ASEZA celebrated its fifth birthday last month, boasting $700 million in actual investments and $2.1 billion in committed investments so far. The success in committing this volume of investment has spurred the Authority to revise its targets ambitiously. Instead of attracting $6 billion by 2020, as called for by the original plan, ASEZA has pulled the timeline back to 2010.

The event, which took place at the Hotel InterContinental Aqaba, also marked the launch of ASEZA's latest mission to hit the road and seek out new investors. Officials and executives took to the stage to congratulate the zone's commissioners, led by Chief Commissioner Nader Dahabi, and pledge their continued support for investment projects in Aqaba and its environs.

Mega-investor Sabih Masri told Jordan Business that he was delighted with the "stellar success" observed in Aqaba, especially since he and the Talhouni family were among the first large investors to enter the zone with their Zara HoldingsZara Holdings consortium, building the Movenpick Aqaba Spa and Resort.

Mr. Masri applauded the rise of new hotels and resorts in Aqaba, stating his belief that providing different options will attract more people to the city in the long term, creating a win-win situation for everyone. He shrugged off concerns that Aqaba would suffer from last August's rocket attack on an American naval vessel and the bombings that struck three hotels in Amman.

"People have short memories," said Mr. Masri with a smile. "Even if things are bad for a few months, we are not worried in the long term. Those who live in the past get covered by dust; I am an optimist by nature and I never look back."

To emphasize this point, Mr. Masri noted that Zara Investments was involved in most of the new projects breaking ground in Aqaba, including Tala Bay and the Tala Hills project at Yamaniya.

Nasser Al-Khaldi, CEO of Jordan Projects for Tourism Development (JPTD)Jordan Projects for Tourism Development (JPTD), is upbeat about Aqaba, and he should be. Tala Bay, JPTD's signature project, opened in late 2005 with 100% occupancy in the first phase of the project, and almost 80% of the second phase is already sold out. Construction on Tala Bay's three hotels is moving forward, and the company had its first profitable year in 2005.

"Out of our investment totaling almost $500 million, we have around $150 million on the ground today," said Mr. Al-Khaldi. "I think the excitement about Aqaba overall has been very beneficial to us, and we have been able to make a good impression on customers seeking ownership in Tala Bay as well as investors coming in with new funding."

During the proceedings of the ASEZA celebration, several agreements were announced and signed, including a deal between the Aqaba Development Corporation (ADC)Aqaba Development Corporation (ADC) and the International Investment Arabian Group to develop a new residential project on 2,850 square meters of land in the north of the ASEZ.

Another agreement, signed between Saraya Aqaba and a joint venture of ADCADC and the Kuwaiti Jordanian Holding Company (KJHCO), enlists the provision of infrastructure services for Saraya Aqaba, including electrical wiring, natural gas, desalination, air conditioning, and wastewater treatment.

The building blocks
With Saraya Aqaba and recently Ayla OasisAyla Oasis officially launched, and the first phase of Tala Bay now operational, Aqaba is opening up the throttle and advancing ahead at full speed.

Saraya Aqaba's General Manager, Dr. Khalid Wazani, said in an interview with Jordan Business that the $600 million project was a turning point for Aqaba that will change it along the lines envisaged by the new Aqaba master plan.

"The Aqaba project will upgrade the living standards for the residents of Aqaba and open a highly competitive market for the provision of unique services to residents and visitors," said Dr. Wazani.

Last year, twice as many tourists visited Aqaba compared to 2000, and over 20,000 jobs have been created in the Zone over the past five years.

But for those expecting to go to Aqaba today and see something that looks vaguely like the beginnings of the Dubai frenzy, stop right now. Aqaba will be something completely different from Dubai, and that's the way ASEZA wants Aqaba to remain: a unique destination that is developed enough to attract world-class tourism while maintaining a comfortable resort atmosphere.

What's most visible on the ground today in Aqaba is the infrastructure, according to Salih Kelani, ASEZA's commissioner for investment. The road network has been revamped entirely, with wide streets, even pavements, clean sidewalks and proper lighting throughout. Even the speed bumps in the downtown district manage to be gentle on vehicles.

The Hijaz Railway provides access to Aqaba by train, with upcoming plans to extend it and separate lines for hauling phosphates. ASEZA has also just completed a tourist railway connecting Aqaba with Wadi Rum, which will allow for convenient daytime excursions.

On the telecommunications front, Aqaba has full satellite coverage and mobile telephony services, plus high-speed Internet connectivity through the fiber-optic Link Around the Globe (FLAG), which links 75% of the world's population using 100,000 kilometers of submarine cable.

Aqaba's electrical grid has been developed over the past few years as well, with a 650-megawatt thermal power station providing a reliable supply of electricity to the entire zone as well as the rest of Jordan. The use of natural gas through a 278-kilometer pipeline from Al-Arish in Egypt is helping meet industrial and domestic demand in the ASEZ, and natural gas is beginning to replace expensive oil derivatives in electricity generation, with plans to begin using natural gas to fuel cars and trucks.

The nearby Disi aquifer supplies approximately 17.5 million cubic meters of clean water to Aqaba each year, and the government is already looking to upgrade its wells in addition to seeking out new sources that will cover Aqaba's needs for the next two decades. Desalination is also considered a valuable opportunity for investment.

Omar Al Manha, director of the King Hussein International Airport in Aqaba, told Jordan Business that the current airport was completely equipped to serve the ASEZ around the clock, with a capacity of 75-100 flights daily. However, with the significant surge in air cargo over the past couple of years, a separate cargo terminal has been added to the Aqaba airport's facilities. The airport was recently renovated, receiving a face-lift last summer to reflect a better image of Aqaba. Plans have also been set to expand the airport's runways and passenger facilities within the coming five years, as the number of passengers coming to Aqaba rises. The airport's location means that even an entirely new structure in the far future is logistically feasible as well. Now operating under an open skies policy, the King Hussein International Airport is increasing the number of destinations on offer, with flights available between Aqaba and Dubai, Abu Dhabi, Manama, Alexandria, Asiout and of course, Amman. Future destinations will include cities like Kuwait and London.

Getting on the bandwagon
Besides the three major landmark projects on the ground in Aqaba today, there are several other projects that are getting read to join the fray and participate in transforming the port city. Speaking of ports, the $1 billion relocation of Aqaba's main port will begin in the fourth quarter of this year, freeing up almost 1,700 square meters of real estate for investment, according to Nasim Al-Ahmad, vice president of transportation and infrastructure at ADCADC.

For starters, work is just beginning on the Red Sea Resort, a luxury project undertaken by Al-Qabas Real Estate Development, which has now been grouped under the umbrella of TaameerTaameer, the latest large-scale developer to appear on the Jordanian market with the largest local IPO to date of JD53 million out of its full capital of JD212 million.

The Tala Hills project was also showcased at the ASEZA fifth anniversary celebration. The resort, to be built on 40,000 square meters at Yamaniya Hills south of Aqaba, features chalets, villas, a recreational area, and a hotel. The project will exploit the topography of the area to provide a view of the Red Sea that will attract a sizable number of vacationers.

The surprise appearance at the Aqaba commemoration was newcomer Amaar Properties (no relation to Dubai's EMAAR), which unveiled the extravagant Palm Hills residential project in Aqaba. However, almost no details about the project were available, with the exception of an artist's rendition.

Beyond the flurry of real estate projects targeting tourists and residential customers, business and industry received attention in a separate presentation. The National Real Estate Company, for example, presented its plan for the new industrial area in Aqaba. Divided into two areas, the northern section of 540,000 square meters has almost 80% of its infrastructure now complete, with 21.1% of the area dedicated to office buildings, 66% for warehousing, and the remainder for cold storage. The infrastructure of the southern section, which is just over 1 million square meters in area, is 40% complete, and will be used for light industries on 6.4% of the area, with 42.4% for warehouses, 26.4% for storage space, and 6.74% for cold storage.

Next, Parsons Brinckerhoff International (PBI) Aqaba presented the new Aqaba International Industrial Estate (AIIE)Aqaba International Industrial Estate (AIIE), which is managed and privately developed by PBI Aqaba with funding from USAID. AIIE is owned by the Industrial Estates Association, and includes a $75 million investment in infrastructure and buildings, with $200 million from investors directed towards different projects. The Estate will feature light industries including metals, construction materials, plastics, electronics and appliances, foodstuffs, paper and packaging, and ceramics, as well as logistics services. The project will capitalize on the extensive external economies of scale that will become available in Aqaba.

Talal Abu Ghazaleh (TAG) GroupTalal Abu Ghazaleh (TAG) Group, better known as a heavyweight in accounting, intellectual property, consulting and legal services, made a strong showing at the anniversary event with a presentation of the proposed Aqaba Smart Business Village. With many businesses in Aqaba being forced to work out of hotels and apartments, the ten office buildings in the Smart Business Village will provide a location with the infrastructure that small- and medium-sized companies need to operate without a significant investment. It will also provide a gateway for foreign companies which are operating in Jordan, with a conference center, an events and meetings center, an exhibition center, and a business center complete with legal, financial, administrative, printing, publishing and translation services.

The evaluation
Ultimately, Aqaba's progress so far is cause for celebration. Things seem to be on the right track, and at least targets are being revised upwards for a change, rather than the defeatist downward trend we see in so many other sectors every time an ambitious project is boldly declared. Observers will be watching closely as the spring season arrives and tourists local and foreign begin to congregate in Aqaba. Security is already very tight to reassure residents and visitors, and there is a strong sense of optimism overall as Saraya Aqaba and Ayla OasisAyla Oasis break ground.

© Jordan Business 2006

 

Community Comments (0) - Comment on this article

The opinions of the authors expressed herein do not necessarily state or reflect Zawya. Read our Comment Policy.

 

 

 

close x

Loading ...

 

close x

Loading ...