Alabbar – the Man Who Built the World's Tallest Structure [analysis] (

Mohamed Alabbar is founder and chairman of Emaar Properties, one of the largest real estate development companies in the world and known for developing the BurjKhalifa, the world’s tallest building and the Dubai Mall, the world’s largest and most-visited retail and entertainment destination. Alabbar is also founder of Abu Dhabi-based Eagle Hills, the developers of the Centenary Cityin Abuja and acts as a top adviser to Sheikh Mohammed bin Rashid Al Maktoum, the leader of Dubai. DemolaOjo was part of a team that heard him reveal how he built his empire and plans regarding Nigeria…
“It’s interesting. My family lived in government housing. I remember when I graduated from university and I got my job, first thing I did was to borrow money and renovate my mother’s house. And I remember from those days, I really liked design, I liked adjustment. “So I changed that government housing that we lived in and was able to convert it smartly. So I think design and construction is something that I like,”said Mohamed Alabbar, who sits atop Emmar Properties as well as Eagle Hills, both real estate companies with huge stakes in the property market in the UAE and 14 other countries. We were in the middle of an interview session on the 13th floor of the 63-storey Address Downtown hotel, which is one of the most remarkable structures in the world. “We” in this case refers to Alabbar, some members of his staff and a team of media personnel from Nigeria who were in Dubai on a tour of Downtown Dubai in particular, and other Emmar developments.
Alabbar and his property companies are spreading their tentacles to Nigeria; the Centenary City development in Abuja is one of their projects.
Looking out through the huge glass windows, the BurjKhalifa is unmistakeable in all its majesty. It is almost impossible to relate Alabbar’s humble beginnings to this iconic building that is a representation of 21st century human achievement. All questions prior to this moment about the man reveal that his staff hold him in the highest esteem, in awe even. When he walked into the Cigar Lounge – he was dressed in a white thawb (jalabiyyah) – the room became silent.
Alabbar smiled. He looked way younger than his 58 years. He broke the silence. “You want me to tell you a little about how we do our business?”Everyone nodded in unison, a few muttered “yes”.
“We started our development business about 18 years ago,” he started. “I spent seven years of my life in Singapore then I came back to Dubai in 1992. I headed something called Economic Development Board for about seven, eight years. I was collecting taxes, I was doing business relations,I hired a lot of young people, there w ere about 200 of us. We really did an incredible job. We had so much fun. Anyway after seven, eight years, I decided I could see progress in the city and definitely, infrastructure is important.”
“I Had No Money” At the moment, Emmarcontrols large chunks of the property business in Dubai. “Maybe the biggest player. Maybe between 20 – 25 per cent,” he revealed. But according to him, he started with no money.
“I wanted to start a company but I had no money so that was a challenge. But I did a business plan and people believed in my credibility and what work I’ve done with the government. So investors put in like 50 million dollars.
“The rules allowed me to go public at that time and I raised another 50 million from the market. I never thought it was going to be this big. But I like development, I like design, I really like to do things well, I like reputation, I believe that I’m in a business where if somebody wanted to buy a home from me, most probably it’s the most important decision in their life. That’s the biggest chunk of investment for anyone.
“If you’re buying a house for business or you’re buying it to live in, that’s the most incredible decision in your life. And you want to give this money to somebody you trust. So our philosophy here – me and my staff – is if we’re making five dollars profit, why not do a good job?? Right? We’re making profit. Let’s do a fabulous job.”
Alabbar is renowned for his attention to detail and his quest for perfection. It explains why some of his staff nicknamed him “The Butcher”. As one of them explained earlier, “you go to him with a plan that you think is amazing and he shoots it down saying ‘it’s one centimetre too long’ or something like that.”
Alabbar confirmed this desire to do things well even if it costs more as he continued: “… And then, maybe instead of making four dollars, we end up making three dollars because we want to do things well. But we end up making five. People paid us more than we thought in our financial feasibility because people wanted to trust someone. We started that way, we continued, we got lucky.”
Alabbar is a very bold man who is proud of his heritage. “We like to do large size; two million square metres, four million square metres… we like to do things big and this (Downtown Dubai) is the third large project that we have done. Emirate Hills was huge, then we’ve done Dubai Marina which is six million square metres and then we finished that and we came to town. This is about three million square metres as a site.
“But all in all, we think of human life, we see ourselves and all of you travelling the world – Paris, London, New York, Kuala Lumpur – and we say wow! What beautiful places these are.
“And I got quite annoyed and thought, ‘these are good but can we be just as good? We need to be proud of ourselves. Okay, we’re going to make some money while we’re doing business but can we do things right?’ So to do a site like this where this year (2014), we have 80 million visitors is unbelievable. I never knew I would see this in my lifetime,” he said. Eighty million is a large number and there were a few quizzical looks around the table. He sensed this.
“And we have 1500 sensors so I can tell you exactly how many visitors we have everyday,” he disclosed. “But we control it. We manage the roads, we manage the flowers, we clean the bathrooms, we clean the parking, we put our security in; everything totally managed by us. And we’re so lucky to be trusted, to do this. In my life that I’m able to build a monument like this… a large mall, whatever I do in Cairo, in Istanbul… It is such a gift that we should be able to do a good job.
“We’re a young country and we need to do so much more, and the same thing in Nigeria. So much we can do. And if we’re making two dollars, why not do a good job? Isn’t that nice? To have a good brand, to have a good name. That is very critical for us and I’m sure there are a lot of young people and older people in Nigeria that are doing the same thing; they do good quality work, in any field. Technology, banking, real estate… We are quite passionate about what we do,” he said. Seeing the Upside
“If you look at Nigeria and Africa, so much can be done. People complain about power supply issue and all that, and I know it’s a problem but I’m sure we will progress. We used to have power cuts in this city too. These are growing pains but we were very lucky because we’re only 1.5 million people and Nigeria is close to what? 170 million? That’s different scale. And I’m sure it’s going to be fixed. I wish it could be fixed as soon as possible. We can’t wait too long because we’re all connected to technology, we’re connected to TV and we see how other people live everywhere, we just want to live as good. Right? Isn’t that what we want?”
Alabbar is persuasive and it is easy to see how he can convey his vision to people and why they believe in him. “I’m in the business I hope, of providing reasonable, comfortable, quality lives,” he explained.”The house you live in, how the road is made, how the road is maintained, how the playground for the kids is being put,how the clinic, the school and the office buildings are designed… that’s the business we’re in.
“And that also adds to economic progress. This site alone contributes four per cent of Dubai’s GDP. And we are a big tourist attraction by the way.”
Plan Well, Get Lucky Alabbar confessed that he never imagined he would become so successful. “Did this just happen by planning well? Yes we planned well. But we never knew it was going to work so well.”
One of his strategies has been to learn from other cities that have embarked on the kind of developments he envisions and not only replicate but improve on them. According to him, his company drew inspiration from Vegas, because there’s fabulous stuff in Vegas, Paris, London and New York.
“For example, we have a Mohammed Bin Rashid Boulevard here. We brought in the people that worked on the Champs Elysees and said ‘let’s talk about design. More importantly, let’s talk about mistakes. What were the mistakes you have in Champs Elysees?’ They told us they have problems with parking. So they suggested we put the parking first, and put the boulevard on top. So we built 5,000 car parks and then we put the boulevard on it. Today you drive on our boulevard, but there’s a kingdom underground.”
Alabbar wasn’t done addressing mistakes. He asked about more. “‘Well, it’s very embarrassing but toilets are a problem at the Champs Elysees. There are all these tourists but there are no toilets.’
“So we have 55 toiletsunderground. And they’re clean, we make sure they’re clean. Of course they wanted security and technology and we put that in. But for us also as Middle Eastern, I can’t put a mosque in this congested area. So in our car parks, we have five mosques for men, five mosques for women. With full facilities.
“Are we going to make money from that parking? No we’re not. But if we want to succeed, if we want to get a good environment in, we have to provide these services. But we make money from the real estate.”
Alabbar continued on how he learnt on the job. “We installed our fountain for 180 million dollars. Do you think I can charge people for it? No I can’t. But we discovered that every buildingwe built with a view of the fountain, we make more money from the building than from the fountain probably ten times or more. I never knew that.”
Yet he is humble enough to admit to shortfalls.”At the same time we made mistakes. Because it is this vast, this cost about 15 billion dollars here. But we learned from the mistakes, some of them we’ve adjusted, some we couldn’t adjust. We could have designed our roads in a better way. But today, we have to take this experience and repeat it.
“Countries all around us, they all need to build a very smart and sustainable hub. And that’s what is happening in Nigeria and I hope we do one in Abuja and we do one in Lagos. These are great cities in the world, not only in Africa.”
The Idea behind the BurjKhalifa
Alabbar was asked to explain the concept behind the BurjKhalifa. “The design was totally engineering-driven because the design of a tall building has to take into account wind speed. So the design breaks for wind purposes because if you don’t break the building, typically the wind grabs the building from the bottom and just swings around it. It’s quite dangerous for the structure. But if you have these breaks, then the wind gets confused.
“But I also think it’s a good-looking building in my humble view. The idea behind it is that we love our city, we want to put a landmark in the city but I think it was also important to put a landmark for this development because it generates value for everything around it. These are landmarks that add value to real estate as well. And we’re proud of our city and we want to be recognized worldwide.”
Personal Style Alabbarexplained how he operates. “In my job, I follow up design in detail, I follow up marketing and I have a strong team which manages the finance and makes sure we do things right and make sure there’s money in the bank and we don’t borrow too much.” This is interesting considering his educational background is in finance. How did design come in? “My grandfather is a builder. My uncles are all mathematicians, they’re really into design. They’re quite good. Maybe it’s some kind of a DNA thing. Possibly. A lot of times, DNA affects how we behave. ”
The Initial Vision Singapore was very influential in Alabbar’s choice of business. “When I was in Dubai, I sat on a board in Singapore. I flew back and forth and in Singapore, you open the newspapers and the biggest news is always about Mr XYZ, owner of a real estate company. Property was always big news.
“But at the same time when I came to Dubai, I found out that one building was by Mr Abdullah, another by Mr John and then in between you had the sand, maybe road, maybe not… and I thought, it would be nice to do things right. Plan the roads, landscape the roads, make sure the buildings are in harmony design-wise. It would be nice for somebody to start a development company with a comprehensive plan,’ I said.I got lucky that the market in Dubai was moving forward. And that’s pure luck.
“When I started, I never knew it was going to get this big. But there are two elements. One, because we became public, and I live in a society where if I take your money to invest, it is unacceptable if I don’t make money for you.Ethically, where I come from, the society I live in, they expect success. So being public, taking people’s money, it was unbelievable pressure. Till this moment.
“Number two, say today we got to the size we are – we are close to a 35 billion dollar company, we’re profitable. Do we really need to run around to do projects in Morocco, in Nigeria? We don’t have to. But we believe we can enrich the world and enrich ourselves. And these are opportunities. It’s just common sense for me. But on top of that, I’m really very passionate about designing new neighbourhoods.
“I don’t know how I did this but when I started, my first project was actually 500 homes. It was huge. The site was about 400 hectares. Why I started that way and why I like big sites? Because I like to control the environment and control what happens there. ” Maybe it was the word “control” but suddenly, someone asked if he had political ambitions. “No, no,” he repeated.”Being a public company is enough pain for me.”
Guiding Principles Alabbar clarified the principles behind his business. “You have to have an open mind, you look at world, look at the market you are in, and always look out for opportunities. Surround yourself with good people, make sure you have good business principles, and one of them is that we want people to trust us.
“We want our bankers to trust us, we want our shareholders to trust us, we want our customers more importantly to trust us, I hope our staff trust us. And, you need to have discipline. Without discipline, you cannot do a thing.”
Hollywood Lifestyle Apart from Singapore, did any other country or culture shape the vision of his development companies? “Personally, I think the US had a big effect on my master-planning and thinking and lifestyle we create. So I use a lot of American architects and American master-planners in what we do. So I would say America has more influence over how we design and the lifestyle we create. Maybe Hollywood is affecting us,” he laughed.
A Thought for the Not-so-rich Not everyone can afford the Hollywood lifestyle though and he is very aware of that. “You know, four years ago, I almost left this business and almost started a social housing development company. And I saw a friend of mine in California – a very wise man – and I told him what I planned to do. I did a lot of investigation on social housing in Mexico. They are the most successful country in world in social housing.
“My friend advised me and said,’Mohamed if you go into social housing, you will fail miserably because you will have no discipline. You won’t have discipline to manage costs well. Program well. Deliver the house to specific quality well. If all your staff understand it’s charity, psychologically, it has an effect.’ So he advised me to build it cheap but always put a profit. ‘Whatever profit you make, take it and build homes for people who cannot buy any homes, and give it to them free of charge.'”
Alabbar took his wise friend’s advice. “Right now, what I do is make sure our companies have social programs. I build every once in a while, villages of forty to fifty homes in different neighbourhoods, and I work with mayors of little towns and they distribute them to the people who are homeless.
“I do some solar power projects that I give to villages that don’t have power that way. And in Dubai very soon, we’ll be doing big work on the rehabilitation of our creek. It’s a big project. We are putting a lot of money to clean up our creek. It’s clean but we want to take it up. So in every society that I do business, we always look at the social side.”
Coming to Nigeria
Alabbar’s development companies have a presence in 14 countries. He spoke on why Nigeria is another frontier and the value he hopes to bring to the country. “If you want to do business worldwide, you have to look at sizable economies and sizable populations. Nigeria is one of the largest economies in the world and the largest in Africa. It has the size. It’s growing so you’ve got all the right principles. Will it be easy for me? Of course it’s a foreign country but I do business in other countries, it doesn’t bother me.”
He continued; “What will the development add? I hope it adds to the infrastructure of the country, I hope it adds to the confidence in the country, I hope we make reasonable return for our shareholders and I hope we meet expectations as we build the development.” Considering what he has achieved so far, it would take a brave man to bet against Alabbar bringing this dream to reality.