Jonathan Worsley, chairman of Bench Events recently interviewed Ivanka Trump, executive vice president of development and acquisitions at The Trump Organisation, ahead of her appearance at the upcoming 2015 Arabian Hotels & Investment Conference in Dubai.
Take a look at her thoughts here.
Jonathan Worsley: Where geographically are you looking at investing in the Middle East? And why those markets?
Ivanka Trump: We are looking very closely at opportunities in the UAE, Qatar, Saudi Arabia and Oman.
The fundamentals that drive real estate and hospitality growth are in place in these markets - strong GDP growth, a young and fast-growing population with aspiration to own and experience luxury products and a well regulated environment with strong consumer protection.
Another important consideration is brand recognition.
Trump is one of the world’s best recognised brands, synonymous with luxury lifestyle and excellence in all aspects.
We don’t need to introduce our brand to consumers in these markets because they already have an understanding of the Trump brand and what we are able to deliver.
Finally, for our development partners it is important that we are able to add value through demonstrable premiums on real estate prices or as a luxury hotel operator to generate higher ADR’s, sustainable occupancies and market leading ROI’s.
JW: In terms of real estate segments - residential, tourism and leisure, commercial, etc. - which offer the best returns in the region?
IT: Dubai leads the way in both real estate and hospitality demand and therefore continues to offer the highest returns.
Jeddah meanwhile with its unbeatable location as the gateway to the Holy Cities and the economic capital of the largest economy in the Middle East delivers consistently strong hotel performance.
With the World Cup bid, Doha is also gearing up to be a tourism powerhouse.
We also believe markets like Egypt will become increasingly relevant as there is an expected return to stability coupled with strong underlying country fundamentals.
There are some tremendous opportunities within the region across multiple sectors, and with the right development mix in a strong location and a brand such as ours, one can truly deliver and exceed investor expectations.
JW: How do the anticipated returns on investments in this region compare to similar investment markets elsewhere in the world? Is this still a hot market?
IT: The regional markets across the MENA region have shown tremendous volatility; as a result market performance has been relatively unpredictable.
Most of the region’s real estate markets are also very young, having been through relatively fewer economic cycles compared to more mature markets.
This volatility means there is great potential on the upside and our approach has been incredibly strategic.
We are confident that our product will resonate with consumers and see how positively the market responds to the Trump brand.
JW: As well as domestic investment in real estate, an increasing number of Gulf investors are looking to the wider region – Egypt, Africa, and Turkey. How do you view the wider EMEA region? Where do you see the most exiting investment opportunities in the region?
IT: Africa certainly remains very interesting with Morocco, Egypt, South Africa and Nigeria among some key markets.
We already have a very successful mixed-use development in Istanbul and are in active discussions for a luxury hotel in the city.
We think it’s a fantastic market, strategically located at the cross-roads of East and the West.
Marrakech is a strong golfing destination with deep-rooted culture and history, Trump currently owns and operates 18 world-class golf courses globally and as a result there is great interest in our brand for a golf resort with ultra-luxury residences.
The Trump brand also resonates well in South Africa and Nigeria, where there is a strong consumer connection with the brand’s attributes – personal success, the glamour quotient, and the exclusivity of owning something associated with a brand like Trump.
JW: This part of the world often gets very negative coverage from outside the region, what do you see as the risks and challenges from investing in this region?
IT: Again it varies by market but it’s the geo-political risk that is the biggest challenge.
There are some fundamentals that don’t change regardless of geography.
Choosing the right partner is an important element in mitigating majority of the development risks and challenges in any region.
JW: If at all, how is your view of the region affected by the recent fall in oil prices?
IT: Majority of the oil producing nations in the region have recognized that over-reliance on an oil producing economy is not sustainable in the long term, and we have already seen examples of successful diversification from countries like Abu Dhabi and Qatar – into real estate, sports events, tourism, and beyond.
This bodes well for Trump as these countries look for brands that can increase visitor footfall and drive new travellers seeking unique experiences in the region.
The Trump brand has an incredibly loyal brand following across the globe and we are pleased to be considered a key contender in this highly competitive market.
JW: What is the key to succeeding in this region?
IT: It’s understanding that just like Europe, the Middle East is one region, but different countries with varying cultures, demographics and economic success factors.
What might work in Muscat might not be relevant in Riyadh.
A real understanding of what works for each country, but also having the ‘boots on the ground’ is crucial.
We have heavily invested in our regional office in Dubai to back this philosophy and today we have a strong development and sales presence across the region.
Local presence that truly supports our development partner needs.
Ivanka Trump will join the Arabian Hotel Investment Conference, which takes place from May 5th-7th at the Madinat Jumeirah Dubai, to discuss the future of luxury in the sector and the next generation of luxury traveller.
Reserved your place at the event by visiting the official website.