When Donald Trump called last December for banning Muslims from entering the United States, Hussain Sajwani knew he had to sit tight. The Dubai real estate tycoon was overseeing a project grandiose even by Dubai’s extravagant standards. (This is, after all, the emirate that is home to a massive artificial island in the shape of a palm tree, an indoor skiing mountain and the world’s tallest tower, the Burj Khalifa.) Set on 964 acres, Sajwani’s new Akoya community, about a 15-minute drive from the heart of Dubai, will feature lavish villas, mansions, apartments and its own retail centre. The centrepiece of the gated property is a golf course bearing the Trump name—a name long associated with success in the Arab world.
“We made a deal with Trump as an organisation; they know how to run golf courses,” shrugs Sajwani. “We stay away from politics.”
Sticking to business has been good for the 63-year-old Sajwani. His Damac Properties pulled in revenues of $2.3 billion in 2015, with net margins of more than 50 percent. The company has developed some 15,500 apartments since it was launched in 2002 and has another 40,000 units it plans to build and sell, in the United Arab Emirates (UAE) and as far away as London. Its stellar results have landed Damac’s founder and chairman on Forbes’s list of the World’s Billionaires for the first time this year. His 72 percent stake in the company (which listed its shares on the Dubai Financial Market in January 2015), along with other investments, gives him a net worth of $3.2 billion.
“It’s been a combination of luck and vision,” says Sajwani. “Someone would open the door, and I would run and grab the opportunity.”
Sajwani spotted plenty of opportunity back in 2001 when the Dubai government decided to allow foreigners to own property. He immediately focussed on selling luxury real estate and figuring out what it took to stand out when marketing it. First: A free car! For the past decade, Damac has offered a complimentary Lamborghini or BMW to apartment buyers during the month of January each year—the annual Dubai Shopping Festival. (Damac won’t say how many free cars it has given away.) Other times the company has thrown in some jet skis with a purchase, and last year, for a brief period, buyers of mansions and villas got a free studio apartment as well. To lure potential Chinese buyers, Damac began a two-month promotion last December during which it offered plane tickets, a hotel stay and a visa—essentially a free holiday to Dubai—to prospective residents who reserved a unit.
Luxury brands, including Versace, Fendi and Bugatti, have entered co-branding deals with Damac, raising the appeal for its brand-obsessed clientele.
Bugatti-branded villas planned for the Akoya Oxygen Damac development—a second community on 1,260 acres that will feature another Trump International golf course—include a space next to the glass-walled living room where owners can park and admire their Bugatti sports car.
But Trump’s comments about Muslims did have some ripple effects. According to Reuters, three days after his remarks, Damac Properties removed the Trump name from a stone wall in front of the Akoya project and also replaced images of the New York billionaire and his daughter Ivanka on a billboard nearby; three days later, ‘Trump International Golf Club’ was restored to the wall. But a spokesman for Damac told Forbes that the sign was taken down just “to be cleaned”. For what it’s worth, the pictures of Trump and his daughter were replaced on the billboard with an enormous photo of Marlon Brando as Vito Corleone in The Godfather.
Citizen Trump aside, it’s not the best of times to be selling high-end real estate in Dubai. Low oil prices and weaker currencies have been a drag. The promotion for Chinese customers followed a drop in the value of the Russian ruble and the euro against the US dollar, which weeded out some customers from those regions. Damac Properties admitted in its 2015 earnings announcement, released in early February, that it’s working in a “challenging economic environment”. Sanyalak Manibhandu, an Abu Dhabi-based analyst at NBAD Securities, says property prices in Dubai have softened by about 15 percent since early 2015.
To combat this, Damac has guaranteed buyers a 3 percent annual return on down payments and advance payments (twice what fixed deposits are currently paying, it noted). And it will now guarantee a property’s value for two years, promising to pay the difference if a unit’s price declines between delivery and the end of 2019. Sajwani spins the situation—the current environment “creates opportunities for well-capitalised and experienced companies like ourselves”—in a manner that would make his better-known partner proud.
Hussain Sajwani grew up in Dubai in a middle-class family focussed on selling. His father was a trader with a shop at the local souk, selling watches, Parker pens, shirts and goods imported from China. Sajwani would go to the shop after school most afternoons. His mother went door-to-door selling products to the women in the neighbourhood. Growing up, the dinner-time conversation often revolved around business, he recalls.
Because Sajwani showed promise in school, he received a government scholarship in 1978 to study in the US—making him one of the first wave of students sent to America by the government. After studying English in Atlanta for a few months, he got a degree in industrial engineering and economics from the University of Washington in Seattle. Early on, Sajwani showed a willingness to take risks. While in college he sold time-share apartments in the UAE on the side.
After graduating early in 1981, Sajwani landed a job in the finance department at Abu Dhabi Gas Industries, where he worked on contracts. There he saw just how much money could be made selling services and figured he could do better running his own outfit. Two years later, he resigned and started a catering business in Abu Dhabi, using his earnings from the time-share sales as startup capital.
The catering business flourished. Sajwani landed customers like American construction giant Bechtel and the US military. His company, still operating and now called Global Logistics Services, supplied meals for American armed forces in Kuwait, Afghanistan, Saudi Arabia, Qatar and Bosnia. He recalls sending in ovens and other equipment to make pizzas, at one point serving 2,000 pies a day from a tent in the desert.
Around 1996, with the catering business humming, Sajwani started to develop small hotels in Dubai and purchased property in the emirate’s downtown. Following the decision to allow foreigners to own property in Dubai, he sold some of the property he’d bought and used the funds to buy land in a then-undeveloped neighbourhood called the Marina—an area now packed with futuristic glass skyscrapers.
“Everyone was saying I was mad,” Sajwani recalls, but he knew that growth was coming. Expats from the UK, India and other Arab countries, and many other places, were flocking to the UAE as it became a hub for multinationals. Dubai not only has no income tax or capital gains tax, but it’s also very tolerant culturally—women can wear bikinis at the beach and there’s plenty of nightlife.
In 2002, Sajwani formed Damac Properties to develop residential towers on the Marina land. His strategy was to market the apartments before anything was built—selling “off plan”—and use the buyers’ down payments to help fund construction. He timed it exactly right. The first tower, the 38-storey Marina Terrace, sold out in less than six weeks. Emaar, a real estate developer partly owned by the government, essentially created the Marina by constructing an artificial canal; it also began building residential towers in the district. With each new tower that Damac Properties built, Sajwani helped burnish Dubai’s image as a glittering new destination.
Sajwani’s path to the World’s Billionaires list started the day after Lehman Bros filed for bankruptcy in September 2008. “Everyone said, ‘We’re far away’. I said, ‘Let’s put together an action plan’,” he remembers. He had made down payments on several parcels of real estate. He quickly called the sellers and asked to give the land back, kissing his down payments goodbye. Even with his efforts to stem losses, Damac reportedly had to lay off hundreds of employees amid a sharp downturn in Dubai real estate prices. Several buyers sued Damac Properties as a result of construction delays. A Dubai court ruled in favour of one Canadian buyer and asked Damac to pay him $710,000. Damac also settled confidentially with a German investor who had agreed to buy 22 units in four buildings between 2007 and 2009. “With a company of our size, you are always going to have a few disputes. We try and settle these amicably, but ultimately a few may end up in court,” says a spokesperson for Damac.
Dubai’s reputation took a big hit over the next few years, because there was so much speculation involved in property purchases and plenty of people lost money. Determined to keep real estate speculation at a minimum, the government implemented new laws in 2008 and 2009 requiring that deposits from buyers of off-plan properties be held in escrow; buyers would be entitled to a refund if the developer didn’t hand over the promised property within a certain time frame.
By 2011, while other builders were still cautious from the crisis, Sajwani began preparing for his next Dubai project, something far bigger than he had ever attempted. In October 2012, he struck a deal with the government to buy the land for what eventually became the Akoya. The purchase price for the land: $350 million, payable in installments. The first residents have begun to move in, though construction is expected to continue for four more years.
Though Sajwani’s company projects an image of high-end luxury—its motto is “Live the luxe life”—in reality he’s selling to anyone who can afford to buy: The aspirational middle class as well as the ultrawealthy. Prices for a room in a Dubai hotel start at $120,000, while a seven-bedroom villa on a golf course goes for $10 million.
What sets Damac apart from its competition is its relentless and creative marketing. Sajwani has to compete with two deeper-pocketed developers: Emaar, which created the Burj Khalifa, and Nakheel, the developer of the palm-shaped archipelago off Dubai’s coast. To create buzz for its properties, Damac has saturated Dubai with billboards: 166 of them portray the glories of the luxury lifestyle. “Their marketing is fantastic,” says Craig Salmons, managing director at Dubai real estate agent HMS Homes. “They’re a smaller developer than Nakheel and Emaar—they have to do things better.”
Last year, Damac put on 500 marketing events in 98 cities in China, India, Africa and Europe. “We watch the airlines,” says Niall McLoughlin, an Irishman who’s been working with Damac for nearly a decade and is senior vice president for marketing and communications. “Wherever Emirates Air flies, we go.”
Sajwani has also been investing in real estate abroad. In 2010, he began work on a tower in Beirut with interiors designed by Versace, after four years of luring the Italian design house.
“Mr Sajwani is passionate about Versace and the Versace lifestyle,” Versace CEO Gian Giacomo Ferraris says via email. “He’s a smart businessman who pursues luxury business standards and strongly believes in the added value of the Versace brand.”