Nestled amid pine trees in the Naas area of Bikfaya in Mount Lebanon, sits an old abandoned factory in which Lebanon’s cleanest and healthiest mineral water used to be bottled.
Today, all that is left is a small spring running straight from the mountain through three small taps.
But this is soon to change. FFA Real Estate, the fully owned subsidiary of FFA Private Bank, has a four-year plan to turn the factory into a luxurious wellness resort, surrounded by signature villas, bungalows and a five-star hotel. The estimated development cost is $60 million, and construction is set to begin by the end of this year.
A touch of history
The water source was discovered in 1917 by the landowners, the Majdalani family. In 1933, the family was granted a license to build and operate a bottling plant, and opened their business shortly after.
In 1939, the factory halted operations because of World War II, not to open again until the early 1970s, when the Naas Bikfaya Mineral Water Company was formed by a presidential decree. The business operated as a joint stock company and was traded on the Beirut Stock Exchange.
In 1986, however, production stopped again due to the Lebanese Civil War, when the factory was used as a Lebanese Army base. The factory has not reopened since.
Healthcare and water
FFA Real Estate wants to capitalize on the rare properties of Naas mineral water, which — after having done comparative studies with local and foreign bottled mineral waters — proved to be the least mineralized in Lebanon and can compete with the well-known water brands across the globe, such as Evian and Vittel. Julien Khabbaz, manager at FFA Real Estate, explained that Naas water helps flush kidney stones because of its low mineral content and is good for bathing because of its high sulfate level.
“We are still conducting research on the water,” he said. “We are going to integrate this spring water into the spa, creating a holistic experience where people can drink the water and bathe in it.”
In October of last year, FFA Private Bank announced the acquisition of 86 percent of the Naas Bikfaya Mineral Water Company through a private placement, at $0.93 per share. Georges Abou Jaoude, general manager of FFA Private Bank, said the bank currently owns 91 percent of the company after acquiring additional shares. Most of the shares had been owned by the Majdalani family, of whom Roy Majdalani still holds the remaining shares and will chair the company.
“He stayed in as chairman and he is helping us on a daily basis to acquire more shares, partner with the neighbors and enhance the whole project,” said Abou Jaoude.
He explained that FFA Private bank met with the Majdalani family in 2008, but did not decide to buy shares and start the project until the bank saw stability in the tourism and real estate markets in 2009.
Abou Jaoude explained that in December 2010 or January 2011, Naas Bikfaya Mineral Water Company will be listed once more on the Beirut Stock Exchange with a new initial public offering (IPO) to raise capital for the project, with shares offered at between $1.25 and $1.30 each.
The initial plan was designed on a 46,500 square meter plot, but has since seen 5,000 more square meters added from a neighboring property through a joint-development agreement, and is likely to be expanded further.
“We are trying to talk to everyone to see how [our neighbors] can be integrated through joint developments…anything that would help the area overall,” said Khabbaz.
According to the preliminary concept, the Naas resort will include a wellness center (the restored old factory), a 60-room luxury hotel, 25 bungalows and 10 residential villas.
While the blueprints of the project have yet to be finalized, the initial architectural design was created in collaboration with three architects: Guillaume Credoz, director at the French Ateliers U, Ayssar Arida, the founder of the London-based Q-dar, and Guerric Péré, president of the France-based Ilex Paysages.
The resort operators have yet to be chosen; Abou Jaoude added that FFA are looking at some 20 operators in order to choose the best one.
“We think we will have a clear view on operators, architects and financing within the next 3 months,” he said.
Since the factory has not been operational since 1986, its infrastructure is damaged and FFA Real Estate is going to rebuild it entirely, in compliance with Leadership in Energy and Environmental Design (LEED) standards.
“New infrastructure, new sewage systems and a new electricity grid will all be done again,” said Abou Jaoude.
The project will be financed from three sources: new subsidized loans from the central bank for the tourism and environmental sectors, the pre-sale of the signature villas, and the equity that will be raised from the eventual IPO on the stock exchange.
A master plan
Abou Jaoude said that FFA is trying to help develop a master plan for the whole Naas area, beyond this one project, to enhance overall growth.
“It is about changing the identity of Naas, creating a destination, and making it as one of the environmentally friendly areas of Lebanon,” he said. Accordingly, FFA Private Bank, in collaboration with the municipality of Bikfaya, wants to lobby for a ‘green committee’ in the area that will help revamp the old, dormant hotels, protect the green spaces, set planning guidelines and increase the investment value of the land.
“That is our aim at the end of the day — having a profitable project called Naas for our shareholders and investors,” said Abou Jaoude.