Lebanon on fire
A forest fire re-erupted one week after it had first started in Fitri, 45 kilometers north of Beirut, affecting a total of 150,000 square meters of forest area near homes. The Dec 5 fire was the largest of as many as 120 smaller ones that erupted during the first weekend of December, due to dry air, hot soil and a lack of rain after an unusually long summer period. Interior Minister Ziad Baroud confirmed that 57 fires had started that day across the country. Simultaneously, another fire in Baabda forced hundreds of families to flee their homes. The municipality president Imad Daou told Agence France Presse that firefighters were not able to effectively put out the flames because of the rough terrain and lack of roads and city planning, making it difficult to reach the affected area. President Michel Sleiman remarked at the scene that the town’s unsatisfactory urban planning meant the fires spread much more than they would have otherwise. The increase in forest fires is a serious problem for Lebanon as much of its verdant land has been compromised in recent years. With global warming seen as the culprit, this is the first time Lebanon has experienced so many forest fires in such a concentrated period of time.
Doha takes the cup
Fifa’s announcement that Qatar will host the 2022 World Cup games — a month-long event that will require a whole new construction topography for the already booming nation — has construction firms eyeing the $57 billion to be doled out to prepare hotels, roads, stadiums, a metro system and other infrastructure projects, according to Arabian Business (AB). Some $4 billion is needed to build 12 air-conditioned stadiums. The $11 billion New Doha International Airport should be complete within the next two years. The $5 billion to repair existing roads is a small fix compared to the $35.6 billion required for the most ambitious of the infrastructure projects: the new metro rail system, to be fully complete by 2019, which plans to link Qatar internally as well as with the rest of the GCC countries. To deflect some of the cost, the Ministry of Business and Trade is currently researching public-private initiatives. Booz & Co partner Ulrich Koegler told AB, “While they will be actively looking — and discussions with our clients show that this is happening — they will also be diligent in trying not to produce failures that would hurt their reputations ahead of the World Cup.” Drake & Scull International DSI, based in Dubai, and Arabtec Construction, the largest construction firm in the GCC, are already established in Qatar and expected to be the frontrunners for contract awards. Thomas Barry, Arabtec’s CEO, told the daily, “We would expect to be in a position to win a higher share of such a market as we have the correct experience both in stadiums, hotels, residential and retail projects and the like — we are optimistic about our chances.” Industry experts agree that most of the contracts will be awarded to regional firms as Qatar doesn’t have the local expertise for such infrastructure implementation. On December 6, Arabtec shares jumped 9.1 percent and Drake & Scull (DSI) shares jumped 6.5 percent to a 12-month high amid expectations for both firms to win contracts in Qatar.
Industrial real estate creeping up the ranks
In contrast to the residential and commercial sectors of real estate, light industrial and logistics will carry a higher rate of return, on average, for investors looking to place their money in real estate in the MENA region, according to a December 12 report by Jones Lang LaSalle. Light industrial real estate is often overlooked and has the most growth potential, with demand rising. Usually controlled by government entities in the GCC, opportunities for the private sector are opening up. There are about 65 million square meters of industrial space in Dubai, making it the most promising industrial market in the region, followed by Abu Dhabi, Riyadh, Cairo and Jeddah. Citing an increase in demand from logistics specialists in Europe and Asia over the last two years, the report predicts the sector “will provide significant potential to generate increased sales activity in this market over the next few years.”
And the award goes to…
Middle Eastern firms are gaining global recognition, with several winning top prizes at the 17th annual International Property Awards gala in late November. Qatar was in the spotlight, as Barwa Financial District won the “International Office Development” top award. Chairman and managing director of Barwa, Ghanem bin Saad al-Saad, said in the firm’s December 6 press release, “Barwa Financial District stands out as a key development for Doha and demonstrates the diversity of our approach to real estate development, from high-end projects to those which meet the needs of all sectors of society and the Qatari economy.” Damac Properties, the region’s largest luxury developer, won in the category of ‘Best High Rise Architecture’ for their upcoming Damac Tower in downtown Beirut. Bahrain’s Pegasus Real Estate was voted the best property development marketer. Turkey’s first LEED-registered project, the $1 billion Varyap Meridian, won in the ‘Best International Architecture – Multiple Units’ category. The mixed-use project, which is under development by Varya, includes a 5-star hotel, residences and office buildings. Located in the Atasehir district of Istanbul, it will comprise 107,000 square meters, 90 percent of which will be green space.
Sales keep rising
The number of sales transactions for properties in Lebanon reached 77,360 during the first 10 months of the year, a 20.6 percent increase compared to the first 10 months of 2009, and a record high for that time period, according to figures from the Directorate of Real Estate, as reported by Bank Audi. Total revenues from the sales reached $7.7 billion in this period, a 51.4 percent increase from the first 10 months of 2009. The average value per sale in this 10-month period grew 25.5 percent to reach LL149.5 million ($99,666). The growth in the number of transactions started to level off in July of 2010, in parallel with declining levels of capital inflows.
Architecture party
On December 11, Beirut-based Loft Investments, founded by Mark Doumet and Ayad Nasser, launched, in partnership with BLOM Bank, their first award show for young Lebanese architects. More than 500 people attended the event in Ashrafieh, where the top prize for contemporary loft design went to Joanne Hayek and Zeina Koreitem. The purpose of the awards, Nasser said, is to encourage young designers to stay in the country, adding, “We have plenty of opportunity here.”
