Plots scarcer in Beirut. How to face it?
A strong demand for plots with a limited supply have been reported in this small country particularly in the capital.
If however today, land plots have become rare in many locations in Beirut, where do developers turn to?
Land plots are becoming scarce and that is particularly difficult to find underdeveloped land in prime areas with the Beirut Central District (BCD) being the only notable expensive, said property advisory firm Ramco. As such, two options remain open for prospective developers. Some start to invest in under developed peripheral areas of the capital such as Corniche Nahr just outside of Asrafieh and Jnah. Others prefer to build in central prime locations by replacing old buildings with new projects.
The top five land destinations where do developers buy now are namely Corniche Nahr, Furn el Hayek, Hamra, Beirut Central District (BCD), and Jnah as reported by Ramco.
Corniche Nahr, however, is one of the last remaining land reserve of Beirut with thousands of square meter raw land that is easy to develop with land price ranging from $800 to $1,400 per sqm of BUA, according to the report.
Few empty plots are available in Furn El Haket which is densely populated. “Excessive demand put high pressure on built up plots which is resulting in the savage destruction of vantage houses surrounded by gardens resulting in reducing the green space in Beirut, the report said. In this area, land price ranging from $1,800 to $2,000 per sqm of BUA.”
Hamra has been renewed with food and beverage attractions, this has made the area attractive for commercial development and hotels. Land prices range from $1,800 to $2,200 per square meter of BUA.
BCD posts some the most expensive land prices in Beirut ranging from $3,500 to $5,000 per square meter of Built up Area (BUA). One of the advantages of buying in BCD is that Solidere does not charge for the BUA of balconies therefore this offers customers greater value of money, Ramco said.
Ramco indicated that the lower exploitation area in Jnah, explains the high price of the BUA of land ranging from $1.200 to $1,500 per sqm of BUA. It’s one of the rare areas of Beirut that offers wide stretches of flat underdeveloped, empty plots of land. The area, however, attracts a closed niche market both of developers and end-buyers. It’s the same group of investors who repeatedly build in the area and who sell to a tightly-knit network of Lebanese expatriates mostly living in Africa.
In recent years, the demand for land plots in strategic and attractive locations had pushed up the price of land in prime locations and made reasonably priced plots a rare phenomenon.This demand has also increased property prices. Since 2005, Beirut property values have surged up to almost 25 percent per year, slowing in 2010 to a growth rate of 10 percent.
A report published by Bank Audi on the real estate market in July 2011 said that the supply side of the residential market has been acquiring land at higher cost over the past years with available land plots increasingly scarce in the capital and as a consequence declining gradually in the outskirts of Beirut on one hand and developers looking to much steady demand by acquiring plots in trendy areas on the other hand.
As such although developers have been lately been less eager to purchase plots at sometimes very elevated price, land prices remain sticky on the downside weighing on end-user prices, Bank Audi report stated.
STRATEGIES & PLANS
A fundraising event, entitled Think Green, will be held by Zero Waste ACT for all its business members on September, 10,2013, at WHITE, Dora.
The Green Mind Association invited all Green Mind Award Participants, finalists, runner ups and winners to the GREEN MIND DAY on Jan-16-2013 in Beirut, to create a platform where interested Venture Capital and Potential Investors met with participants.
A green initiative launched by Ashrafieh 2020 project aims to transform Ashrafieh into a tranquil and unpolluted area.Green spaces allow residents to walk and ride bicycles.