Azizi Developments, a Dubai-based real estate developer, plans to expand its hospitality business outside the UAE, as it grows its portfolio on the back of improving global economic sentiment.
“In future, Azizi will go for hotel business in other countries,” said Mirwais Azizi, chairman and owner of the Azizi Group, which counts banking and investment among its operations as well as real estate development.
"We are looking at markets such as the Seychelles, Maldives and India – countries where there are high numbers of tourists," he said in an interview with The National at the Dubai Property Festival on Monday.
Azizi’s international team is working on early-stage plans and the group is targeting an announcement in the second half of this year, Mr Azizi said. He declined to reveal further details of any prospective deal, including the location.
The UAE property market has slowed in recent years on the back of a three-year oil slump that caused job losses and dampened demand, leading to ongoing declines in residential sales and rental prices. Analysts predict the market will continue to decline, at a slower rate, for much of 2018.
The sluggish conditions have prompted some developers to diversify their operations, with forays into international markets – such as Dubai’s largest real estate company Emaar Properties’ planned schemes in North Africa and Europe – and expansions into hospitality and other sub-sectors.
Last September, Dubai-based Union Properties created two fully owned subsidiaries in retail and hospitality – Union Malls and Al Etihad Hotel Management, the latter of which will develop and manage luxury hotels and furnished residences in Dubai.
Azizi entered the hospitality sector in April 2016 with its first serviced apartments project, Candace at Dubai’s Al Furjan, which the company said at the time was a Dh460 million scheme to be operated by Candace Hotels and Resorts.
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Mr Azizi told The National the group's hospitality development pipeline is full until 2020, with no plans to announce further schemes in the UAE or elsewhere until after Expo 2020 in Dubai. However, across all sectors, Azizi Developments' chief executive Farhad Azizi told The National last September the group planned to expand its presence to other emirates from 2018, including in Abu Dhabi, Sharjah and Ajman, where it already has land.
Azizi is currently marketing two community schemes in Meydan, close to Downtown Dubai – Azizi Riviera and Azizi Victoria.
Other projects include the newly completed Azizi Mirage 1 in Dubai Studio City, Azizi Grand in Dubai Sports City, and three residential buildings in Meydan Avenue, as well as a string of off-plan projects.
The developer is financing the construction of these developments through a combination of historic and current unit sales, together with around 10-15 per cent bank financing.
While the group is in “continuous talks” with banks, there are no plans to seek additional debt financing in 2018, Mr Azizi said.
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UAE currency: the story behind the money in your pockets
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
The smuggler
Eldarir had arrived at JFK in January 2020 with three suitcases, containing goods he valued at $300, when he was directed to a search area.
Officers found 41 gold artefacts among the bags, including amulets from a funerary set which prepared the deceased for the afterlife.
Also found was a cartouche of a Ptolemaic king on a relief that was originally part of a royal building or temple.
The largest single group of items found in Eldarir’s cases were 400 shabtis, or figurines.
Khouli conviction
Khouli smuggled items into the US by making false declarations to customs about the country of origin and value of the items.
According to Immigration and Customs Enforcement, he provided “false provenances which stated that [two] Egyptian antiquities were part of a collection assembled by Khouli's father in Israel in the 1960s” when in fact “Khouli acquired the Egyptian antiquities from other dealers”.
He was sentenced to one year of probation, six months of home confinement and 200 hours of community service in 2012 after admitting buying and smuggling Egyptian antiquities, including coffins, funerary boats and limestone figures.
For sale
A number of other items said to come from the collection of Ezeldeen Taha Eldarir are currently or recently for sale.
Their provenance is described in near identical terms as the British Museum shabti: bought from Salahaddin Sirmali, "authenticated and appraised" by Hossen Rashed, then imported to the US in 1948.
- An Egyptian Mummy mask dating from 700BC-30BC, is on offer for £11,807 ($15,275) online by a seller in Mexico
- A coffin lid dating back to 664BC-332BC was offered for sale by a Colorado-based art dealer, with a starting price of $65,000
- A shabti that was on sale through a Chicago-based coin dealer, dating from 1567BC-1085BC, is up for $1,950
