I am legend

Michael Schumacher explains why he's the latest celebrity to get behind Dubai's property boom.
I am legend
By Anil Bhoyrul
Sun 03 Feb 2008 04:00 AM

Michael Schumacher explains why he's the latest celebrity to get behind Dubai's property boom.

The previous two times I have tried to interview Michael Schumacher, things didn't quite go according to plan.

It is one thing to be successful in sport, but it is another to have a building named after you.

In May 1999, his public relations entourage ejected myself and my photographer from the starting grid of the Monaco Grand Prix before I even got in one question. Two years later in Sao Paulo, he agreed to a "lifestyle" interview. I asked eight questions, he answered none.

Time changes everything. "There is life after Formula One, I can assure you. And it has been a pretty good life so far," he says.

It certainly appears so. By taking off his red Ferrari driving suit and racing boots, Schumacher has also unburdened himself of the burden, passion, intensity and demands of the sport. He is dressed casually in a long jumper and trainers, and seemingly without a care the world. The handshake is warm, firm and genuine.

"Now I can do things I could not do before. I get to do crazy things. When you are in F1, all you do is F1," he says.

One of those things is his arrival in Dubai last week to promote the Michael Schumacher Business Avenue, a US$300m, 29-storey office tower in Business Bay. Launched by German-owned ACI Real Estate, the development is the first ever building to carry the Schumacher name.

ACI boss Robin Lohmann persuaded the F1 legend to sign up, as the branded buildings craze hits the emirate - ACI is also behind Boris Becker Towers and Niki Lauda Twin Towers. And another handful of sporting mega-stars are being touted to stick their names onto Dubai property projects. Lauda came to Dubai last year to launch his building and Becker will be in town on February 24.

But Schumacher is the biggest coup of all for ACI. Neither Schumacher nor ACI will disclose any financial details of the deal, but hiring the F1 legend doesn't come cheap.

According to Zachary Nadler of New York-based All American Speakers, which manages some of Schumacher's engagements, it costs US$250,000 plus a private jet, for him just to show up. Given the huge marketing campaign undertaken by ACI, it is likely the whole "Schumacher coming to Dubai project" has cost well over US$1m. And it seems like money well spent, although Schumacher himself didn't need much persuading.

"It is one thing to be successful in sport but it is another thing to have an entire building named after you," he says, adding: "When I was told about it, it was only natural that I would follow it up.

"Then I decided I wanted to be more involved with this, and in the end was proud to be asked to be part of it. And this is just the start. There are further projects we are looking at."

European brand consultants PNYG hold Schumacher's licensing rights, and are currently working on seven "Michael Schumacher World Towers." Other projects, including more in the Gulf, are also said to be under consideration.

"I like Dubai. I have come here many times before - when I was racing I would often come here in the winter for testing. Every time I have been here before the place has been good to me, but the pace of change you see always amazes me. It is a special place, there is no doubt about that. You will see more projects like this in the future," says Schumacher.

The deal with PNYG was struck three years ago, and now - having fully retired as a racing driver - Schumacher has his eyes peeled for similar opportunities.

"With PNYG, which is our direct partner, we developed a plan to go in this direction. Robin Lohmann contacted us and we have had a very efficient partnership ever since. There was an idea and there was a will. We found very quickly the need for the project and so we managed to get together very quickly. It's not the first time that I have been asked to put my name to a tower, but it's the first time I have accepted. In many directions I believe that Dubai offers a lot of potential. But on the other side, I think that if you are going to invest in something then you should know the market first," he says.

The life of a living legendMichael Schumacher was born January 3, 1969, in Hürth Hermülheim, Germany is a former Formula One driver, and seven-time world champion. According to the official Formula One website, he is "statistically the greatest driver the sport has ever seen".

He is the first German to win the Formula One World championship and is credited with popularising Formula One in Germany. In a 2006 FIA survey, Michael Schumacher was voted the most popular driver among Formula One fans.

After winning two championships with Benetton, Schumacher moved to Ferrari in 1996 and won five consecutive drivers' titles with them from 2000-2004. Schumacher holds many records in Formula One, including most drivers' championships, race victories, fastest laps, pole positions, points scored and most races won in a single season.

Schumacher is the first and only Formula One driver to have an entire season of podium finishes (2002). His driving sometimes created controversy: he was twice involved in collisions that determined the outcome of the world championship, most notably his disqualification from the 1997 championship for causing a collision with Jacques Villeneuve.

On September 10, 2006, Schumacher announced his retirement as a driver. Schumacher is currently assisting Scuderia Ferrari CEO Jean Todt for the 2007 Formula One season. Off the track, Schumacher is an ambassador for UNESCO and driver safety.

But anyone planning to follow ACI's example should think long and hard. Schumacher is no ordinary celebrity ready to endorse every project that comes his way. He has insisted on a special project board of directors being created to oversee the development, which comprises Robin Lohmann, the ACI chairman, Schumacher himself and his personal manager.

"I don't just put my name to something; I want to make sure it works. This is something that has been researched for over two years," he says.

I don't just put my name to something; I want to make sure it works. This is something that has been researched for over two years.

So can we expect Schumacher to chair stormy board meetings every quarter? "Luckily we have a fast growing world of technology and communications. I don't think it requires me to physically sit at the table. But I like to know what is going on," Schumacher says.

Lohmann is sure to keep him informed, as he attempts to lead the race for branded buildings. In less than two years of trading in Dubai, ACI has revenues topping the billion dollar mark.

So far the company has launched Victory Bay and Sami Tower in Dubai's Business Bay, Dubai Star in Jumeirah Lake Towers and Wings of Arabia in Dubailand. With his sports-branded developments now off the mark, car-branded buildings are on the drawing board, again for new projects based mostly in Dubai.

"It is simple. We develop and we flip. We make people money. There is a lot of talk about the property market not being sustainable but those people talking that way - well, they don't know what they are talking about. There are still millions of people forecast to move to Dubai in the coming years. They all need somewhere to live and work. Prices will keep rising and I actually think we can double our turnover next year," says a confident Lohmann, adding: "As for the idea of branded buildings, well again it is a simple equation. What would an investor pay more for - Number 1 Business Avenue or Number 1 Michael Schumacher Business Avenue?"

Lohmann adds: "Michael gets a lot of offers as you can imagine, and he is a very wealthy man. He doesn't exactly need money. He is more concerned about protecting his image and his brand. I know he has turned down a lot of other projects, but he saw the value in this one and the deal was done very quickly. There are not going to be F1 museums and that kind of stuff - it is just a high-quality building branded with his name. Even without the name we are talking about a premium office space opposite the Burj Dubai. You add the Schumacher name and you get a lot of added value."

Lohmann is convinced that Schumacher is doing these projects because he believes it has a strong market value - the ex-world champion certainly doesn't need the cash: a quick calculation of his basic salaries, bonuses and prize money during his 15-year F1 career - where he was world champion seven times - brings you to the US$600m mark.

He has a massively successful merchandising operation that is thought to bring in around US$120m a year, for products ranging from watches to even vacuum cleaners. Cash is still pouring in from the two Ferrari books he collaborated with, and he has licensed his image to computer game makers. It doesn't take much to work out that the Schumacher industry is worth over a billion dollars.

That said, although he has stayed out of the celebrity limelight as much as possible, the builder's son is known for his extreme generosity. The 38 year-old is reported to have been the single biggest donor to the Tsunami victims appeal, handing out US$12m in cash. Around US$50m has gone towards building schools and orphanages in Peru and Senagal, the Times newspaper reported last year.

"I have had a charity foundation for several years. It depends where I feel there is a need to do something, and where there is we try and do something," he says, adding: "There are a lot of sad happenings all around us. Some can do more, some can do less. I want to do what I can.

"Life is about balance. There are a lot of things that I am involved with that I have never spoken about, and that I never intend to," he says. Since retiring as a racing driver, it has not been totally clear which direction Schumacher will ultimately head in. He returned to Ferrari last year as a consultant, appearing on the pit wall and in the garage at several key races, though his body language suggested he wasn't totally comfortable in the new role.

Since then, he has become more involved in testing for Ferrari, though his advisors insist there is no chance of him taking over any F1 team.

Instead, now appears to be the first time in 15 years he can properly relax with his wife Corinna (also in Dubai with him) and their two young children. The family is thought to have bought a farm on the banks of Lake Geneva, and more time than ever is spent on skiing holidays.

But surely he misses the buzz and the thrill of a race? "You can think that if you want to, but I was in motor sport for more than 30 years. There was nothing more that could motivate me. But you know, in life, there are still many challenges that lie ahead. I am not the kind of person who can just sit in the corner and do nothing."

It is likely Dubai has not seen the last of the legend.

The brand businessThe Michael Schumacher Business Avenue is the third branded project that ACI is behind - Boris Becker will launch the Boris Becker Tower in late February, with another former F1 star Niki Lauda having already endorsed the Niki Lauda Twin Tower.

ACI boss Robin Lohmann is convinced he is onto a winner.

"I think the market for this kind of thing is going to grow hugely. If you look at the Porsche Design Tower it is going for US$680 per square foot - that's 25% more expensive than our most expensive tower, so there is still a huge gap there. I don't see any sign of the market burning out. Look at the US right now and rental incomes there are around 5% a year. Over here it is between 9-12%. If the market comes down, then let it come down and you will still end up making money," he says.

What Lohmann has going for him in a big way is that most of his projects are over 90% sold out before launch. His healthy spread of investors have done well for themselves and are keen for more action.

"We have delivered them profits so a lot of them are looking for repeat business. There is a lot of choice out there in the market but we have found properties where the premiums are good. You go in at one price and you come out at a higher price. That is good business! Whatever other factors are out there are not really an issue," he says.

But what about the end user? "Well he still ends up with a very high quality building at a good price with rental returns far better than any other market. You can make all kinds of arguments about the dollar sliding and what would happen if US interest rates changed. The list goes on. But the facts remain the same, which is that property in Dubai is an extremely good investment. Otherwise we wouldn't be doing this, and otherwise, we wouldn't as a company be growing as fast as we are."

ACI was founded by Lohmann's father Uwe, and Robin Lohmann himself first came to Dubai in 2004. At the time he was living in New York, working in finance.

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