Saturday, July 08, 2006

Holiday Inn, Downtown. What's Up?

Have you ever wondered why the Holiday Inn in Downtown Beirut remains a hollowed-out ruin; in stark contrast to its next door neighbor, The Phoenicia, and the rest of Downtown Beirut?

Well, to be honest with you, like the majority of Beirutis and Lebanese, I have simply reconciled myself with the structure, and come to see it as simply another part of the landscape. This phenomenon reminds me of how individuals living in former heavily mined war-zones simply get used to deadly contraptions in their environment, and live as if things were always that way - to them, the mines become "normal."

Anyways, going back to the main point of this entry: why is it that the Holiday Inn (one of Beirut's largest buildings) still awaits renovation? I always thought that it was such a large structure with so much damage that finding an investor willing to commit the necessary resources was, and remains, an impossible task. However, considering the amount of money currently being poured into Lebanon's real-estate and tourism industries, such a hypothesis simply falls apart.

Indeed, the problem is not, and has never been a lack of investors. The effective owners of the hotel (an investment firm linked to the Kuwaiti government) have been anxious to renovate the structure and launch a new hotel for quite some time now (i.e. years). Unfortunately though, they are faced with an obstacle that is an all too familiar one in Lebanon: tenants who pay rent based on the old rent laws, and who refuse to leave!

How has this happened? How does a hotel host tenants?

Well, it turns out that even though the building carries the Holiday Inn logo, it was never entirely a hotel! Rather, it was split into two sections of roughly equal proportions: one section was the actual hotel, and the other was an office building. And today, it appears that there are a handful of tenants who refuse to leave their premises, and in doing so, prevent the building’s owners from realizing their plans.

Considering the ordeal that the Holiday Inn is currently experiencing, I wonder what Downtown would have looked like today had Solidere not existed.

*photo courtesy of al Mashriq


Doha said...

Always something new from Beirut. I look forward to your refreshing posts.

As a fellow blogger from the beltway, I have not been writing, because there's nothing refreshing to talk about. Perhaps when I return to Lebanon in a few weeks, I'll see things from a different lens and my appetite for writing will return....

bashir said...

Good post.

There is always a legal settlement which involves some sum of money and the "tenants" will have to leave.

As for Solidere, it did not just deal with tenants, it "dealt" with the actual owners of land and property, "forcing" them to sell for sums which were far less than the worth-price. This is why we have the not-so-publicized problem the of the "owners of the rights" (ashab al houqouq).
It would be interesting if you could write a post about them.


libnanews said...

"The effective owners of the hotel (an investment firm linked to the Kuwaiti government) have been anxious to renovate the structure and launch a new hotel for quite some time now (i.e. years)."

actually i have heard the owners are a jap investment companie , their governement bought a land on the other side to establish their ambassy, this company thought about getting a hotel on the other side of it

Vox said...

They should abolish this damn law, at least for offices. I can understand that you protect families, but companies. The law is completely inneficient: I know plenty of rich people paying old rents, while relatively poor new married couples must pay new rents.

Charles Malik said...

The main problem is Lebanese property law.

Amazingly, Lebanon was ahead of the trend. We discovered REITs before the financial community invented them. The reason for this, originally, was inheritence law. A piece of Lebanese property is divided into 2,400 shares, which can be owned by 2,400 people. Hariri got around this in Solidere by transferring share ownership from a tangible asset to a stock certificate.

The problem is that in Lebanese property, unlike when one owns a share in a company, one shareholder can stop the majority shareholder or holders from taking any action. This makes sense when someone doesn't want to be kicked out of his home, but becomes ridiculous in situations like these.

Solomon2 said...

Ahh, I feel better. It's just like New York City...

Anonymous said...

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