Dubai:
The Palestinian developer Massar International is looking for investor support for its Rawabi development in the West Bank. Located 30 minutes north of Jerusalem, the high-end hilltop units are being developed by Bayti Real Estate Investment Co., a joint venture between Massar International and Qatari Diar.
Massar International’s Chairman, Bashar Masri, is hopeful his bid to attract “Palestinians living abroad who may want to buy a summer house or an apartment” will gain enough traction to start funding the project through off-plan sales and investor funds.
“The risk they’re (Qatar Diar) taking is one that banks don’t normally take — we would like to see banks participate, but realistically banks see Palestine as a higher risk,” Masri said.
London-based Coline Schep, Associate Analyst for Middle East and North Africa at Control Risks, said most commercial banks in the West Bank focus on directing investments overseas. “Commercial lending practices [in the West Bank] are quite conservative and in many cases commercial banks will require loans to be more than 100 per cent collateralised with land or personal guarantees.”
Massar is already building 5,000 affordable housing units for up to 25,000 residents in the city, which has been funded at a cost of just over $1 billion by Qatari Diar. Masri expects to attain breakeven on the project but said profit margins would be slim. The developer needs to sell 4,200 units to breakeven, according to Masri, and very few units have been sold off-plan.
Construction on the 5,000 units came to a halt during the latest Gaza war. “Buyers naturally stopped,” Masri said, “but now it is picking up again.”
The development has also had delays as it awaits Israeli authorities to approve water supply to the city, which passes through Israel, according to Masri. It is unclear when Israeli authorities will grant approval and until then no one can move in, he said. Despite the delays, Masri is hopeful of “several hundred families” moving in over the next four to six months.
