Jordan's Abdali considering an IPO as it helps put kingdom on a path to stronger growth

Company chairman Amer Al-Fayez says development has helped create 15,000 jobs in the country

A picture of The Abdali area, the new downtown of Amman, the capital's largest mixed-use urban development ever constructed. Photo: Abdali
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Jordan's Abdali Investment and Development company, the kingdom's largest real estate development project, is considering an initial public offering in the future, its chairman said.

Abdali is a 50-50 joint venture between Jordan’s largest property investment firm, state-owned Mawared, and Horizon International for Development, a real estate holding company owned by Bahaa Hariri, the eldest son of the late former Lebanese Prime Minister Rafic Hariri.

"We are definitely entertaining that idea, maybe in the next few years," Amer Al-Fayez told The National in an interview from Amman.

"It’s a long process ... when you want to do an IPO ... we want to build a solid basis for it. Once we do this, it is definitely on our agenda. This is the plan for the future and … this is the way to grow much bigger than where we are today."

The size of the potential listing depends on the performance of the business, he said.

"This goes back to how much we are selling a square metre in Abdali and what profits or income the other subsidiary companies that we have are generating as well," said the 55-year-old, who previously served as head of royal protocol at the Royal Hashemite Court under King Abdullah.

"We never discussed how much exactly we’re going to release out of the company, but my idea is you can go 25 to 30 per cent IPO … to start with. Definitely the target is to generate more capital and to invest in Abdali as well."

Abdali, dubbed the new downtown area of Amman, is a mixed-used project. It consists of hotels like the W, Rotana, serviced hotel apartments, as well as office towers that serve as headquarters for banks, Amazon and Orange in addition to a state-of-the-art hospital and high-end retail outlets.

The company is "a good example" of public private partnership and the $5 billion Abdali project, located in the heart of Amman, continues to garner interest from businesses, Mr Al-Fayez said.

After enduring the economic slowdown caused by the Covid-19 pandemic, the environment is improving.

"It has been a very long journey in Abdali, it was bumpy in the last 15 years and now I think we are on the right track," Mr Al-Fayez said.

"In Abdali we are pleasantly surprised how things are progressing and how good things are. Footfall is rising by the day, businesses are growing, compared to the pandemic we are presently surprised by the amount of tourists coming."

Tourism, which accounts for about 14.6 per cent of Jordan’s gross domestic product and employs approximately 57,000 people, is on the rebound.

The kingdom recorded a 41.3 per cent increase in revenue from tourism in the first eight months of the year compared to the same period in 2022, reaping about $5.15 billion, according to the latest data from the Central Bank of Jordan.

More than 4.5 million tourists visited the kingdom in the period to the end of August, about 42 per cent more from the same period in 2022.

Ryanair now has 25 routes connecting Jordan with 12 European cities, and other carriers like easyJet and Wizz Air are also helping spur traffic to the kingdom.

"I always say Abdali is the beating heart of Amman. It is giving Amman a modern, vibrant look. It is adding a lot to the economy," Mr Al-Fayez said.

"It was a challenge for me when I started here. I learnt a lot … [it felt like] I took a Masters in business and economics. I have a very good team around me, I didn’t do anything by myself. I did a lot of changes in Abdali hopefully for the better. To me success is about being good at managing people, it is not [just] knowledge about the economy or how companies work."

Mr Al-Fayez says Abdali has created about 15,000 jobs in the kingdom and is helping put Jordan on a path to stronger growth but believes the government needs to do more to boost the economy.

Jordan's economy is expected to grow by 2.7 per cent in 2023, continuing a post-pandemic recovery, based on International Monetary Fund estimates. Fitch Solutions raised its 2023 forecast for Jordan’s real GDP to 2.8 per cent from 2.6 per cent on the expectation of stronger private consumption and export growth.

"The government needs to do more to attract investment and the ease of doing business in Jordan is still challenging but it is work in progress," Mr Al-Fayez said.

He said the economy's growth target should be 5 to 6 per cent "at least".

Abdali will be launching phase two of the company's expansion within the coming three months by opening the tendering process for the development of the infrastructure, he said.

The second phase will add another 1.2 million square metres to the size of the development, boosting the built area to 3.1 million square metres.

Abdali, which doesn't currently invest itself in the project but sells net development rights and land, aims to have an anchor project like a convention and exhibition centre for the second phase.

Mr Al-Fayez wants to capitalise on Jordan's human capital and IT talent and attract future tenants from the technology sector, lure companies from the UAE, wider Gulf region as well as Asia, and position Abdali as potentially being a hub for an arbitration centre in Jordan.

"I think there is a lot of potential for growth," he said.

Updated: September 25, 2023, 9:15 AM