'Every project that we're developing is for the sake of people that live and work there'

Property Weekly speaks to Merwiss Azizi, Founder and Chairman of Azizi Investments

Azizi Investments has built up a land bank in the UAE that is not to be taken lightly, including several plots in Nakheel's Al Furjan and the prestigious Palm Jebel Ali as well as in Dubai World Central and Ajman's Emirates City.

But this is just the rollout phase - it wants to have well over 100 million square feet of land in its possession within the next two years itself.

The eco-conscious developer's heavy investment into UAE's realty is one story, but its origins are probably even more interesting.

Its founder and Chairman Merwiss Azizi left Afghanistan around 20 years ago. He found his first break with a mere $700 in his pocket in Uzbekistan and Bulgaria, and then made his first million dollars within six months by trading in the petroleum business in the CIS.

He then headed to Dubai founding the Azizi Hotak General Trading Group and expanded into 10 countries.

As the main importer of LPG and refined petroleum products into Afghanistan, a network of petrol stations and the creation of Azizi Bank and the American University of Afghanistan, it is clear he has not abandoned his country.

Property Weekly had a chat to find out what else this tenacious figure has in mind for the UAE and Afghanistan.

Will you take your real estate development expertise gained in Dubai back to Afghanistan?
The government of Afghanistan wants to create a 'new' Kabul and the Vice-President recently asked me to help construct the new city, I will once the masterplan is provided.

I also plan to build more student accommodation for the American University of Afghanistan I founded and the design for my five-star hotel near the Presidential palace is ready.

Your track record is impressive, you are one of the few who made it against all odds. So, what's next for those still in Afghanistan?
People are looking for safety and peace, they want to have their own houses. To achieve that they need money, employment and education. Those who lost out on the same due to the wars, now in their 30s, need to be trained.

I already have a training centre through my bank and employ 400 women, some of them even head the bank's branches.

I also want to train half-a-million young people to become drivers as well as carpenters, electricians, etc, to work in construction, and push the government to sign an agreement with countries in the Gulf so they can come here, gain more skills and earn money to support their families.

I create education and jobs. This is my way of contributing to the country.

What is holding you back? The deteriorating security and rampant corruption?
I have invested $400 million and built petrol stations and LPG storage tanks, but worsening security over the last two years has delayed the completion of all of them for another two years.

The main problems affecting security is too much corruption in government and cross-border Al Qaeda activity, but the good news is that Pakistan seems now willing to do something about it.

The government needs to provide more assistance to local and foreign investors to create jobs so people can live in a crime-free ambience.

I hope the elections will bring a government with good governance, which stops corruption and makes sure the donor money gets channelled where it's supposed to go and not into the pockets of some.

I am positive the elections will bring change, democracy and involving women in the economy is possible.

Will you channel profits made from real estate here back into Afghanistan?
I invest money back into my businesses wherever it's needed. Azizi Investments (the real estate arm) in the UAE is not even one-year old.

I will pour the money back into the company, a lot of investment is still required here to build and grow in the region.

Are you looking at expanding beyond the UAE?
I believe that the foundation of a company must be very strong and you have to prove yourself before you enter other markets. So we won't go anywhere before 2010, then we're looking at expanding into Eastern Europe.

And of course elsewhere in the UAE, 10 to 15 per cent of our projects will be in Abu Dhabi and may be other emirates as well. But for now we're concentrating on Dubai.

You do already have one project in Ajman?
Yes, in Emirates City we hold the exclusive rights for the only five-star hotel there.

But we're waiting right now for the escrow account and all the other laws to be in place before we start. They have been announced but we haven't seen them officially.

You have announced five projects on the Palm Jebel Ali before and during Cityscape. Why this Palm?
It's a flagship project like the other Palms, no one else in the world has anything like it.

We have five plots on different crescents and it is the ideal place to create our luxury towers with retail components, over 1.4 million square feet of built up area.

Each one is being designed with the finest detail in mind and high-tech solutions, for example the lifts scan your retina and we're working with voice activation as well.

We want to make sure we represent The Palm - the design process took several months of going back and forth to consider Nakheel's requests.

What did Nakheel's requests for design changes entail?
They all had to do with sustainability, natural sources of energy and the like to make sure that the project itself is friendly to the environment. We're going for the Gold standard and may have to exceed international standards.

It is quite an expense to go for LEED Gold. What will you price your property at?
We're aware of the costs and considered them in our planning. In our Mina Rashid project we're even going for platinum.

All of our projects, especially the luxury projects, will offer everything the end-user needs and supersede their expectations. We will have helipads on each building and I handpick the customised musical fountains to go in front of each building.

Prices are not going to be much out of line with the going market price. We're not about short-term profit, but a long-term vision.

Are all your projects about the ultimate luxury residential towers or are you looking at affordable housing as well?
I want a holistic portfolio with a range of offerings. We chose to build 12 apartment buildings in Al Furjan because of the Arabic heritage behind it. It's a family community and we're selling at a very reasonable price.

In Dubai World Central we're the largest private developer with 11 plots totalling 627,00 square feet, and looking at building low-cost housing within the logistics city for employees as well as commercial properties.

On The Palm its luxury and we're in negotiation to buy land in Dubailand next year to build villas among other projects.

There is a lot of talk now about reducing the number of speculators to focus on end-users, what is your strategy?
We concentrate on dealing with the end-users directly. Of course we also have investors, but every project that we're developing is for the sake of the people that live and work in them.

Is that why your portfolio to finance the developments is so diverse?
Yes, we do not rely on off-plan sales although they partly finance construction always held in escrow accounts.

But they form only one part of the total investment into our projects, there also direct investments from our group assets of about 30 per cent, and we negotiate on a regular basis for third-party financing from several sources.

What are your thoughts on corrections, the effect of the recent bribery allegations and the global financial crisis on Dubai's real estate market?
The real estate market in Dubai is not even comparable to the US or Europe, right now this is the only place that's booming.

In the US most of the public takes loans from the banks to buy a house. So if they lose their jobs they can't pay the bank back and the price of property comes down.

Then the bank is not able to sell his property for the same amount that the bank paid to him leading to bankruptcy if the government doesn't bail them out.

A lot of people come to the UAE with cash, only a very small percentage here takes finance from banks, so we don't have that problem.

Secondly, corruption in big real estate companies can lead to market fluctuations, but the government here is rooting it out and that is very good as more people start trusting the system. When you stop corruption in the real estate business you send it in the right direction.

Plus the government of Dubai is putting in very good regulations in the real estate business, especially this year with the emergence of the escrow account, prohibiting developers to sell anything before all approvals are in place, etc.

Basically, a lot of safety systems have been put in place and the sector will just become even better.