EXCLUSIVE: Developer says 25 percent of units on US$40m Marrakech project already pre-sold
Abu Dhabi-based Tasweek Real Estate Development and Marketing is aiming for a 30 percent return on investment (ROI) from a US$40m Morocco healthcare project set to officially be unveiled on Thursday, the firm’s CEO told Arabian Business.
Marrakech Health Care City will be around 21,000 sqm in size and will include a 160-bed private hospital, a 40-room boutique hotel and 56 residential apartments. The development is set to break ground on Thursday.
Masood Al Awar, Tasweek CEO, said that the developer had already notched up a number of pre-sales on the residential units and was in negotiations with operators to manage the hotel.
“On the pre-sales of the units, we’ve already sold 25 percent of the residential [units], to local investors,” he said in a telephone interview from the Moroccan capital.
“We’re talking to a couple of international operators and a local operator, and there is some bidding going on. We expect within the next quarter we’ll finalise the operator, which could also be extending their operation into managing the apartments as well,” Al Awar added.
Construction of the project will take two years, according to Al Awar, by which Tasweek anticipates that it will have recouped its entire investment on the development. “The return [on investment] on the project will be around 30 percent,” he said. “The return should hopefully come before 24 months (the projected construction timeframe). That is the timeframe we’ve put in and we’re moving towards it very conservatively.”
Al Awar said that Tasweek’s entire US$250m property portfolio had a annual yield of “5 percent to 7 percent”.
Morocco, which was spared the worst of the Arab Spring political turmoil that swept across the region, has been increasingly seeking investment from the Gulf countries.
In October, the North African state’s monarch King Mohammed embarked on a tour of the six-state GCC in a bid to drum up investment. While the Gulf countries last year pledged US$2.5bn in aid to Morocco, the only GCC state among the country’s current top ten trading partners is Saudi Arabia.
Al Awar said that Morocco was eager to attract investment in areas such as healthcare and education. “The local banks in Morocco are very supportive when it comes to the major industries [like] healthcare and education,” he told Arabian Business.
While previously operating as a financier or joint partner, Tasweek has increasingly moved into the development sector and earlier this year it announced it had signed a joint venture agreement to develop, own, operate and market luxury properties in Malaysia.
The deal was with Casabrina Vacation Villas and, under the terms of the venture, Tasweek will market nine boutique Villa hotels under a Shariah-compliant scheme.
The villas are spread over 30 acres of hillside land surrounded by a 130m-year old virgin rainforest just under an hour's drive from the Petronas Twin Towers in Kuala Lumpur.
Upon completion, the complex will comprise eleven exclusive six and eight-bedroom suites nested at the foothills of Bukit Frasier in Pahang, the largest state in west Malaysia.
The project is due to start handover at the end of next year and it is now 95 percent sold out, Al Awar claimed. “It is a very good result. The project value is around US$86m and [financing] is completed now.”
Al Awar also said the company was looking to Saudi Arabia as a growing market. “We are at the moment trying to establish our contact and in the next two quarters for sure we will confirm our joint venture and start…. [Saudi Arabia] is a huge market and has an organic market and the real estate components are very attractive,” he said.