Solidere

Solidere s.a.l.
Joint-Stock Company
Industry Real estate
Founded 1994 (1994)
Founder Rafic Hariri
Headquarters Beirut, Lebanon
Area served
 Beirut Central District
Key people
 Nasser Chammaa (Chairman), Mounir Douaidy (General Manager)
Slogan Places for Life
Website www.solidere.com

Solidere s.a.l. is a Lebanese joint-stock company in charge of planning and redeveloping Beirut Central District following the conclusion, in 1990, of the country’s devastating civil war. By agreement with the government, Solidere enjoys special powers of eminent domain as well as a limited regulatory authority codified in law, making the company a unique form of public-private partnership.

Solidere was founded on 5 May 1994 by then-Prime Minister Rafik Hariri and was incorporated as a privately owned company listed on the stock exchange. The name “Solidere” stands for Société libanaise pour le développement et la reconstruction de Beyrouth, French for “The Lebanese Company for the Development and Reconstruction of Beirut.”

Projects

Solidere is widely credited as the most important force behind Beirut’s reemergence, in recent years, as a bustling urban destination with a chance to earn back its pre-war title of “Paris of the Middle East". Solidere's main functions are the supervision of the government-authorized reconstruction plan, financing and developing the infrastructure, new construction and rehabilitation of war-torn structures, urban landscaping and the management of property.[1] Solidere has worked to attract global retailers such as Virgin Megastores to Beirut Central District. The company’s most significant single project to date has been Beirut Souks, a 100,000 m2 retail center that was scheduled to open by year 2008, however opened in 2009. Other projects that are central to the company's cultural strategy for the center are the Beirut Exhibition Center, add Saifi Village - Quartier des Arts, a residential neighborhood with a high density of design shops and art galleries.

Controversy and challenges

Solidere was founded after the government chose the framework of the public-private Real Estate Holding Company (REHCO) as the most viable option to reconstruct the central district, which was severely damaged and demolished, and emptied of its pre-war economic and demographic activity. Some research points out that the REHCO solution was the only viable option.[2] The practical nonexistence of a functional government after the war, and the near-impossibility to align all stakeholders -including property owners- onto one unified and feasible vision, called for private resources to plan and execute a project of such scale and importance. Hariri's credibility as a business person, and the speed and efficiency of submitting plans and investments models all played in favor of the REHCO model. It can be argued that, without this large-scale intervention, the center would have at best re-developed in a chaotic and uncoordinated manner, the way other areas of the capital are experiencing.

The first axis of controversy relates to the mechanisms and masterplans of the reconstruction. Several opposition groups emerged to challenge the REHCO model and propose alternatives to it. Among those was a group of academics and urban planners who fueled a public debate about the goals and methods of reconstruction -especially the large-scale demolition and re-design as outlined by an initial plan submitted by Dar Al Handassah. Other critical views saw the plan as disconnecting the center from the rest of the city's fabric[3] and transforming it into an "island of modernity".[4] The contested plan was consequently changed, with the participation of some of the architects from the opposition groups- to take into account some of the key points raised. A modified plan emerged, and was evaluated by the Engineer's Union, but never approved by the public before being sent to government.

The second axis of controversy relates to the mechanism of property expropriation - deemed forced and enabled by Capital's pressure on the government and Hariri's influence as PM- and the valuation of property - deemed inappropriately low. By law, the company had six months to secure the necessary cash subscriptions to balance out the land value. Were it not for this conservative valuation of land, the whole project would have collapsed at a time when the government had no alternatives.[5]

Financials

Solidere’s shares are listed on the Beirut Stock Exchange, and its Global Depository Receipts trade on the London Stock Exchange. Its share price on the Beirut exchange has risen sharply in recent years, from about US$5 in early 2004 to a high of $39 in September 2008. Between 1995 and 2015, Solidere has approved more than $1B in dividends to its shareholders.

Solidere's 36,000 shares are owned mostly by Lebanese shareholders, in addition to Arab nationals, banks, and Arab or international funds. Rafik Hariri's share in the company has been a controversial subject in the Lebanese political spectrum. Some rumors say that he owned a majority stake in Solidere before his assassination in 2005, and the Hariri family continues to be a principal shareholder today. However, the Hariri family rejected those rumors saying that Rafik Hariri owned only 6% of the company's shares.[6] However, Solidere's bi-laws prohibit any shareholder from acquiring more than 10% of the company's capital, either directly or indirectly.

See also

References

  1. ↑ Elsheshtawy, Yasser (2008). The evolving Arab city: tradition, modernity and urban development. Planning, history, and the environment series (illustrated ed.). Routledge. p. 314. ISBN 9780415411561. Retrieved 17 October 2009.
  2. ↑ Middle East Economic Consultants. Feasibility Study for Beirut Central District. Beirut. 1985
  3. ↑ M. Davie. Discontinuites imposees au coeur de la ville: le project de reconstruction de Beyrouth. Edition de la Maison des sciences de lhomme dAquitaine, Bordeaux, 1990.
  4. ↑ Saree Makdisi, “Laying Claim to Beirut: Urban Narratives and Spatial Identity in the Age of Solidere,” Critical Inquiry 23/3 (1997), 661-705.
  5. ↑ H. Schmid. The Reconstruction of Downtown Beirut in the Context of Political Geography. Arab World Geographer, 5 Spring(4):232248, 2002.
  6. ↑ "Verbal clashes". Ya Libnan. July 2006.

External links

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