Architect Sarmad Shayboub, the legendary founder and chairman of The Constructors Co. built during his long and outstanding career many quality buildings and towers where he implemented the state of the art in architecture.
His biggest focus has been on developing Lebanon's prime properties and in doing so he has earned international recognition for his visionary style.
Architect Sarmad Shayboub's real-estate empire is quite impressive for someone who started from scratch selling his property ideas on elegant maps and designs. He is the son of the late famous radio broadcaster Edvick Jureidini Shayboub of Lebanon who won various prestigious awards.
Architect Sarmad Shayboub has been always keen on creating new modern concepts in all his countless projects in Lebanon's capital Beirut and the country’s mountains.
In an exclusive interview with BUSINESS LIFE, Shayboub underlined the significance of modern architecture which enables society and investors alike to experience new international standards of quality right in the middle of the Lebanon and strategically situated in the Arab world.
The Constructors is Architect Sarmad Shayboub's real estate development firm focusing on architecture, engineering and contracting since 1972, and specializing in the development of its own residential buildings and towers. Additionally, the firm provides design and consultation services.
Among its projects, there is the ambitious Shayboub Tower in Hamra, Beirut which is already complete and being delivered with high end specifications throughout. Ten apartments are still available with sizes of 245 sqm, 290 sqm and 480 sqm.
A new project is also under construction in Achrafieh, Medawar Area, Saifi, Pasteur street, Medawar Plot 38. This project consists of a new residential tower comprising 14 floors with 120 Sqm, 130 sqm and 250 sqm apartments.
Lebanon's vibrant real estate and infrastructure sectors are targeted by investors from all over the world. The total number of built units’ transactions progressed by 2.23% y-o-y to 42,716 transactions worth $5.92B, while the total number of land transactions increased by 1.6% y-o-y to reach 41,664 at a value of $2.6B. Accordingly, the average land transaction value registered a 0.67% uptick to $62,709 by December 2016, while the average value per built unit transaction dropped by 1.16% to $138,629.
BL: Are construction projects on the rise in Lebanon?
Architect Sarmad Shayboub: All the construction companies are investing in construction all over Lebanon. Sometimes, their activity slows down; other times, it goes up. Now, it is the trend to become better and better because construction slowed down during the last three years. Currently, it started to pickup because of the political situation. All the Arabs found that Lebanon is a very safe place for investment. It was proven during all the events in the neighboring countries that Lebanon stayed all the time safe and much better than any investment around in the Middle East and across many places in Europe. I have been all around the world and all around the Arab countries in North Africa, Tunisia, Algeria and Egypt. There is nothing compared to what we have in Lebanon. I have been to Hammamet, Tunisia. I have been lately to Sharm el Sheikh. Really, I found nothing significant. Lebanon is the jewel of the Middle East and the Arab world. Investors should come and invest here because it is a safe haven. And we have the best weather, the best services, the best medical help and the best education. I do not know why Arab investors are not coming to Lebanon. It is really a question that puzzles me.
BL: Architect Sarmad Shayboub, with the progress in the political situation in Lebanon, do you put hopes that the Arab investors will target Lebanon?
Architect Sarmad Shayboub: They will come but not now, maybe they need more time to observe this new political stability. Possibly, in summer they will come. It depends on their governments if they let grant them the permission to come. If Arab investors come, it means that they want to invest, because they have no better places to invest in. They are investing in places in Turkey and Greece but they are not having a good time. Lebanon is a fantastic place for Arab investors.
BL: What are your major projects in Beirut and outside Beirut?
Architect Sarmad Shayboub: At the moment, we have only prime projects in Beirut because we found out that many people prefer to invest in Beirut. Many people want to invest outside Beirut and they do not use it. They invest outside Beirut but they do use it often. It is around one hour away from Beirut and they think it is beautiful. They will come few times and then they abstain from coming to their properties outside the capital: this is my personal opinion. My experience; I have many friends who built villas in their villages and spent millions of dollars for villas in their villages and they stay there and go there. They go few weekends and then they stop going there and later on they start looking for somebody to buy their property. I believe that the best investment now is in the capital. If you want to go far, for example, to skiing resort, go to hotel because you are not going to use it very often. It is not worth the investment. But if you come to Beirut and use it, you are using this investment and getting the advantage of having a house in the capital and from there you can go everywhere you want to go to the mountains, villages, touristic areas and beach.
BL: What projects do the Constructors have nowadays?
Architect Sarmad Shayboub: We have in Ras Beirut a very good project, one of the best apartment buildings around and they have an open view on the sea. We have few apartments still left with open view. We have a new project in Saifi area in Achrafieh that is overlooking the sea. It is under-construction.
In Ras Beirut we have 300 Sqm then we have 250 Sqm and we have the pent house of 500 Sqm which is open view on four sides. The other project is Saifi Achrafieh has 15 floors with apartments of 240 Sqm. Both towers have all extra luxurious facilities, underground parking, internet and sea view.
BL: Who is buying Lebanon's real estate (apartments, offices and lands)?
Architect Sarmad Shayboub: In the past few years, it was mainly the Lebanese who were buying Lebanon's real estate projects and we have also some Iranians and some Syrians. But before, there were many Arabs who were eager to invest in Lebanon. Currently, they are cautious, but I do not find any reason for anybody to be hesitant from investing in Lebanon.
BL: Your firm has worked under severe situations in war and post-war situations, are you ready to play a role in the reconstruction of Syria?
Architect Sarmad Shayboub: Yes, of course. Everybody likes to contribute to the reconstruction of Syria because it should start in few years. Lebanon will be the center of construction services and expertise because Syria needs assistance in this regards. Everything should pass through Lebanon.
BL: Are construction projects in Lebanon on the rise? Is competition in your sector a healthy one?
Architect Sarmad Shayboub: All the competition is conducted by professional experts. Other people do not compete, because they are outside the market for sure, especially at the present clients want the best work and the best quality of construction projects. Nobody will accept anything which is medium or minimum.
BL: Why is Lebanon's property market unlikely to boom anytime soon?
Architect Sarmad Shayboub: I disagree, because I think that this year, Lebanon's property market will move on. In the past few years, there was a lull or stability but then in 2017 it will move on again. Sometimes, Lebanon's property market moves like 15-20% a year and sometimes it will stay stagnant for many years.
BL: What is your opinion on Lebanon's office space & commercial real estate projects, pricing and sales?
Architect Sarmad Shayboub: Pricing depends on the value of land, because construction is plus or minus 10-20% from one company to other company, because pricing is linked to its specification, but the value of land is the important aspect in this matter. Land pricing in Beirut is becoming higher and higher. During the war, it was all the time going up and down, due to scarcity of land. We do not have too much land in Lebanon. Nowadays, we do not find land for sale except few pieces of lands that are inherited by 10-20 persons, and nobody can buy this land due to the inheritance laws in Lebanon. Many pieces of lands are inherited and cannot be sold, because one of the 20 or 30 people that inherited a piece of land do not want to sell. Consequently, to find a good piece of land to buy is very rare and should be at a very high price.
BL: What are you expectations for 2017?
Architect Sarmad Shayboub: It will go slowly. I have too many expectations, but for sure it will go up very slowly, and people who can grace this moment, will have a very good future in 2018 and the years to come because probably in 2018 there will be higher prices.
BL: Is there a divergence between purchasing power and real estate valuations? Does this exert corrective pressures on pricing?
Architect Sarmad Shayboub: For sure, because now the purchasing power is becoming less because the income of people is becoming less and the value of apartments is getting high. So, we have to decrease the value of apartments by decreasing the area. Before, engineers used to build 200 Sqm., now they build 100 Sqm. because few client afford to buy a 500 Sqm. apartment. But many people, who are living outside Lebanon have a lot of money and they want a big apartment, but they want the security. There is always a demand for small apartments 58 Sqm., 68 Sqm. because it is local demand. People are getting married and they want to raise families and they are willing to live in a small apartment. There is a high demand on small apartments but this demand is only in some areas, where the land's price is low. When the land price is low then engineers can build small apartments, because it does not reflect a high percentage on the land. So, if you have expensive land, you cannot build small apartments.
BL: The year 2016 was characterized by a shaky real estate sector nearing what might be described as a shaky real estate sector nearing what might be described as s "bubble", driven by political instability and unjustified valuations, is it true?
Architect Sarmad Shayboub: That is true, but they cannot bring down the value of apartments and construction. They keep the same. Although engineers keep the same, they are still losing 10%-15% every year. So, it is becoming less. If you have an apartment for one million dollar five years ago and now its price is still one million, you are automatically losing at least 70%. Hence, it is going down. Although the value of the apartment is still the same, but for sure for the buyers, it is getting much less than before five years, because it is the same price, but due to interest rate and because some developers borrow money from banks. So, the value is less.
BL: Is the political situation stable in Lebanon?
Architect Sarmad Shayboub: Yes, and it is a very safe country all the time. We have very good army and everything is very safe.
BL: Has the size of demand constituted by people who buy out of wealth shrunk substantially?
Architect Sarmad Shayboub: For sure, because those people that have lots of money already bought, and Lebanon is not such a big country, but we have every year 7 billion dollars coming from people living abroad and they pump money into Lebanon. That is why there is stability in the Lebanese pound. Nowhere in the world is like Lebanon. Nobody has 20 million expatriates outside Lebanon and they want to spend money in Lebanon and transfer money to their families. In Greece, there was a problem and there was nobody to send money except the European Union who wanted to help them.
BL: How do you compare real estate prices in Lebanon with those in other regional countries like UAE, Turkey and Jordan?
Architect Sarmad Shayboub: There is a big difference because the UAE we has a lot of land and you can have an apartment very easily. In Lebanon, we do not have lands. You do not find a good land. For Jordan, nobody wants to go and live in Jordan. You go there and stay two days in Jordan and then you want to come back though there are some touristic places. I went to the Dead Sea a few months ago; there aren't even nice and good restaurants. They are just old and outdated. Here, it is amazing. All the time, new projects of tourism, restaurants and clubs are opening. You go any time in the day, and you find new places, and at night nice clubs and open all the time. I was in Istanbul many times, there are four or five nice clubs, but they do not open except on Thursdays, Fridays and Saturdays. If you go on Monday, there are only restaurants.
BL: Do you have big hopes in the new President of USA? How will his policy reflect on Lebanon?
Architect Sarmad Shayboub: It is a big issue. It is not in the hands of President Donald Trump only. But it will reflect negatively on Lebanon.
BL: What are your hopes on the Presidency of Lebanon and do you believe that his plans for development will be realized in Lebanon?
Architect Sarmad Shayboub: It will happen eventually, because Arab people have big hearts and all of them care about Lebanon, but they are afraid of some political issues that are happening. Every country has its negative points. Now, you see what is happening in Turkey. Nothing is happening in Lebanon because we have security and a strong army. I hope things will change to the positive.
