near future, both of which will be high-end residentialprojects. La Citadelle de Beyrouth, and the other still doesn’t havea name, but will be located near the Riviera Hotel.

JAMIL IBRAHIM ESTABLISHMENT




Location, location, location. The oldest adage of real estate seemswhat guides Nabil Sawabini, founder and chairman of MENA Capi-

tal which has selected landmarks in the capital for some of its toweringprojects, including a domineering structure next door to the historicSursock museum, a project that earned its developer more than thehabitual amount of headache and controversy. With projects wortharound $400 million since the company’s inception only five years ago,in 2004, sales this year alone are expected to be nearing the $100 million.It is by sharply differentiating itself from others that MENA Capital hasbeen able to achieve these figures. MENA Capital has built a reputationfor putting on the market highly conceptualized designs, such as theiraward-winning flagship project, Sky Gate – a glistering tower of glassthat gives the impression of being built out of the surrounding air. MENACapital is now adding a fifth dimension to their projects: The luxury ofvolume and space. “Our new high-end projects have ceilings 3.5 metershigh, and some offer ceilings of 5.5 and six meters,” said Sawabini.Backed by the strength of its developments, MENA Capital has gainedthe trust of some of the old, land-owning families of the city (the Sur-socks and Hochars, for example), who now established partnershipswith the company. Their contribution is in their stock of land plots.“This is where our strength lies – in identifying the opportunities and incoming up with the financial structure to see them through,” saidSawabini. Coming up over the next few months are three projects, ofwhich Sawabini is very proud. The first is a residential project withsmaller units targeting mostly expatriates wanting a pied-à-terre backhome and young, local executives. “I’m very excited about the concept

and the design of this communi-ty project,” said Sawabini, with-out revealing more details. Thesecond is a resort. The thirdremains a surprise. “Discretionearned MENA Capital the trustof its investors and clients,”said Sawabini. The secrecy isprobably also a way to remainahead of competitors.

SELECTED PROJECTSn Qoreitem Gardens is a 15-storey residential tower that has the

genius of offering units 350-713 m2. The tower, to be delivered end2010, will include a gymnasium and ample parking.

n Sursock Residences is a striking project. The two towers (of 20 and24 floors respectively) will house luxury simplexes of 385 m2 and539 m2, and 655 m2 duplexes.

n Hochar Tower is situated at close proximity to the AmericanUniversity of Beirut (AUB). The 17-storey tower was elevated onpillars to accommodate 1,000 square meters of landscapedgardens and will be topped by 1,000-square-meter penthouses,each with its private terrace garden and swimming pool.

n The most eye-popping of MENA Capital’s creations must be SkyGate, a high-end, 40-storey residential tower that will be built onthe highest point in Ashrafieh. Designed by renowned ArchitectNabil Gholam, the tower is set to be completed by the end of 2012.Apartment sizes vary between 325-750 m2. The crown jewel is apenthouse measuring 1,484 m2.

MENA CAPITAL

Joseph Mouawad, chairman of real estate developer MouawadInvestment Group (MIG), has the vision that comes from being

born into a long tradition in the business of construction. Mouawad ismore than just a builder of homes – he is a creator of the landscapes ofthe future. Mouawad considers that real estate development resides inunderstanding what the market’s future needs are going to be to beable to be ready to answer those needs when the time comes. Buildingtakes time – at least two to three years for a relatively small-scaleproject. Any time a developer starts planning a project, he is actuallydrawing the future. “Our job is primarily to determine what the futureof development should be,” said Mouawad. It is not enough to follow atrend and keep supplying the market with what it is currently askingfor. Mouawad’s most interesting job is in creating that future need,based on an assessment of the direction the present market is taking.Moving from purely residential real estate, Mouawad foresees a needin commercial space, particularly for hospitality and recreationalfacilities. The company’s present shift in interest to hotels and resortsreflects that belief. With a highly creative, leadership role in themarket, Mouawad Investment Group has already achieved $300million in profits and 300 percent growth since its inception in 1996.

SELECTED PROJECTSn MIG has invested more than $10 million in two completed

residential projects, Parc Jadev and Primavera, totaling a jointbuilt-up area of 25,000 m2

n Its residential projectscurrently under way are ThePavilions in Wadi Abou Jmil,covering 18,000 m2 of area, witha total value of $40 million.

n Capital Gardens in Minet elHosn (10,000 m2) and SaifiPearl (17,000 m2) each costsaround $20 million.

n MIG has been moving intocommercial projects, detecting aneed in that niche market. Its new project in Solidere, The Palladium,is a 14,000 m2-BUA, mixed-use complex for a total value of $20 million.

n But some of MIG’s most memorable projects are commercialbuildings, such as Bourj el Ghazal, The Atrium Building, ParkTower Hotel, and Saifi Suites Hotel.

n To Mouawad, the future of real estate lies in hospitality.Oakridge, a mountain resort located in Faqra-Kfarzebian, willhave a vast built-up area of 46,000 m2, at an approximate cost of$100 million. This luxury private community resort will put 77units on the market, consisting of residences, condominiums,town houses, villas, and a lodge, to be delivered by 2012.

n Silver Rocks, a land development project is another venture (butstill hush-hush) in Faqra that will be completed in 2013, with atotal built-up are of 36,000 m2.

MOUAWAD INVESTMENT GROUP



Solidere has reshaped the face of Beirut. It is the largest-scaleurban development project the country has ever seen, on a site

most laden with historical and emotional meaning – the heart ofBeirut, el Aswak. By renovated the raised city center, returning someof its landmarks to their original state and creating some completelynew ones, Solidere is recreating an identity for the Beirut of thefuture. It is a perfect blend between the old and the new, thetraditional and the starkly modern. Sprawled on a stretch of 1.9million m2, out of which 700,000 are being reclaimed from the sea,

Solidere has taken on a project ofhuge proportions – and brought itto successful fruition. Through allthe ups and downs the countryperiodically goes through,Solidere has been moving on withits development plan. It is aboutto start infrastructure works onthe reclamation area, which willboast a splendid esplanadestretching the whole length of theseashore. The Beirut Souks areprobably Solidere’s most daringdevelopments, as they are aperfect example of bridging thepast to the future. Top-of-the-linequality in one the city’s most

refined settings is what has attracted the biggest internationalbrand names to the Souks. With more projects in the pipeline andwith a hawk-eye control over developers building within itsperimeters, Solidere has not only rekindled the heart of Beirut, it hasalso played a major role in the bringing the local real estate marketup to par with international standards by introducing state-of-the-art practices and quality.

SELECTED PROJECTSn In the landfill area, the new waterfront district, Solidere is

planning residential and business spaces and two marinas (withthe capacity to receive 1,000 boats), a 70,000 m2 public garden, anda seaside promenade. The total BUA for the project is planned at 1.7million m2 with delivery to investors by 2011.

n Solidere is currently executing the Beirut Souks project, whichwill have 163,010 m2 of floor space interspersed among 17,307 m2

of landscaped pedestrian areas. The Beirut Souks will host morethan 200 commercial outlets, offices, department stores, goldsouks, a leisure and entertainment center with 14 movie theatres,and a large food court.

n The South Souks, scheduled for completion later this year, willcover a site measuring 30,000 m2 and a total BUA of 71,903 m2. Itwill have 66,207 m2 of floor space and will encompass a gold souk,which will have 15,989 m2 of floor space.

n Facing the hotels district, Solidere also started work on a majortourist project on the Western Marina quayside, comprising 100luxurious chalets, a yachting club, and other sporting facilities.Overlooking the marina, and adjacent to the public park, will behigh end shops and world-famous restaurants and cafés.

SOLIDERE

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lo sept 2009 ok

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