On Friday, January 21, 2011, the Faculty of Business Administration and Economics at Haigazian University organized a seminar entitled “Real Estate Sector in Lebanon – Challenges and Opportunities.”
The lecture was the second in the series of lectures/conferences anticipated for the 55th Anniversary of the University.
President Rev. Dr. Paul Haidostian welcomed everyone, and shared with the audience the inauguration of Haigazian’s new Heritage building on May Ziadeh Street back in Spring 2010. “We said that we are hoping to bring our share in the overall evaluation of our streets here: material, moral and cultural evaluation”, Haidostian said.
Haidostian added that today, when one talks about Haigazian University, one cannot help but think about the value of its land, irrespective of most other values or lack of them.
Dean of the Faculty of Business Administration and Economics, Dr. Fadi Asrawi highlighted the recent growth in the real estate sector in Lebanon, regulated by the forces of demand and supply.
“The demand for real estate in Lebanon is due to several factors: the increasing number of Lebanese domestically, expatriates returning to Lebanon and foreigners, mainly Arab nationals from the Gulf, who have been investing increasingly in the local realty market,” Asrawi clarified.
Asrawi concluded with the shift in construction in 2010 to areas north, south and east of Beirut, which have more affordable prices, adding that from an economist’s point of view, this growth is “both normal and natural.”
Providing the private sector’s perspective on this issue, Mr. George Badawi, Vice President of Badawi Group, discussed the outlook of private developers for the coming 5 years, tackling challenges such as the rising cost of land and the legal and technical procedures. Badawi also touched on the role of private banks as well as the central bank from the perspective of a developer.
The following speaker, Dr. Makram BouNassar, Acting Director of the Foreign Affairs Department of the Central Bank of Lebanon, asserted the central bank’s role in financial stability by “maintaining exchange rate stability of the Lebanese pound against the US dollar.”
He added that “we do not have a real state bubble in Lebanon and we do not expect one. Real state prices in Lebanon have readjusted according to the conditions of the market, and that the Central Bank of Lebanon had set a ceiling of 60% on bank loans for real estate projects excluding housing loans to avoid any real estate bubble.”
Mr. Philippe El-Hajj, Deputy General Manager and Head of Retail Banking Division at Fransabank, noted that their real estate transactions had an average increase of 30% from 2000 to 2010, with an even greater increase in the value of these transactions (in USD). El-Hajj emphasized the growth rates in different areas of Beirut, with Ashrafieh in the lead with a 32% increase between 2009 and 2010.
The final speaker was Mrs. Raghda Jaber, a consultant providing the perspective of the Ministry of Finance, who indicated that “13 to 15% of state revenues come from real estate transactions.”
Jaber discussed the Cadastre Operations Modernization and Automation Project (COMAP), which aimed at improving guarantees for real property owners, focusing on automation.
According to Jaber, new software specifically designed for Lebanon “has the capacity to provide effective and transparent services and allows banks to access mortgages from remote locations” and will generate greater revenue for the government.