Lebanese fund turns to diaspora to revitalise real estate

Dark apartment windows vastly outnumber the lit in the quiet night streets of Beirut’s waterfront and central districts, a reminder of Lebanon’s long economic and real estate slump.

Such unsold luxury properties are now being targeted by the country’s first real estate investment fund, which the founders hope will help revive what was once a main driver of the Lebanese economy.

Legacy Central, which aims to raise $1 billion in equity and debt in three $325 million stages, says it will invest wholesale in apartments which developers have been struggling to shift for years, selling them on to Lebanon’s extensive diaspora.

“There are lots of young Lebanese living in London specifically who are an excellent target market,” Legacy Central Chairman Massaad Fares told Reuters, adding that the fund expects to make its first close by the end of the year.

Real estate activity and prices have fallen since the outbreak of war in neighbouring Syria in 2011, which heightened regional and domestic political tensions and caused at least 1 million refugees to seek shelter in Lebanon.

The slump may have started in luxury properties, but it has filtered down through the market as Lebanon’s stagnant economy and government vacuum weighs on confidence and spending power.

In 2013 the Gulf Cooperation Countries advised its citizens against travel to Lebanon and since then wealthy Gulf Arabs have been selling property in the formerly popular tourist spot widely seen as more socially liberal than other Arab countries. (RTRS)