Drunk on Success

Makdeesi Street’s bar scene grows, as do the happy hours and hangovers

"Take me, bring me to Hamra Street, tonight the party’s in Hamra Street,” sang Lebanese Jazz pioneer Khaled el-Habber in years past, and yet nowadays, the tune somehow rings true again. In the past three years, some dozen new restaurants and cafes have opened on Hamra Street and 32 new bars have opened on the parallel Makdessi Street. The impact has been profound, both in terms of its effect on real estate prices and on local Hamra residents, but in terms of crime and violence as well.

Hamra’s roots

The proximity of major universities, and hotels usually preferred by tourists on a budget, has historically given Hamra a reputation for being a laid-back party street. According to Michel Bekhazi, the current mukhtar (or ‘neighborhood administrator’) of Hamra, the 1950s were Hamra’s glory days. Back then, “international celebrities such as Brigitte Bardot and major local celebrities such as Sabah cruised the coffee parlors and theatres there. Opening nights at the Piccadilly Theater were highly anticipated events and one dared not even enter the theater’s street unless decked in their finest attire.” 

Longtime local residents Sami Nasr and Adel Nassar speak of growing up in Hamra in the 1960s and early 1970s when they used to play darts in the Captain’s Cabin with their American and British professors from the American University of Beirut. According to Nasr, “even then, the Hamra crowd was different than anywhere else in Lebanon. There were many foreigners, laid-back foreigners. The older generation mixing with the younger one and all of us having fun together.”  

But the civil war in 1975 replaced the sounds of the Hamra crowd with the sounds of rifles. After the war ended in 1990, according to Bekhazi, “You could count on two hands the number of cars that were seen on the street after 10 p.m.”  Then, in 2005, De Prague, a cross concept between a coffee shop and a bar, opened, and brought more people to Makdessi Street at night. It was followed by Le Rouge restaurant in 2007 and, “people seemed to remember Hamra again, at least for lunch and calm dinners,” says Nasr. 

However, it was the opening of Danny’s pub in 2009 in the Eldorado Alley between Hamra and Makdessi that really heralded the flourish of a new scene. “Before Danny’s, the Eldorado alleyway (next to De Prague), was nothing but a shortcut to Hamra with a little rundown hotel,” says real estate agent Elias Haddad, who has brokered the rent for many of the pubs on Makdessi. “The whole street has changed now, and even that little hotel is going to reopen.”   

On that same alleyway, Cristobal Colon, a restaurant bar, opened later the same year. According to managing partner Toni Rizk, “The alleyway was already showing potential, and we were confident that it was a safe investment to open there.” With their group’s established reputation on Monot Street (with ‘37 degrees’) and Gemmayzeh (with ‘Spoon’), and with Danny’s success, it was vote of confidence for other investors to consider Makdessi. This “vote of confidence” is referred to among economists as the economics of proximity: when a successful establishment causes other establishments to open around it, with the idea that the consumers in search for a certain item will find it easier to head to that area where multiple establishments offer this item. In this case, when one feels like having a drink, one could head to Makdessi and choose from the many pubs there.
The other side

Farther west, in another alleyway that connects Hamra to Makdessi, the situation is similar. Ferdinand opened its doors in January 2009 on an empty road. Ferdinand’s owner Mark Mouraccade says he chose the place because it was cozy and had an open and wide space, just what he was looking for his new concept.  

“Gemmayzeh and Monot had become too saturated, there was a huge reliance on valets, and the rent had become too expensive,” he said. “In Hamra, the rent, and the place itself were just right. In all honesty, we had no guarantees that the location would be appropriate, but we liked that Ferdinand was away from other places, it sort of made its own crowd.”  

Saadi Hakim of Bricks, one of the first establishments on Ferdinand’s end of the street, says that they chose this location because the rent on the De Prague end of Makdessi Street was already on the rise. But three years later, economics of proximity is again filling the area with new bars. Mouraccade does not believe that this is a good thing: “The whole street is now too crowded, rent has almost tripled and valets have been introduced when the beauty of Makdessi was that people walked from pub to pub.”

From a real estate angle, rent has indeed risen significantly. “Before 2009, a 25-square-meter place would cost you $500 in rent per year for the whole place,” says Haddad. “Now, a square meter would cost you between $1,000 and $1,500 per year.”

Mouraccade says that in 2009 rent was $300 per square meter annually, while now in 2012 it is not less that $800 to $1,000. He adds that while rents in Monot and Gemmayzeh took years to reach the heights they are at now, many places in Makdessi are now already starting with those high rents. A local grocery store recently sold out for $65,000 a year in rent, much to the chagrin of his customers. According to the owner, however, had he worked every day of the year, he would not have been able to raise that amount of money. 

This story is not unique in Hamra, and Kamal Jeryes, owner of the gadgets and odd items store “It’s Here”, says he lives in fear of the day he will be evicted and his shop will be turned into the latest pub. His fears may not be that unfounded, according to Haddad, who says that landowners are aware that alcohol sells much more than groceries or clothes ever will, and are willing to pay the high eviction fees for their current renters in order to make double that amount in rent in the years to come. According to Bekhazi, this change is uncontrollable as the money offered is just too tempting for some. Haddad, however, says that some owners are being too greedy and asking for unreasonable fees; he gives the example of the owner of a 30-square-meter, low ceiling supermarket asking $140,000 per year in rent. 

Haddad says that Makdessi is now saturated in terms of stores and that investors are now turning to old houses which they can renovate, like the old mukhtar Rubeiz’s house off Bliss Street, and the current location of February, El Dorado alleyway’s latest addition to the Hamra craze. 

The dark side

As with any concentrated area of pubs in Lebanon, local residents are bound to have issues with the changes in their neighborhood, and it is not unheard of for late-night partygoers to be drenched by a bucket of water tossed from several stories above by local residents unable to sleep. Many Hamra residents, however, seem to take a certain pride in Makdessi’s comeback, as according to Nasr: “We were once young and loud like them, it’s part of the fun in a night out. Besides, even for us, it is nice to have restaurants and cafes so close by, we can enjoy them too.” 

Another complaint cited by many is the issue of security — a concern highlighted last month after one person was wounded in a shooting in Eldorado Alley. According to Beetz’s bartender who has been working the street for some time, “the brawls in Hamra aren’t like your typical bar trouble because they often revolve around politics and comments made from members of different political parties.” 

According to Bekhazi, Makdessi Street has traditionally been the turf of the Syrian Social Nationalist Party (SSNP). When pubs started opening on the street, according to a Hamra pub owner, who wishes to remain anonymous for fear of having his business hurt, owners quickly learned that they had to buy their water reservoirs and electric power from SSNP-approved suppliers. All this was taken in stride by the bar owners at first, after all, such situations exist all over the world.

“It’s all part of the business and they do provide good services with little fuss,” said the source. According to Hakim, the situation escalated when “another local political party” tried to exert dominance on the street, wanting to start their own valet services there. In the meantime, clashes were occurring more frequently all over Makdessi.

Some like Haddad and Mouraccade say such ruckus is natural with the cheap and early ‘happy hours’, and so many students are drunk before dark. There are rumors, however, that the Amal Movement is looking to cause trouble for the SSNP on the street. Bekhazi confirmed that both parties were engaged in an altercation and spoke of how he was asked to intervene in a physical dispute between “local boys from the SSNP and Amal. I don’t usually interfere in such issues, but they are our boys.” 

The situation was dealt with quickly and SSNP now charges each bar $600 per month for ‘security services’. They have also started their own valet parking service at the beginning of Makdessi, according to the anonymous pub owner. The SSNP refuted any such claims, saying that it happened sometimes that a person hired for security purposes is an SSNP member, but that is merely a coincidence. A spokesperson for the SSNP also denied that there were ever any issues with the Amal Movement.

What’s next on tap

Forecasts regarding the future of Makdessi differ. Brick’s Hakim said that opportunist amatuer investments might be bitting off more than they can chew. “They miscalculated how much profit they can make, and are now being forced to shut down as they can’t afford the rent anymore. These turnovers will necessarily bring the rent down, which is good news for the more serious investors waiting to grow in Hamra,” he said. 

Mouraccade also believes Makdessi Street is in a period where these “amateurs” are somehow causing harm to the more serious establishments, through the customers they attract and their ways of competing, such as cherry-picking staff with offers of higher wages. He contends that in the long run, these pubs will be unable to keep up with the rent — especially with their higher staff costs — and will have to shut down eventually.

Haddad does not see rents dropping soon, saying that as long as there is high demand, costs will remain high. According to him, actual physical space in Makdessi is becoming a rare commodity but the turnover of the already opened bars keeps the investors interested. 

Whichever way the market goes, it is clear that the changes in Hamra are continuing. The neighborhood is singing a new tune at night — one that goes on well into the morning.

Nabila Rahhal

Nabila is Executive's hospitality, tourism and retail editor. She also covers other topics she's interested in such as education and mental health. Prior to joining Executive, she worked as a teacher for eight years in Beirut. Nabila holds a Masters in Educational Psychology from the American University of Beirut.