The Buzz

Android Aphrodite

by Jasmina Najjar
written by Jasmina Najjar
  • With Valentine’s Day upon us again, do you ever feel you have done it all? Flowers, cards, bottles of wine – they all seem so cliché. How about dressing up as a cyborg or ‘wiring up’ to your partner in ways you never imagined? Wearable technology is a growing trend and to celebrate this most romantic of days, here are five ways to bring technology into the bedroom.1. The Intimacy Dress

  • This dress by Studio Roosegaarde takes a playful ‘now you see me, now you don’t’ approach to things. The white or black dresses are made with smart e-foils and when your heart starts to race from excitement the dress becomes transparent, revealing the naked truth of your turn-on. Perhaps not a great idea if you are going out for dinner in a crowded restaurant.

    Keen not to have men feel left out, Studio Roosegaarde is also developing a suit for men that turns transparent when they lie. This will definitely be a smash hit with businessmen, lawyers and politicians.

     

    2. The Love Tester Bra

    Japanese innovators at Ravijour recently launched The True Love Tester bra that only unlocks itself if true love is the mix. The company’s promotional video unveils the bra as the saviour women have been waiting for: apparently protecting us from the “animal, technician and flashy guy” who lurk around waiting to grope us at the first chance they get. While sexual harassment is a serious issue, how a bra, rather than lockable panties, offers protection is slightly bewildering. And why the bra is designed to seemingly burst open with great enthusiasm when it detects love, rather than discretely, is another mystery. One can only hope it doesn’t decide to fling open at the wrong time in the wrong place.

     

    3. The Mood Sweater

    The GER Mood Sweater, developed by Sensoree, includes an LED light in the white turtleneck sweater that changes color according to your mood: teal when you’re feeling zen, blue if you’re relaxed, magenta when you get excited, and red if you’re smitten. It takes the expression “wearing your heart on your sleeve” to a whole new level. Being in an awkward social situation can now be even more embarrassing since having a poker face and trying to exude the impression of control simply aren’t going to work if you’re sporting this.

     

    4. Long distance fondling

    Thanks to wearable tech such as Durex’s Fundawear, couples in long distance relationships are no longer physically constrained by geographical boundaries. If ‘sexting’ starts to bore them, they can now opt for vibrating remote control underwear. Using a smartphone app as a remote control enables either partner to virtually touch the other. Or so it’s advertised. How many couples will actually buy into this is another story.

     

    5. Watch yourself get intimate

    Google Glass is no longer new news but the apps being developed for it are still making headlines like the one created by Lebanese product design student Sherif Maktabi during the London Wearable Hackathon which lets a couple having sex see through each other’s eyes. If Google hadn’t taken the app down (the company is taking active measures to prevent sex apps popping up for Glass), women would have been staring in devastation at their cellulite in all its glory and men would have come face-to-face with a certain face they probably don’t want to see.

     

    For better or worse our love affair with wearable tech is here to stay. While some of the creations emerging seem like random flings, others are sowing the seeds for long-term relationships. Our burning passion for the new technology is driven by the never-ending search for anything that can spice up our love lives.

     

    Jasmina Najjar is a conceptual copywriter, journalist, and communication skills instructor at the American University of Beirut

     

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Business

Q&A – Spinneys CEO Michael Wright

by Thomas Schellen
written by Thomas Schellen

Spinneys CEO Michael Wright first spoke to Executive over a decade ago. We sat down with him to discuss criticism of the company, future growth and his long-term plans.

 

E   There have been attacks against Spinneys. What were the biggest challenges of this sort?
The attacks that we don’t mind are the competitive attacks. Supermarkets are about market share and you gain market share from each other and those kinds of attacks and counter-attacks are all part of the game. But unfortunately, almost two years ago, we were targeted by somebody as a way to create a political opportunity for themselves and ended up being dragged in to defend ourselves. That was fairly unpleasant; I have never been involved in anything like that in the past and as an organization we have never experienced a one-way diatribe of accusations without foundation, to which when you try and answer, you are ridiculed.

E   What does that tell you about reputation risk?
Fortunately, I have to say that these attacks were a potential business risk but had no effect at all, zero bottom line impact. We secured that there were no foundations in the facts and we had no concerns about the facts behind accusations that we don’t pay the minimum wage [and] that we don’t do this or that — it was all rubbish.

E   So tell me the truth about your salary scheme. Are you paying everyone what they are worth, are you paying to optimize employee retention, or are you paying to crunch the margins as much as you can?
I’d like it to be the first two. If possible, I would pay above the market in every single position and I think that for most positions, especially taking the full package that we provide, that is what we do in comparable situations. A shelf-filler who is joining us today, yes, he will get minimum wage. But he will get full medical cover and get social security, full vacation and will work the         standard hours.

E   With all the intricacies and competitive pressures in the type of retail you are doing, economies of scale must play a major role for you. Are you already near your optimum economy in Lebanon?
We passed a tipping point whereby all new stores don’t add to our central cost. Opening new stores thus is a lot easier to make profitable and a working business proposition.

E   One of the projects you were talking about eight or nine years ago were little corner stores and convenience shops. Other players have beaten you to those.
Yes but we have our own [convenience store concept], that we are preparing while we working on the pipeline as well. We have three confirmed big shops to open and two more medium shops in the range of about 2,000 square meters, which are about to be confirmed.

E   Your largest store in Lebanon is in Hazmieh where you are located practically across the road from the country’s first Carrefour store. Are you looking at Carrefour as your main competitor today?
As one of our competitors. I wouldn’t say our main competitor. We face them in several markets and we are very happy with our performance against all competitors, including Carrefour.

E   How many markets do you expect to be in three or four years from today?
My business plan will probably say ten; realistically it is probably going to be seven or eight.

E   Did the Arab Spring in Egypt have an impact on you?
In the first iterance of the Arab Spring, lawlessness broke out and we had to close our main branches for a period of time. That obviously had a direct effect. The good thing was that in the second when it was safe to open our doors, business returned as it was on the day when we shut. But we felt that there would probably be a delayed reaction and that has proven to be the case. The economy has been heavily damaged, consumer confidence has been damaged, the exchange rate has been damaged and that had an effect. We had a retrenchment at all of our stores.

E   How much does Lebanon contribute to the group revenues?
Between 45 and 50 percent of sales revenue. In profitability, Egypt was number one in net profit in our financial year that ended in June 2013. Our two profitable countries are Lebanon [and Egypt].

E   When you were acquired in 1997, the whole group sold for $116 million. If you were looking to sell today, how much is Spinneys worth in your best estimate?
I would say a quarter of a billion [dollars].

E   But Spinneys would be for sale, as being owned by an investment fund normally implies an exit strategy?
Yes, absolutely. The company would be willing to do the right thing at the right time in any of these directions, whether it would be via a private sale, a sale to a trade group, investor or going public. But an exit would be timed to also match the markets we are in. You couldn’t easily market Lebanon and Egypt at the moment, with the political problems and the war in neighboring Syria. Uncertainty may be disappearing from the Egyptian market politically but economically it hasn’t disappeared yet.

E   It was surprising for me to hear that you would only allocate a quarter of billion dollars in market value to the company at this time.
I put quarter of a billion for a particular reason and that is factoring in the instability in the region and the weighting that we have on Lebanon and Egypt. My opinion is that the optimum time to exit Spinneys is in the future and that this value can be many multiples of where it is today.

E   Do you disclose revenues?
I don’t mind disclosing them. Our revenue is around half a billion [dollars].

E   In the 2013 financial year that ended last June?
Yes.

E   What is in store security wise for your Lebanon operation in 2014?
I am assuming that there will be more of the same that we face today, not a dramatic worsening of the situation. We are in the middle of spending an extra $100,000 on capex to upgrade certain aspects of our hard-wired security and we reckon about $15,000 in extra expense per month on top of what we are currently doing. Our aim is to create a safe shopping environment for our customers; how to achieve that means in the first to put reasonable measures in place to physically prevent somebody from targeting us. The only thing we can do is to make ourselves a hard target.

E   Will the customers have to pay for added security via price hikes?
No, because everything that we do is driven by market competitiveness. We are not able to hike prices because we are driven by the continuous daily slog against all our competitors for market share.

E  You have spent 26 years with Spinneys, much of it in senior positions. What does it take out of a person to run a regional retailer for such a period?
(Chuckles) Everything. [But I am] not as stressed out as I used to be. Calmness has come with age.

E   Would you do it again?
Let’s put it this way: I wouldn’t allow my children to do it. I think there are easier ways to succeed in life. But it is the route I chose so I don’t want to regret my own life.

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Business

Letting go is never easy

by Livia Murray
written by Livia Murray

We’ve been in business for 17 years, and this is the toughest year we’ve had so far,” says Christine Assouad Sfeir, CEO of Dunkin’ Donuts in Lebanon, which saw its first local closures — lowering its total franchises from 30 to 25. With a slew of landmark closures — both Krispy Kreme and Hard Rock Cafe exited the market last year — the situation is turning bleak for Lebanon’s food and beverage (F&B) industry. Entrepreneurs such as Sfeir have known successes. After bringing Dunkin’ Donuts to Lebanon in 1998 and expanding the franchise, she is still clinging to the Lebanese market. But for the past couple of years, with fierce competition, increasing fixed costs and a smoking ban all compounding a precarious political and security situation, Lebanon’s F&B industry is seeing a serious decline, prompting alarm bells in the upper echelons of management.

Hitting a new low

Lebanon’s economy has a reputation for keeping afloat despite political and security events. But this last year has been one of the roughest, and prospects for it to pick up are grim. “We are asking ourselves: is our economy as resilient as it used to be in this type of situation?” says Charles Arbid, president of the Lebanese Franchise Association. The string of security incidents that have rocked Lebanon over the past year and a half have left businesses in the F&B industry with little time to recuperate. They have taken a toll on consumption, with indexes for both F&B and tourism — an important source of revenue for the F&B industry — down by as much as 30 percent in 2013 according to Arbid.

While revenues dipping into the red prompted many businesses to close over the year, those still remaining are managing the crisis with pains. According to Sami Hochar, CEO of Catertainement, which acquired popular franchise Lina’s Cafe in 2001, the cafe barely broke even in 2013, even after cutting their losses by closing their Byblos and Faraya branches. “Normally we try to keep them and look for better days. But in such a situation we [had to] close them,” says Hochar. Dunkin’ Donuts’ five closures followed an overall decrease in sales of 20 percent. Family-run Cafe Younes, which is now managed by Amin Younes, the grandson of the founder, was able to keep all of their branches intact, but suffered a 15 percent overall decrease in its 2013 sales between its four coffee shops and two roasteries.

The decrease in economic activity has been exacerbated by soaring fixed costs. Rent has become so expensive that managers such as Hochar are actually in the process of lobbying landlords to lower their rent payments while they weather the storm. Particularly in premium locations such as ABC mall — in good times a prime location for business — in bad times the fixed costs can overwhelm a business’ accounts. Though Hochar is not yet ready to relinquish his place in the mall, coveted by a long waiting list of businesses, he says that he can envision a situation where he would have to withdraw out of necessity. High rents are not limited to malls, and impose a great burden particularly on newer branches that have not had time to turn profitable, forcing many closures among recently opened branches. Two of the branches that Dunkin’ Donuts closed within the last year were newer branches that did not yet have a chance to turn profitable. With skyrocketing rents, the fate of nonperforming branches is clear; “you don’t have the possibility to wait,” says Sfeir.

Crisis mode

Companies standing their ground in Lebanon have had to seriously re-think their strategies in order to manage the crisis. A ubiquitous survival tactic has been trimming the costs of operations: decreasing the number of staff working at one time or shrinking the number of items on the menu. But cutting costs needs to be done carefully in order to keep any change in quality minimal. “If you affect the customer experience, this is gonna kill the brand and kill the business,” says Sfeir. Businesses pursuing this tactic need to constantly check the impact of their cuts on their customers, otherwise they may lose what little business they still have.

Large-scale franchises have costs additional to their operational ones that are suffering from the shrinking margin of profits. “The income is not enough to stand a structure like ours,” says Hochar, referring to the behind-the-scenes management teams, with associated costs in marketing, advertising, accounting, and so on. “We tend to, unfortunately, lower the expenses on this management company so we can leave the shops running normally. And this is how we can keep on going,” says Hochar. Cafe Younes too, has cut what its CEO described as “luxurious” expenses such as lowering re-investment, a significant part of expenses vital to remaining competitive in Lebanon’s fast-moving F&B industry. “Hopefully things will get better, otherwise really you won’t do the things that you are doing now. You won’t keep on performing, you won’t keep on changing,” says Younes.

Following the market

On top of coping with waning profits, F&B management have had to devise tactics for keeping up with the tricky Lebanese market. Downtown Beirut is witnessing a significant decrease in customers, particularly in the evenings, as security fears prompt people to remain closer to their own neighborhoods. The tobacco ban further dissuades a clientele fond of smoking in cafes, prompting chains to bank on long-term investments in new locations that they hope will be more attractive to customers. “You have to make a strategy in the long run, and in this strategy you have to rent new shops, open new shops, and struggle,” says Hochar.

Re-positioning the location and design of branches is a tactic pursued by many companies in the Lebanese Franchise Association. “They are re-engineering their business in Lebanon,” says Arbid. To chase these finicky consumers, Lina’s Cafe invested in re-locating and re-designing their shops to be friendlier to those customers who enjoy cigarettes with their morning coffee, and close to those who prefer not to stray from their own neighborhoods. They closed two non-performing branches in Byblos and Faraya in 2013 to open one in Mtayleb, Rabieh and are planning to open two more in Gefinor Center and Badaro in Beirut within the next three months, leaving them, if all goes as planned, with 16 branches in Lebanon. The new branches are more open, making them smoker-friendly. Vigorous innovation is one of the few ways in which Lebanese companies can keep afloat, as they vie to create more incentives for customers amid shrinking budgets.

Positioning abroad

With F&B businesses hanging by a fine thread, it is no surprise that companies are looking to expand abroad. “Franchising abroad for the Lebanese brand and concept is definitely a possible solution,” says Arbid. While Lina’s Cafe’s move to acquire licenses for the United Arab Emirates in late 2013 was mainly prompted by the situation in Lebanon, Sfeir is growing her two other companies Semson and startup Green Falafel exclusively outside of Lebanon. Likewise, Cafe Younes is opening a franchise in Riyadh in 2014. Growth outside of Lebanon certainly comes with less risks than expanding within. While they are eyeing the outside, they are nonetheless determined to stand their ground in Lebanon, hoping that outside expansion is just a means to stay on their feet long enough to ride out the crisis.

 

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Comment

The problems of being a non-smoker in Lebanon

by Jasmina Najjar
written by Jasmina Najjar

We were enjoying the ambiance at a resto-bar until it hit, or rather puffed our way. Breathing suddenly became an unpleasant task and there was mist everywhere. I looked around to determine the cause. Lo and behold, practically everyone was smoking, in an enclosed indoor space. Surely, the waiters or management would kindly ask the smokers to refrain? Thirty minutes went by and nothing happened. The mist was now a heavy fog. One of the young ladies in our group looked anxious. She was pregnant and was naturally concerned about the wellbeing of the life growing inside her. “I thought smoking was banned indoors,” she said with a confused look. “There is a law but the management must be paying the authorities to turn a blind eye, or have a special license, or maybe they simply don’t care if people report them,” responded another friend.

I’m not sure what was going on, but I can say that my restaurant experience went up in smoke. No such “special license” exists in Lebanon. I will not be going back to that restaurant, out of a matter of principle. What could have been an enjoyable night turned into a hellish experience. I reeked of smoke when I got home and my throat was sore. And this is not the first time this has happened since Law 174, banning smoking indoors, was enacted. Recently we decided to go clubbing. The second we stepped into the indoor space, we were greeted by a cloud of smoke. Its intense welcome was a bit too much for us and once again on principle we opted to leave. If the management felt it was fine for them to go against the law, then we felt it was fine for us to go against the etiquette of having reserved a table.
The number of places violating the anti-smoking law is now so large that finding a place that enforces it is a real challenge. The culinary delights at restaurants that ignore Law 174 are second to none, because the smoke adds a special garnish to all dishes: chicken à la smoke and ash salad. It enriches the flavours, especially since food is tasted by your sense of smell and not just your tastebuds.

Whether or not Law 174 is perfect is not the issue here. No law is 100 percent perfect after all. Whether or not the majority of people are smokers is not the issue either. The issue is that we live in a strange realm that’s a cross between the Wild West of the days of yore and the insane world of Mad Max. A place of lawlessness. Here, respecting the law seems optional rather than obligatory. Traffic lights are often nothing more than entertaining disco lights and pedestrian crossings are postmodern decor on the asphalt. When Law 174 was looming on the horizon, the food and beverage industry was in an uproar. A dubious study threatened that 2,600 jobs would be lost because of the ban. In truth, the F&B sector has seen job losses, closures, lower profits, and harder times. The blame should fall on the political instability, lack of tourists, random bombings, and high cost of living vs. low salaries, not the anti-smoking law.

Law abiding citizens can call the number 1735 when they see a smoking violation, but with rumors flying around of ridiculously reduced fines and some callers receiving threats from the owners of the places they reported, most are not exactly encouraged to take action. The news about the verbal symphony of insults a woman received in February 2013 when she approached a manager because of smoking violations went viral. Many establishments don’t react well if someone voices their concerns about indoor smoking.

On the bright side we live in a culture that is very considerate of others. Most smokers never ask if they can smoke, they simply do, and non-smokers and pregnant women are so considerate, they say nothing most of the time.

The benefits that many countries with anti-smoking legislation have witnessed, such as lower percentages of smokers, better overall health, cleaner indoor air, fewer smoking related diseases, lower expenditure on ventilation at F&B venues and longer life spans, are simply not worth it. The only thing that speaks is a quick dollar. Why wait for smokers to adapt to the law? Non-smokers, children and pregnant women can just go up in smoke, just like Law 174 has. Disrespect of the law is a microcosm of the macrocosm. It’s one of the reasons why it will take Lebanon forever to become a state that protects its citizens. And in this case it’s mostly the citizens who are to blame.

 

Jasmina Najjar is a conceptual copywriter, journalist, and communication skills instructor at the American University of Beirut

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The Buzz

Three scandals Faisal Karami should investigate before a topless skier

by Livia Murray
written by Livia Murray

On Monday, a video and photos surfaced on the internet of Lebanese Alpine Skier Jackie Chamoun posing topless in the Faraya ski resort went viral.

Distressed that footage taken three years ago which was never meant to be made public is detracting from her forthcoming competition in the 2014 Winter Olympics, Chamoun apologized and hoped to bring an end to the issue.

But Caretaker Youth and Sports Minster Faisal Karami was quick to get involved, calling for action over the content. Karami (pictured below) has demanded the Lebanese Olympic Committee investigate the incident, reportedly in order to protect Lebanon’s reputation.

Yet Karami’s decision to jump on the bandwagon by demanding an investigation has inevitably shifted the focus from his own track record. Since being appointed in 2011, the minister has overseen a chaotic period for both Lebanon and particularly sports.

Here are three actual scandals that Karami should deal with before he criticizes Chamoun’s photographs.

 

1. The country’s basketball crisis

Lebanon’s basketball leagues are in complete disarray, so much so that last year the International Basketball Federation (FIBA) suspended the Lebanese Basketball Federation from international competition. As such, the domestic season ended without a winner while the country’s stars faced the embarrassment of flying all the way to the Philippines to play in the FIBA Asian Championships, only to turn around having not thrown a single basket.  The primary causes for the chaos were political infighting and sectarianism, something Karami admitted but has done little to tackle.

(For the full story, see Executive’s coverage here.)

 

2. Ongoing corruption in sport

Basketball isn’t the only sport that has seen its fair share of chaos since Karami took charge. Lebanon ranks in 127th place in the Global Corruption Index but perhaps should be lower for football.

In 2012, Lebanon had perhaps its best ever chance of qualifying for the FIFA World Cup. The country had made it through the first group stages for the first time and was due to play Qatar at home. Mid-way through the second half, defender Ramez Dayoub inexplicably passed the ball to Qatar’s striker to score.

It later turned out he was one of dozens of Lebanese footballers receiving money for deliberately throwing games (he was eventually fined just $15,000 and banned for life). But the initial revelations came not from work from Karami and his ministry, but an investigation from the Asian Football Confederation.

And it is not just the players whose reputations have been tarnished. In January this year three Lebanese officials were banned for at least a decade each for trying to fix a match.  In fact, referee Ali Sabbagh’s bribe was not in fact monetary, but in sexual favors from a woman tied to a gambling syndicate.

Experts believe that corruption remains rife in Lebanese football.

 

3. Crippling youth unemployment

 

As Minister for Youth, Karami appears to have done little to counter the joblessness for young people. Lebanon’s youth unemployment was at 24 percent in 2013, representing 66 percent of all unemployed people in Lebanon in 2012.

Karami could re-direct his efforts away from reproaching nudity and towards promoting policies that make the market more favorable for young job-seekers. A 2013 report by the World Bank has called for coordinating investment, labour, skill development and social insurance policies in Lebanon to create a more opportune environment for employment.

Lebanon needs to create 23,000 new jobs per year over the next decade to absorb the growing amount of job seekers. Many of the jobs it is currently creating are in low productivity sectors that employ unskilled workers. Moreover, many skilled Lebanese jobseekers have left the country to find social security and better wages. According to a report from the American University of Beirut, a quarter of Lebanese youth want to emigrate, while another fifth are thinking about it.

The public sector could play a hand in improving the job market, providing more incentives for youth to stay in Lebanon. If Karami is to be taken seriously as caretaker minister of youth, there are a few issues that should rank higher on his agenda than a skier in Sochi.

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Leaders

Risky business

by Executive Editors
written by Executive Editors

No matter what some might say, the Beirut Stock Exchange is economically insignificant. Few companies are listed, with real estate giant Solidere and a handful of banks taking up the largest share of the market, and there has not been a new listing since the turn of the century.

This sad state of affairs is begging for change, and many investment bankers are hoping to see more companies going public in the coming years (see story). It could certainly bring about many positives. A new flow of companies opening up their capital to outside investors would lead to an increase in investment banking services revolving around financial advisory, restructurings, mergers and acquisitions, and initial public offerings (IPOs).  This could help change economic norms in a country where the dominant corporate structure is still the family one, whose organizational structures are often opaque at best. Opening up such businesses to outside investors could promote open finance, transparent governance and even feed into wider economic growth.

Yet investment banking is certainly not a panacea to Lebanon’s woes, and could in fact exacerbate them. The global financial crash, caused in large part by the rapid and uncontrolled growth of investment banking, shows that the sector is certainly a double-edged sword.

As such, it is vital that if the sector is to grow then so must the regulations. The agency in charge of regulating the markets, the Capital Markets Authority, entered into the game late and has been slow on the uptake. Established in 2011, it is progressively issuing and implementing new regulations for the stock exchange.

But the slow pace of activity begets concerns that the market regulations will fail to keep up with further developments in the financial sector. Regulations need to be installed quickly and efficiently to prepare for the potential of a brighter future while simultaneously safeguarding against a runaway financial sector undertaking increasingly complex transactions.  In the coming decades, as family businesses are passed down to a younger generation with new ideas, or split and sold off among several shareholders, Lebanon may see more IPOs and more need for investment banking. Going public could have many benefits for the companies, but these must be met with strict and timely regulations.

For Lebanon’s investment banking sector to have a positive impact on the economy, it is vital that an increase in capital market activity is paired with a serious improvement in regulation.

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Society

Green without envy

by Nathalie Rosa Bucher
written by Nathalie Rosa Bucher

Organic shelves and refrigerators filled with (fresh) organic products can be found in most Lebanese supermarkets these days. A few years ago, these products would have been hard, if not impossible, to source. Nour Farra-Haddad lists 23 companies and food stores under “bio and organic products” in “Eco-Lebanon Nature & Rural Tourism: A Guide to Unveil Lebanon” published in 2013 — clearly organic products are no longer leading a shadow existence and the sector, though small, is growing in Lebanon.

In the United States and Europe (notably France, Italy, the Netherlands and Germany), the organic sector reached two-figure growth rates in 2012. According to a press release issued by BIOFACH, the world’s largest trade fair for organic food, organic sales in Germany that year attained a record high of 7 billion euro ($9.6 billion), up by 6 percent, with demand exceeding supply.

Organic products tend to be considered a privilege of the moneyed with price tags usually exceeding non-organic products. Asked why consumers should fork out LL5,000 ($3.30) for a simple but beautifully designed, recyclable and informative carton containing six Biomass eggs (“certified organic according to the European regulation”) instead of spending half on non-organic or baladi eggs, Mario Massoud, executive manager of Biomass, explains that indeed the price gap in Lebanon is bigger.

“We have to buy French chicken feed, which costs quite a bit. You won’t find organic feed in Lebanon. Biomass does not use GMOs [genetically modified organisms], or any growth-enhancers. Our chickens are free range and when a chicken is sick the animal is put into quarantine. Our organic eggs are free from antibiotics and pesticides,” Massoud says.
It took two years for a substantial amount of Lebanese customers to opt for the costlier egg box. “In 2007, when we started with eggs, we used to sell one out of nine boxes. We had the most expensive eggs,” Massoud recalls. Due to growing demand, Biomass established a commercial project in early 2010 and has grown from three to 40 employees. Biomass has 2,000 chickens at their Batroun farm and another 8,000 on nine other farms. Their organic eggs, initially rejected, have advanced to a bestselling product.

Straight from the source
Massoud’s family decided to convert their land in Batroun after the Mediterranean Institute of Certification (IMC) came to Lebanon in 2004 to promote the organic sector. They began the conversion process in 2007 with IMC help and were certified in 2010.

IMC certification is an intensive process which, depending on the size of the land farmed and variety of activities for use, can cost between $300 and $6,000. It comes with support from the IMC and controls and guidelines requiring organic farmers to use organic seeds, while forbidding the use of synthetic chemicals and GMOs. Given the limited availability of local organic seeds, Biomass has to import them from Europe and the US (adding a significant carbon footprint to their products).

“We do companion planting, crop rotations and work according to seasonality,” Massoud explains. “To maximise diversity, we work with different altitudes and 30 to 40 farmers [across Lebanon] to ensure a maximum variety of products. These farmers all needed to be certified with IMC.” The collaboration with farmers has created employment for an additional 150 to 200 people.

Biomass presently has 150 to 200 points of sale. Their range of fresh fruit and vegetables totals 180, with 10 types of lettuce alone, four to five kinds of salad, 50 types of vegetables and around the same amount of fruit.

Grocery products include olives, grains and pulses, pickles and mouneh and olive oil pressed by Willani, a local IMC certified olive oil producer. Furthermore jams, spices and dried herbs, and three types of chicken meat bear the Biomass label.

Henri Bou Obeid set up Bioland back in 2009, an organic producer and store with considerable investment, under the banner “from farm to fork”. For the land he’s purchased including landscaping, Bou Obeid, who has a background in environmental engineering and is managing director at Connex, invested $3 million for the Bioland shop, another $2 million for the vehicles and he employs 40 full time staff, mostly farmers.

Owning three farms, spreading over 200,000 square meters, Bou Obeid makes honey, grows 40 kinds of fruits and seasonal vegetables, and raises goats, pigeons, geese, ducks, rabbits and chicken.

The Bioland shop in Beirut, open since December 2013, was preceded by a fleet of refrigerated vans selling fresh organic produce door-to-door, and aims to dispel the myth that organic products lack in variety. Besides dairy, meat, fruit and vegetable counters, customers can find preserves, snacks and cereals, Lebanese and French organic wines, olive oils, syrups, honey, pasta, pulses and grains, all produced by a variety of international and local organic producers, including Biomass and Bioland. The shop also has a salad bar and customers can sit down for a sandwich for LL6,000 ($4) or one of the three “plats du jours” for LL16,000 ($11). Alternatively meals or products can be delivered.

Chef Joe Barza came on board and developed the organic menu to prove that organic can be simple, tasty and affordable. “But even with these big efforts some still find the prices too high,” Bou Obeid says. “As we noticed that there is a lack of communication, we explain in a concise way to customers the obvious principles of organic chicken, dairy, eggs, meat,” Bou Obeid explains, mainly through info tables placed on counter tops.

Obstacles to overcome
“Organic agriculture holds 0.48 percent of the market. It’s a shame to have such a small percentage, so it needs to be sold at accessible prices,” Bou Obeid says. “Meat is selling well at the shop. The same goes for poultry. This reflects the Lebanese shopping basket, of which 70 percent is meat, chicken and dairy.”

Bioland has secured 12 business-to-business clients including restaurants, schools, specialised shops, nutrition centers and kindergartens. “Having organic shops and B2B orders is important for our financial equilibrium,” Bou Obeid says.

The company uses e-marketing and places ads on Connex buses, organizes in-shop tastings and relies heavily on social media, managing a busy Facebook page. On the other hand, Biomass has focused on branding exercises but communicates very little.

A lack of awareness from consumers around artisanal baladi products — which are not necessarily certified organic — and the cost of production are some of the key challenges Biomass and Bioland face. “Ensuring freshness of their goods and the availability of products are further challenges,” Massoud says. Being forced to fall back on foreign raw materials such as seeds and animal feed draws production costs up and this is reflected in the price.
Both Massoud and Bou Obeid are hopeful that positive change is imminent. “There is now at the Ministry of Agriculture a national committee for organic agriculture. Based on the committee recommendations, the ministry has already issued several decrees,” Massoud says. Bou Obeid regrets that there is still no Lebanese logo such as the French ‘AB’ (agriculture bio). “The only visual identity is the IMC logo and that’s Italian.”

Bou Obeid deplores the fact that bureaucratic hurdles prevent him from importing French auxiliary insects — for example ladybirds that fight pests, a substitute for pesticides. “There also is a lack of help from the Lebanese government to export organic produce. We could export olive oil to China!”

Since 2013 Biomass has been exporting to Gulf countries, notably Kuwait, Qatar, and Oman and is completing a large new warehouse in Batroun to absorb more quantities for export and the local market.

“The government should provide more support for organic agriculture and encourage new farmers to go in this direction. There are more shops opening, more restaurants want organic ingredients and more people want organic food,” Massoud says. “We’re working on widening our product range and reach in Lebanon and are constantly looking for local farmers to join, and working with farmers to see how prices can be reduced.” To eventually facilitate a more direct contact with the consumer Massoud hopes to soon open a Biomass outlet.

Massoud concedes that due to the high overheads the company has been losing money the past seven years. “Biomass is not profitable yet, but will be within the next year or two.” In 2012, French investors Unibel came on board, taking a 35 percent share.

Bioland expects returns in the realm of $700,000 to $800,000 for 2014, which Bou Obeid considers little, when looking at his investments. Among his plans for 2014 is the launch of a restaurant in Batroun as well as an organic wine. He will also be acquiring another farm and launching quality certificates.

While he has already received requests for franchises, Bou Obeid prefers to put a quality manual together this year. “Something like our bible, if one day we give a franchise. Right now that is not our target.”

 
Riding the macro wave

After years of hosting and consulting customers, supplying them with imported organic products and feeding them macrobiotic meals, Odette Aghajanian bought a shop space at the Saint Joseph Medical Centre in Achrafieh in 1995 and named it MacrOdette.

“It was a boom,” her daughter Tania Aghajanian Kayrouz says. “I remember, taxis from Jordan and Syria, wealthy people, sending a car once a month in the mid-90s to be filled up with organic goods. Mariam Nour was promoting the macrobiotic diet; Kuwaitis came to eat at her place. A great amount of our turnover was due to demand from outside Lebanon, about 40 percent.”

Aghajanian started her quest for a better diet when her husband had to lower his cholesterol and discovered and embraced macrobiotics while in France in the 70s. “Macrobiotics is a diet based on eating wholewheat rice, miso, tamari [fermented soya sauce], organic cereals such as barley, oats, millet, pulses [legumes], seaweed and fresh, seasonal fruit and vegetables and no dairy,” Kayrouz says. “I have four children. All four are ski and athletics champions. They never had milk, besides being breast fed for one year. There is not a single drug in our house.”

Back from France, Odette started sourcing organic products, notably French and Belgian brands Tama, Lima, Celnat and Jean Hervé through people coming from abroad, eventually deciding to request organic products directly from the manufacturers, and became their (sole) agent for the Middle East.

Besides still selling some of the original imported organic brands her mother introduced here, Kayrouz stocks few Lebanese products, except for Adonis Valley, local fresh produce, and darfyie (a goat’s cheese).

“I have no faith in Lebanese producers, there’s no way to check,” Kayrouz says. “If I am dealing with someone who has cancer, I need to know that this apple has not been sprayed!”

Despite the challenges, including transport costs, bureaucratic hurdles of paperwork and the Beirut port, MacrOdette imports most organic products. “Our goods are stuck at the harbor, they’re running tests…I paid the order in October.”

“Some people tell me that they’ve seen a product sold for 1 euro in Europe and question why I sell it for more. I have to pay for internal transport from the manufacturer/producer to the port, then maritime transport, pay for the container, the lab, and given the expiry dates and delays, there may be some waste, so we may go up to 6 euros.”

Kayrouz says things have improved since her mother began; people, in part due to various food scandals, are better informed today. “As a result, red and white quinoa, linseed, chia, goji berries and coconut oil [linked to an improvement in Alzheimer’s patients] have become very popular.”

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Business

Stowing the rich

by Thomas Schellen
written by Thomas Schellen

The formula is intriguing from a commercial perspective and it has pizzaz: the Beirut Yacht Club, scheduled to operate for the next two months under a soft-opening formula and celebrate commencement of business with a formal launch in April, targets the upper crust of the resident business community with a concrete space for reveling, relaxing, and rubbing shoulders — the 14,000 square meter (sqm) Yacht Club building at the end of Zaitunay Bay development in the St. Georges Bay.

The property includes areas for members and their guests in the form of bars, restaurants, terraces, a library, pool, meeting and recreational rooms, plus 53 residential units, of which nine will be operated by the club as exclusive lodging facilities. Of the remaining 44 units, 11 have been sold and the others are for sale as serviced apartments at a range previously not found in the Lebanese market — prices per square meter range from $15,000 to $25,000, according to Farouk Kamal, chairman and general manager of Beirut Waterfront Development S.A.L., the company which owns and operates the project.
The market that a developer can address with such a product is clearly the high net-worth and ultra high net-worth community, or individuals and families in the top 10 percent — those who, globally, own 86 percent of the world’s wealth according to the 2013 Global Wealth Report by Credit Suisse. The segregation of this addressable market from the averagely heeled population is reflected in the access threshold of the Beirut Yacht Club. Enrollment in the club, which will be limited to 500 members and carries an initiation fee of $15,000 for an individual and $20,000 for a couple, is precondition for buying one of the club’s residences.

Kamal is positive about the prospects of finding buyers who will happily part from their cash in exchange for a flat which will cost around $3 million based on average unit size of 150 sqm and median sqm prices of $20,000. People have already shown “a lot of interest,” he says with ostentatious confidence that his target market will jump on the opportunity to procure an apartment which is priced off the local charts but comes “fully furnished” and with the entitlement to use the “4,000 square meters of club area attached to it.”

He admits, however, that the company cannot be sure about the Yacht Club’s performance in the coming summer and is basically keeping its fingers crossed in hopes for improvements in Beirut’s tourism and general security conditions so that the inaugural season will go well in terms of the venue’s usage for events, leisure and food and beverage offerings. A good market response in these areas will also be important for the attractiveness of the real estate. “We are selling club residences and people will appreciate the residence when the club is buzzing and active,” Kamal says.

Reaching the social stratosphere
Besides the knowledge that Beirut real estate prices tend to be extremely resilient against downward pressures, other incentives for investing in a Yacht Club residence include the option to have the management short-let a unit on behalf of the owner. And of course, owners can circulate through the club basking in the feeling that they actually own a piece of the place, in contrast to the 90 percent of their fellow club members who will at least have to cross the street to get home — if they reside in one of the nearby residential structures of the Beirut downtown. Kamal sees a natural reservoir for Yacht Club membership in the district’s population of bankers, high-powered consultants and other business leaders to whom he wants to offer a community environment whose members “want to enjoy a certain level of exclusivity and at the same time rub shoulders with the right people.”

Adding a further dash of reputation, the Beirut Yacht Club might offer honorary one-year membership to select ambassadors countries whose embassies are the most active in Lebanon. Beyond the paying members, diplomatic elites and their guests, however, the club will not welcome the public to revel on its premises. This restriction to a wealthy and minuscule part of the population is perceived by critics of the project as flying in the face of the land reclamation that created the land on which the Beirut Yacht Club and the adjacent Zaitunay Bay hospitality area have been constructed.

The controversy over the transfer of these reclaimed parcels to the private sector — meaning Solidere, the company mandated with the reconstruction and development of the Beirut downtown — has roots in the 1990s that relate to the case of the St. Georges Hotel and the reclamation of land for the New Beirut Waterfront of which Zaitunay Bay is but a tiny part. A reverberation of the old confrontation recently rung through the media by way of a very public altercation between caretaker finance minister Mohammed Safadi and caretaker public works and transport minister Ghazi Aridi. In an exchange of accusations, Aridi asked Safadi if he was a “thief” and also claimed that the construction of an elevated walkway in Zaitunay Bay was illegal.

The Zaitunay Bay project and its managing company are a 50-50 joint venture of Solidere and Stow Group. As Kamal confirms, Safadi is the main shareholder in Stow Group, a real estate and investment holding with interests in the United Kingdom, Lebanon, and Oman. Besides heading Beirut Waterfront Development, Kamal is also the executive chairman and a shareholder of the group’s Stow Capital Partners.

Big fuss over a small construction

On the face of it, the argument over a building violation in Zaitunay Bay is focused on a technicality. The absence of a required decree does not put into question the legitimacy of the land’s allocation for private ownership and the construction is not a recent alteration of building plans or anything such. The 10-year-old original design for the project shows the disputed walkway leading up to the roof of the Yacht Club as terminating point (with exceptional sea view) of a promenade for broad public access.

From the perspective of its use value, the private ownership of Zaitunay Bay’s existing marina-side boardwalk and its upper promenade has caused some restrictions on activities such as skateboarding. From the area’s design point of view, on the other hand, the extension of the promenade has a consistent appeal and from the perspective of balancing the recreational interests of restaurant goers, skateboarders and so on, finding a solution appears to be a matter typical for community arbitration rather than cabinet-level action.
Much more interesting, albeit in hindsight, is the question of how the public interest was represented at the time when Solidere and Stow first forged their partnership. Solidere’s 2012 Annual Report contains an elaborate narration and an impressive pictorial on the downtown’s development that far outshines the report’s financial pages. This narration states as a fact that the two companies formed a joint venture to whose capital Solidere contributed 22,350 sqm of land with permission for 20,000 sqm of built-up area while Stow contributed $31.6 million in cash.

The report’s financial pages specify further that the joint venture was formed in February 2004 with an initial capital of $19,900 and that the partners increased this capital in 2006 by $12.8 million and that Solidere sold “properties with an aggregate cost of $10.1 million… to the joint venture for a total consideration of $31.6 million” against which Stow contributed the equivalent cash amount.

Not explained is how the partnership was agreed upon and if there were competitors for entering a deal with Solidere to develop what are today Zaitunay Bay and the Beirut Yacht Club.

What can be said is that Stow Group, whose founders in 1985 included both Safadi and Kamal, has a visible propensity to collaborate with leading companies. The company says on its website that it is engaged in three “principal industry relationships.” Solidere is identified as a principal partner and so are TAG Aviation, with whom Stow has shared interests in the UK’s Farnborough Airport and Grosvenor.

The latter partnership means that Stow enjoys a strong business link with a company that is not only one of the longest-standing property owners in the posh Mayfair and Belgravia districts of the UK capital but also represents the business interests of the richest man in the country, Gerald Grosvenor, Duke of Westminster.

Stow’s projects in London in several ways give a very different impression from its more adventurous projects in Beirut. For example, an office project in Mayfair was not only blended marvelously into its street’s architectural context but its recent delivery was “on programme” and in line with what the company had said in a 2010 press release. In Lebanon, the congruence between targeted project completion dates and actual deliveries was nil.
If they say anything beyond highlighting that Beirut is not your usual market for projects and developments, the implications of Stow’s UK partnerships and track record may be that the company is  both keen on rubbing shoulders with the most potent partners it can find, eager to abide by its contractual obligations, and very much at home in the peculiar segment of the property market where a square meter price of $25,000 is not absolute record material (in 2012, Stow UK put a 870 sqm London townhouse up for sale with an asking price of GBP 17.5 million — about $27 million at the time and in excess of $31,000 per sqm).

A Bay on course?
In Lebanon’s feeble relationship between public and private spaces, the corner that Zaitunay Bay represents in a long shoreline of atrocious vistas interspersed with a few bearable developments is definitely more accessible, more appreciable, and better developed than some of its equivalents.

The hospitality project has lost some of its initial — and quite overbearing — snobbishness during the 2012/13 downturn of tourism and in a somewhat surprising statement, Kamal today emphasizes that “we know that for a project to be successful in Lebanon, whether it is a yacht club or a strip of restaurants, you need to depend on the local people, the middle class professional people. This is because if you are successful with them, tourists will come to that place. But if it is only tourists that come here, the locals will probably not come.”

The hospitality mix in Zaitunay Bay in January 2014 evidences a stronger orientation toward the locals and their tastes and pocket books when compared with the area’s initial tone. According to Kamal, the project owners steered the development partially away from the concept’s very first ambition of creating quality public space. He says they did so out of fears that this space could be abused.

It remains to be seen which course the Yacht Club will steer in the coming years, noting that nothing much in Lebanon ever comes out as planned or expected. But in a sense, the hyper-luxury orientation of the area is not actually new. Some 50 years back, in a period which older nostalgic socialites still like to call Lebanon’s golden era, the hospitality properties in this very neighborhood were the places where the elite sipped teas and aperitifs or smoked cigars in presumed splendid isolation from the squalor of the masses.

The question to be answered in the coming years in Zaitunay Bay, the whole New Waterfront and indeed the entire downtown is whether the necessary profit orientation of a private sector stakeholder is able to put enough emphasis on the social profits of well-managed public space, serving both public and private interests in reasonable balance.

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Business

A blossoming business

by Nabila Rahhal
written by Nabila Rahhal

It started out as a fun opportunity but became a real business,” says Mazen Maroun of Lotus Management Group, the hospitality development company which he and his brother Samer founded in 2003 with the launch of a sushi delivery service from La Gondole, their family owned pastry shop in Mar Elias.

Ten years later, it has indeed become a solid business with 300 employees and two successful restaurant chains, Japanese restaurant Soto and Olio pizzeria, with six branches of each spread across Lebanon. Toward the end of 2013 — despite the instability in the country — the brothers launched a new restaurant, Prune, in one of the side streets of Mar Mkhayel, Beirut, which they perceive as a new challenge for their skills in the business.
Their operations began with the concept of high quality, fresh, yet affordable sushi. “At that time, there were only a few and very expensive sushi venues in Lebanon and so we wanted to make it more accessible for everyone,” says Samer Maroun. For eight months, they tested the market through a delivery service launched from La Gondole. Mazen recalls how much attention they paid to the details — clean and neat packaging was as vital as having fresh and safe sushi at an affordable price — all of which created a trustworthy image for Soto — whose average delivery bill is now approximately $32 — when they opened their first venue in Gemmayze at the end of 2003. Two years later, they launched the first Olio right next door, and the company has been expanding and adding branches at an average pace of two venues every two years ever since.

The concept of good quality food at affordable rates resonated with the Lebanese consumer who cannot always afford high-end dining yet appreciates a good meal. It is also a concept that allowed the brothers to keep expanding — reinvesting revenues generated from the preceding venues into their next projects — with no partners to their company save for their venues in Dbayeh and Kaslik.

Although home delivery remains a viable aspect of their operations — accounting for 30 percent of orders — the business has shifted toward the onsite service, with Soto witnessing a yearly footfall of 220,000 and Olio 290,000. At its best performance, Soto serves more than 2.5 tons of fresh fish per month and Olio serves 1.4 tons of mozzarella, both indicators the company uses to illustrate its success.

Lotus Management Group had one misguided venture into Chinese cuisine in 2006, opening a Chinese restaurant in Gemmayze one day before the outbreak of the July 2006 war. The restaurant remained in operation for a year but was later sacrificed to maintain Soto and Olio, according to Samer. “For Chinese food to be [viable], as all our venues are, the average bill has to be between $40 and $50 and the Lebanese are not used to paying this much for Chinese,” rationalizes Mazen.

But despite their successes, the company was not immune to the same challenges faced across the economy in 2013 — making it the worst year in its 10 years of operation, according to Mazen, with a 65 percent drop in sales compared to 2012.

Even though the year started out well — and even outperformed 2012 in the first four months — it ended badly, with only the Gemmayze venues reporting a growth from the previous year. “Economically the year was a disaster but we are not thinking of closing anything: we were living abroad but came back because we believe in the country. Having said that, if [the situation] stays like this for four, five years down the line then who knows? We are still developing and expanding, but cautiously, instead of opening aggressively and creating even more business opportunities,” says Mazen.

Beyond lebanon
Expansion is still on the group’s mind, both domestically and globally. In line with the recent trend in the Lebanese hospitality business, Lotus Management Group is looking to franchise Olio and Soto abroad but is determined to find the right partner with which to do so. “There is a lot of interest but it is not as easy as it sounds because we are not looking just for the money. It is very easy to get capital but the right partner with the right background in the business and good PR is hard to find,” says Mazen. The brothers don’t have a specific region in mind and say they will go with whichever country provides them with the right opportunity.
Domestically, the Marouns have developed a new $300,000 investment in French bistro Prune, born out of Samer’s love for French cuisine and their need for a fresh challenge. While Soto and Olio have a recognizable ‘chain-restaurant’ feel, Prune is meant to be cozier and is where the brothers say they find themselves.

“Olio and Soto are more for the public than for us and there is very little contact with the customer on our part. Prune is us and every detail, from the plate to the kitchen to the customer, is taken care of by us,” says Mazen.

One can immediately sense the warm urban spirit that differentiates Prune from Soto and Olio from the French chic décor — including the mechanic’s rack transformed into a wine display that greets you at the entrance, the sepia class photographs adorning the walls and the black bistro-like wooden chairs and leather couches — and the fact that one of the two brothers is always present to greet patrons as if they were old friends and to ensure they have a pleasant experience.

According to Mazen, the customer profile for Prune is “those who are between the ages of 25 and 65 and are well-travelled, cosmopolitan and appreciate a real and affordable bistro.” Though this describes the typical clientele in the area, Mazen believes they are lucky to be away from the bars on the main street. “It is a plus to be off Mar Mkhayel because usually in Lebanon, streets that blossom quickly attract those looking for easy money and they ruin it for the more established,” elaborates Mazen.

The menu, which includes French staples such as mussels, cassouleh and steaks, is signature Lotus Management Group in that it serves quality food at competitive prices, with the average bill at $50 per person including wine, reasonable relative to prices for French cuisine in the market.

A family affair
The venue has a seating capacity of 45 people and with a turnover of 2.5 tables per shift, the Marouns say they are satisfied with Prune’s performance taking in consideration the situation in the country.

When asked whether Prune will be up for local expansion or franchising, the brothers agreed that they don’t see that happening in the upcoming four years. “It’s not only the décor, it’s the spirit that will be hard to duplicate. Prune is here and only here for now,” says Samer.
Lotus Management Group is not resting on its laurels and is already finishing up construction of a gourmet sandwich shop with a small terrace appropriately called À Côté, as it is adjacent to Prune.

Meanwhile, due to a sentimental value, La Gondole — where it all started with their sushi home delivery operation — remains a base for their businesses and is where their main office and all the accounting, management and purchasing needs of the business are located. “We did not give it a push because my mom and dad consider it their raison d’etre; if we give it new management they will not have a role and we do not want that. We could have developed it to meet the area’s needs but we are enjoying our parents’ pleasure managing it,” says Mazen.

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Society

Downtown, where everything waits

by Nabila Rahhal
written by Nabila Rahhal

Walk into the Beirut Souks in downtown Beirut in the evening lately and there’s a noticeable buzz of activity that’s been long missed from the sometimes eerily quiet shopping area. The Beirut Souks Cinemacity is finally open and the Souks seem primed to receive the benefits.
The cinema is part of the second phase of Solidere’s original plan for the Souks area, explains Rami Ariss, land sales and real estate leasing division manager at Solidere, with the third and final phase being a department store which has been delayed due to “a few complications.”

It’s all in the design
The remaining part of the second phase is an entertainment center whose exterior structure is complete — and can be seen to the left side of the cinema complex — but whose concept is yet to be determined. “We are bidding for a concept but we decelerated work on it because we want something unique and distinguished. Also, we don’t want to open it in the uncertain times the country is facing and risk burning the concept,” explains Ariss, adding that the entertainment center should be open within a year but that for now Solidere is focusing on the new cinema. Solidere’s goal is to have the cinema be an anchor for the mall itself and increase overall footfall to the area.

Cinemacity, a partnership of Empire Cinemas and World Media Holding, a media company operating in the Middle East, collaborated with Solidere on the cinema. Both Empire and World Media Holding have their separate cinema-related operations in Lebanon and the region, with their first partnership being Cinemacity in Dora’s City Mall before moving on to the Beirut Souks.

The cinema is run and operated by Cinemacity with Solidere taking the role of both the landlord and a partner of the operating company.

Hammad Atassi, chairman and general manager of Beirut Souks Cinemacity, says over $25 million was invested into the project — “a big undertaking.” Solidere’s Ariss says that the company ensured no cost was spared to create something iconic that would be sustainable for many years to come. In fact, according to Ariss, one of the reasons for the delay in the theater’s opening date was that there were many details involving the aesthetics of the design to cover.

The multiplex stands apart from most cinema complexes in Lebanon, if only by nature of its size. While typical mall cinemas in Lebanon are 3,500 square meters, Beirut Souks Cinemacity — the only stand-alone multiplex in the country — spans 27,000 square meters and is the largest in the region.

The space is divided into 12 regular theaters and two VIP sections — with an 18 and half meter screen in two of the theaters. There are three food concession areas serving a variety of munchies ranging from typical cinema fare like popcorn and nachos to salads and sandwiches, as well as some shops on Allenby Street and a food court. Despite its size, the cinema does not have the most seats in the region, a trade-off,  Atassi says, for its comfort and aesthetics.

The project’s concept is based on visuals and vibrancy. The exterior architecture was created by Valode et Pistre and is enveloped in LED screens, visible from Allenby Street as one approaches the Souk area. The screen is part of the interactive façade of the cinema and displays ever-changing scenes, such as the Lebanese flag on Independence Day or various holiday images in December.

The interior was designed by Nabil Dada’s Dada and Associates, whose brief says they “worked in response to the distinctive external architecture of the cinema by modifying the internal volumes and seamlessly integrating cutting-edge technology into their design to create a young and vibrant atmosphere.” This is reflected by some interior features such as the vaulted ceiling lined with 256 LED screens and the 50 meter long corridor leading to the lower level theaters, with its projections of animations on both sides and the various uses of lights on the escalators and walkways to create moods within the structure. Aside from its design and technology, Beirut Souks Cinemacity’s location in downtown Beirut and the free use of the Beirut Souks parking for four hours also attract cinemagoers. “A city’s downtown is usually where the major cinemas are located and this was the case in Lebanon before the civil war, but not after it. This project was long overdue and deserves to get the kind of business it is getting now,” says Atassi.

A box office hit
The cinema’s performance has exceeded expectations and Atassi says that in his experience with other cinemas in Beirut new theaters in Lebanon usually take three to four months before they achieve their average ticket sales. Thanks to the project’s visibility, he continues, ticket sales at the Souks rapidly exceeded the 1,000 tickets daily margin and were closer to 3,000 a day, something that no new Lebanese cinema has achieved in such a short space of time. “We expect it to get a third of the share of the Lebanese box office shortly,” says Atassi.
December’s bombing in the downtown area adjacent to the Souks slowed admissions to 450 people but the number shot up to 1,700 the next night.

“Despite it having the same ticket price as other theaters in Lebanon [$8], the Beirut Souks Cinemacity is attracting high-end, mature customers who are drawn more to intellectual films than the latest adventure blockbusters,” says Atassi, adding that since they have so many theaters, they will be playing films for a longer time and also featuring independent films.
While it is too soon to tell whether the cinema has had any major impact on footfall in the Souks, Atassi tentatively attributes the increased activity and longer opening hours in the restaurants around the cinema to its presence. “It is difficult to tell if this is the usual holiday traffic for the Souks or an increase brought on by the cinemas. To be able to have a solid understanding of its impact on the Souks themselves, you need normal circumstances for the Souks. Now we will be able to see,” says Ariss.

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