Abdali represents the past, present and future of Amman. What once was the Jordanian intelligence headquarters is today an enormous hole in the earth, in which bulldozers prepare for the arrival of the future: a 21st century city center for the capital of the Hashemite Kingdom. With a price tag of $1.5 billion, and covering a total surface area of 350,000 m2, the Abdali Urban Regeneration Project is arguably the largest construction effort Jordan has witnessed to date.
The Abdali area is located west of downtown Amman, adjacent to the banking district of Shmeisani, and is home to such landmark buildings as the parliament and King Abdullah Mosque. The Abdali regeneration project is a mixed-use development that aims to create a central business district, complete with both high-end residential and retail elements. In addition, and more ambitiously, the project hopes to relocate the “heart” of the city from what is today the rather run-down downtown area to Abdali when it is completed.
With a total built up area (BuA) of some 1.5 million m2, the Abdali project will drastically change the face of Amman, a predominantly “horizontal” city. The development will introduce the first cluster of high rises, among which is the country’s tallest tower, the 220-meter-high headquarters of the Capital Bank of Jordan. A 350-meter-long pedestrian shopping boulevard will connect the towers to the “Central Market” mall and residential parts of the project. (For details, see Box I.)
“The Abdali Urban Regeneration project is ‘a story of firsts,’ which will drastically change living and working in Amman,” said Jamal Itani, general manager of Abdali Investment and Development (AID). “Abdali will create the city’s first central business district, in the sense of a homogenous area of fully equipped, technologically advanced, state-of-the-art commercial buildings. Centered around the boulevard, Abdali will become the first retail hub in the city.”
An interesting characteristic of urban Amman is that it has no genuine central districts. The traditional heart of the city is the downtown area near the King Hussein Mosque and Roman amphitheater. Yet this is a rather rundown—and heavily congested—area, with no international retail and, at best, some three-star hotels. Over the last decade, Amman has witnessed the emergence of hypermarkets and shopping malls, which are spread throughout the western suburbs. (For a brief history of Amman, see Box II.)
Likewise, the business community is scattered around town. To a certain extent, the Shmeisani area can be defined as the financial and administrative center of the city, as it features 25 banks and financial institutions, 16 government institutions, as well as 12 hotels and nine hospitals. However, any company that aims to establish a presence in Amman will face great difficulty finding vacant office space in Shmeisani, which is why many international firms in recent years have converted villas and apartments throughout western Amman into workplaces. Embassies too are mainly located in villas between the 3rd and 5th circles in West Amman.
Private-public partnership
Founded in 2004, AID is a private shareholding company—initially, a private-public partnership between Mawared, an investment company owned by the Jordanian government, and Oger Jordan, a subsidiary of construction giant Saudi Oger. In 2007, however, Kuwait Projects Company (KIPCO), through its Jordanian branch, United Real Estate Corporation (URC-Jordan), came in as a third partner. It bought 12.5% of Abdali psc shares, which left Saudi Oger and Mawared with 43.75% each, respectively.
Essentially, Mawared brought in the land, while Saudi Oger had the know-how. It should be noted that the Abdali project is part of a wider government initiative to move military barracks and quarters to the outskirts of the city and use the land for urban development. AID is responsible for preparing terrain and infrastructure, as well as the project’s master plan. Saudi Oger will further develop and manage, in partnership with KIPCO, both the boulevard and mall, which represent about 25% of the total BUA.
The remaining 75% has been sold to private investors, including the Dubai Contracting Company, which is building a residential tower, the Capital Bank of Jordan, Rotana Hotels, Madaen Al Noor Real Estate Investment and Development, FCP Holdings, and Damac, the Dubai-based property developer. Damac is set to construct a 35-story high-end residential tower dubbed The Heights.
While top residential sale prices in Amman amount to about $1,400 per m2, Damac’s starting price lies around the $1,500 mark for the first floor and increasing to $3,300 per m2 for the top floor apartments. The penthouse has a price tag of over $4,000 per m2. Following the success of The Heights, which according to the Damac sales department has been almost completely sold, the company last month announced it will also construct the 20-story Business Heights.
“We’ve completed the site’s infrastructure, which includes all amenities, such as fiber optic cabling and gas lines,” said Itani, an American-educated engineer who previously worked in Beirut when Lebanon’s former Prime Minister Rafik Hariri appointed him President of the National Council of Development and Reconstruction. “In addition, about 80% of investors had their architectural designs approved and have fenced their plots of land, while about half of them will start excavating in April.”
Excavations have also started for the boulevard. Both the boulevard and city center are set to be completed by the end of 2009. To illustrate the sheer importance of the Abdali project, Itani pointed at a recent decision by the mayor of Amman, who designated four areas specifically for high rises, among which is the future central business district.
The question remains, however, if there will be sufficient demand within Amman for such a significant amount of office and retail space. “We’ve done several feasibility studies both in Jordan and other countries, and believe Amman has potential as a significant regional business center. Several factors play a role: Jordan is a politically stable and secure country that has a sound legal framework, so investors know what to expect. What’s more, oil prices are likely to continue to soar, with Arab nations reluctant to invest in the West. And, last but not least, Jordan is close to Iraq.”
It is no exaggeration to state that demand for office space and high-end residential apartments since 2003 has been strongly linked with the situation in Iraq. First, many well-off Iraqis fled to Jordan following the American invasion and established themselves in western Amman. As a consequence, average prices doubled and even tripled. Second, due to the security situation in Iraq, most companies doing business with Iraq are based in Jordan. The same is true for UN staff and non-governmental organizations.
Even though many malls have opened in the outskirts of Amman, Itani believes the Abdali project will offer an appealing edge to attract consumers, as it features the sole high street in the capital city, which will be characterized by international brand names similar to those found in Dubai and Beirut.
Beirut vs. Amman
Itani worked in Lebanon, and both Saudi Oger and Solidere are part of the late Rafik Hariri’s business empire: the obvious question is, to what extent can the regeneration of Amman and Beirut can be compared? According to Itani, there are both similarities and differences.
“Both Amman and Beirut concern developments built around a central business district and both aim to offer a homogenous development in terms of working, shopping and living,” he said. “One difference is that the regeneration of Beirut was a much bigger project, with about 4 million m2 of BUA, while Abdali amounts to about 1.5 million m2 of BUA, which could be extended in the near future by a further 1 million m2.” Itani declined to give further details, yet it seems likely that future developments will take place on the edge of the current project site, where some military buildings remain.
“Another major difference between Amman and Beirut,” Itani continued, “is the limitations that were involved in the development of the city. Solidere had to take into account the restoration of historic buildings and the protection of archeological remains. Consequently, Solidere was limited in the number of underground parking lots it could create. Generally speaking, we had much more freedom in terms of planning and design with the Abdali project.”
“Another difference is the role of the government, especially in terms of accessibility,” Itani concluded. “The Jordanian government plays an active role in upgrading the roads and intersections around the project site. It speaks for itself that the Abdali project is not an island. You cannot have top notch roads and parking facilities inside the project and be surrounded by secondary roads. In that sense, it is very important we have the full and active support of the municipality that is upgrading the infrastructure in and around the Abdali project.”
