Certainly not Lebanon’s most outstanding year on record for real estate, 2017 saw investors and developers react to wider events in the region and think twice before committing finances. Indeed, if there were one word to characterize Lebanon’s real estate sector in 2017, it would be stagnant, according to Mireille Korab Abi Nasr, FFA Real Estate’s Head of Business Development, who sits as a board member at REAL (the Real Estate Syndicate of Lebanon) and REDAL (the Real Estate Developers Association). Mireille Korab Abi Nasr is quick to point out that the market witnessed some very shy activity during the year, and therefore cannot be described as dead. In terms of the market’s appetite for buying, she believes it was purely driven by those with a strict need to buy or move residence.
The flip side to the lower volume of sales locally is that buyers gained more bargaining power, and were able to leverage better terms on financing, and greater added value for their money. For those Lebanese looking to buy to invest, attentions were mainly turned outside of the country toward Europe in 2017. “There is money in the market,” she said, “and investors are still active but not as much as we want them to be in Lebanon. They prefer to diversify since they already have exposure here in the country, so they showed greater interest in investing elsewhere in Europe.” FFA Real Estate’s portfolio includes a number of real estate assets in Portugal and Germany, two markets on which it advises investors looking beyond the region.
While the local market itself may have witnessed less activity in 2017, on a sector-wide level initiatives by industry bodies REDAL and REAL continued apace to improve professional standards. For Korab Abi Nasr, it is a matter of taking the sector to the next level steadily, in studied steps, which will help it transform to working within a framework. In development terms, this should see a wide embrace of environmentally-conscious development. The latter, which has characterized FFA Real Estate’s developments since the beginning, also fits with end-user aspirations, which are becoming more demanding, according to Korab Abi Nasr. “Nowadays, you see more developments adopting an environmentally-friendly approach. This is something we did very early on. Badaro Gardens, for example, was a pioneer in this approach to include green space within an urban development, and we proved that it’s an approach that pays off.”
While the election of a president in October, after a two-year vacuum of power, had been anticipated as a likely stimulus to breathe new life into the market, sentiment remained muted. “We’re used to the market being very sensitive to what happens politically,” explained Mireille Korab Abi Nasr, “but this time, things did not move much as the turmoil in the region continued to weigh on the Lebanese economy.” Korab Abi Nasr anticipates, however, with a cabinet recently formed, that the market should react more positively, with things back on track. “It will still be a challenging year in 2018. However, with the reestablished political stability, we should have more interest in Lebanon and more activity,” she noted.