How has the company evolved and performed in the market recently?
CARLOS CHAD Demco Holding is divided into three branches: Demco Shipping, Demco Steel, and Demco Properties. As the real estate arm of the holding, we used to finance real estate projects, though we are now fully involved in real estate development. For the past six years, this company has developed projects totaling around USD650 million in value. We currently have four ongoing projects. We do not focus on a specific location; instead, we are spread all over the northern suburbs of Beirut. We have gated communities of 500,000sqm far in the mountains. It is a unique project because it was conceived as a community built from scratch and was built in an eco-friendly manner. Only 2-3% of the plot ratio is used, whereas other developers occupy more than 20%. We are keen on keeping the development green and have even created a 30,000-sqm reserve where wild deer live; we are planning to create an area for wild wolves. We are unlike other developers that leave when all the units are sold; we manage the project for at least five to 10 years following delivery. Demco is not just a developer but a brand that to many people signifies strength, quality, and financial health.
GEORGES ZARD ABOU JAOUDE Today, GZA group is a backer of various real estate investment firms, positioning ourselves as one of the largest real estate developers in Lebanon. We are currently developing the most extensive residential community in the country—BeitMisk. Our real estate projects include contemporary apartment buildings in the city and other more traditional ones in the suburbs, all of which have been adapted to modern living standards. The apartments range in size, from small one bedroom to large three bedrooms, to be able to cater to all individuals and their needs. But what they all have in common is their key locations and an artistic yet functional approach to the design. On another note, we always make a point of giving back to the community that has enabled our growth and helped foster our achievements. That is why we have invested our resources in several socially responsible programs whose purposes are to contribute to improving Lebanese society, working closely with social and environmental NGOs, supporting orphanage centers, and providing university grants to select students.
How would you characterize the current Lebanese real estate market?
CC There is currently an oversupply in the market. All developers had a “build it and they will come" attitude in the past, but they were wrong. They did not study the potential absorption rate and the target market. Eventually, people stopped putting money into real estate in this country. Historically, the sector here never encountered a bubble; however, we are currently in a flatline. There is a segment, budget-wise, of residences over USD1 million, of which there are 2,000-3,000 apartments on the market. There is an oversupply, and buyers can negotiate 20-30% discounts on properties. Locals, however, do not have such purchasing power. This scenario will take a long time to balance out. Anything over USD1 million will be hard to sell and will remain on the market for some time. The Central Bank has benchmarked the market and is keen to support the real estate industry in the country because a great deal of businesses rely and depend on it in Lebanon. That is why it worked on subsidized loans and determined that the maximum apartment value should be around USD56,384. With this, people can get preferential interest rates. The bank knows this is the only way to keep the property market moving forward. Fortunately for us, we are the only developer in Lebanon to offer residences starting at USD88,000, with penthouses going up to USD15 million.
What makes your flagship project, BeitMisk, stand out from others?
GZAJ Co-developed by Emaar and GZA Group, BeitMisk is one of the most ambitious residential projects in Lebanon, located on Mount Lebanon. It covers approximately 655,000sqm, and will have 1,800 units upon completion, divided into apartments, villas, and townhouses. BeitMisk offers unmatched quality of living in Lebanon, bringing together residential units, commercial and retail outlets, and entertainment facilities for a complete lifestyle. It also utilizes green practices throughout, while offering residents all the amenities of modern living, making BeitMisk the equal of other premium living smart projects around the world. It includes an on-site tree nursery, aiming to increase the overall number of trees in the region, in addition to greenery maintenance for all parts of the project. BeitMisk has 24/7 access to water and electricity and a round-the-clock maintenance support, facility management help desk, and security. Furthermore, all units are fiber-optic ready, allowing for high-speed internet. BeitMisk is also equipped with a country club set to open in 2018-2019, with ideal spaces for sports activities.