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Building the future: Beirut Digital District

Many cities want to venture in the footsteps of Silicon Valley, California and reap the economic benefits of hosting some of the world’s largest tech companies. However, for a city to become a tech hub, it should attract and retain talent, enable companies to set up shop at a low cost and provide the necessary infrastructure for firms to run day‐to‐day operations.While Beirut has a large pool of talented entrepreneurs and university graduates, the Lebanese capital lacks the proper infrastructure to host startups. However, this is about to change thanks to the steady efforts of Zen Real Estate.Zen Real Estate is transforming the Bashoura neighborhood in downtown Beirut into a vibrant and green community poised to become the next Middle East technology hub. “Our benchmark is the international transformation of neighborhoods such as the meatpacking district in New York, 22@ in Barcelona, and the Silicon Roundabout in the UK into magnets that attract creative people who want to be at the center of what’s happening,” says ZRE General Manger Mouhamad Rabah. 

ZRE’s project entitled Beirut Digital District (BDD) aims to transform the Bashoura area into a center of attraction for creative minds through incubators and accelerator parks designed to host startup companies as well as established firms. “We believe that a creative knowledge‐based economy is the future, and Lebanon can be the hub for tech productivity in the Middle East and complement areas in the gulf such as Dubai,” Rabah tells Ekaruna. ZRE’s master plan for BDD is a 15‐year development project divided into four phases. ZRE’s vision is to create a community with access to advanced IT infrastructure and state‐of‐the‐art services, enabling tech companies based in Beirut to compete globally, says Rabah. “This, we believe, would differentiate BDD from simply being a real estate project. Instead, BDD would offer a technological platform where real estate contributes to the improvement of the lives and experience of users,” says Rabah.  

‐ Phase A (2012‐16), consists mainly of refurbishing old buildings. It will include seven buildings spanning over a total area of 17,500 square meters. These buildings will comprise office space catering to more than 50 companies and 1500 employees. Fiber optics Internet and Wi‐fi connections runs throughout the buildings, which also include a gym, a canteen, and a garden as well as large meeting and conference rooms.

‐ Phase B (2016‐2019) will be divided into two stages and will initially feature the construction of a building comprising 17,500 square meters of office space in addition to communal spaces, an auditorium and an exhibition hall. The second part of phase B will feature the construction of a second building in addition to furnished and residential apartments. 

‐ Phase C and D (2020‐2027) will feature the expansion of BDD into 140,000 square meters. Half of the additional space would be dedicated to offices and the other half will be split equally between furnished and residential apartments in addition to one or two 3‐4 star hotels. The last phase will include the renovation or demolition and reconstruction of buildings from phase A to expand green spaces. “We’re renovating cultural and historical buildings – even the ones that are not listed as cultural‐‐because we believe they are priceless and will blend with our future and make a great cosmopolitan environment,” Rabah said. Rabah adds that ZRE is trying to offer companies value beyond real estate in a prime location. “We look at companies in our community as partners and we would like them to grow with us. Therefore we want to ensure that real estate does not become a burden on them, and that’s why we give them long‐term visibility on their rental rates, and on their ability to move from one office to another,” Rabah says. ZRE also offers companies the choice to assist them with all governmental bureaucratic transactions that are time consuming, allowing their tenants to solely focus on their core business, says Rabah. They also offer services such as accounting and auditing at preferred rates. “ZRE’s relationship with its tenants transcends real estate and includes added value services from facility management to state of the art IT infrastructure and shared facilities which positively contribute to productivity,” adds Rabah. At BDD, management has given communal spaces a priority to provide companies a platform to exchange ideas and feed off of each other’s energy. Among the companies residing at BDD is Nymgo, a company that provides mobile communication and financial services for immigrants around the world. Ayman Chalhoub, Nymgo’s Chief Marketing Officer, tells EKARUNA “the fact that most of the tech companies are located here, has allowed a sense of closeness and cooperation to develop among them. The energy and ideas from young tech professionals create a hopeful and optimistic atmosphere very different from the rest of the country.”  For ZRE, BDD is not only poised to become the next MENA tech hub but also an environment‐friendly and sustainable community. “We are dedicated and committed to creating a LEED neighborhood,” Rabah said, adding that, “the future lies in in green energy, and when cities around the world are moving in the direction of sustainable renewable energy even cheap oil may become almost obsolete.” Ultimately, ZRE aims to transform BDD into a talent pool in the region, says Rabah.“I personally believe that we would complement rather than compete with Dubai. In terms of infrastructure, they have taken a huge leap forward and attracted so many international companies where they can always be a platform for sales in the region. However, Lebanon can be the production facility because we have the workforce that’s coming from the education system that Lebanon enjoys,” Rabah said. This vision of Beirut can be accomplished in the short to medium term and enables  Lebanon to eventually attract multinational companies, Rabah believes.“Lebanon will be able to attract multinationals and compete at a regional level once we restore political stability and build an independent legal system,” Rabah explains. Rabah maintains that the Lebanese government should focus on supporting and developing its knowledge‐based economy to complement an already vibrant service‐based economy. “We hope the political parties would work in that direction rather than focus on how oil could act as the next economic savior,” Rabah says. With phase A nearly completed, BDD is now home to 50 companies. 95% of these companies are local including 30 start‐ups and small‐sized companies. “The three main features we enjoy at BDD are high end offices with uncompromising maintenance, advanced infrastructure such as electricity, high‐speed internet, and heating to mention a few, and the great location in downtown; This is really what start‐ups need to focus on their core business,” Chalhoub said.  ZRE’s vision has received wider national traction as news of several, smaller‐size digital districts, are being developed in other regions of Lebanon. Rabah has some sobering but valuable words of advice to developers aiming to invest in the relatively untapped technology‐based economy in Lebanon. “Unfortunately I have to say it... It has become a golden rule... to always assume that anything provided by the government is an added value.” Rabah also warns investors against venturing into new projects unless they are financially capable of withstanding changes in the market conditions that could prove detrimental. “We should see more collaboration in Lebanon between parties in the same ecosystem. Don’t compete locally, collaborate locally and compete regionally or internationally,” he says.