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| Hotel Erbil 2009 |
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| Summary of Proposed Investment |
| This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
| Project number | 28566 |
| Company name | Hotel Line Holding sal |
| Country | Iraq |
| Sector | Accommodation & Tourism Services |
| Environmental category | B |
| Department | Global Manufacturing & Services |
| Status | Pending Approval |
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| Date SPI disclosed | October 26, 2009 |
| Projected board date | November 30, 2009 |
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| View Environmental & Social Review Summary (ESRS), click here |
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| Overview |
Sponsor/Cost/Location |
Development Impact |
Contacts |
Attachments |
| Project description |
| Malia Holding s.a.l (the “Sponsor” or “Malia”) a Lebanese conglomerate, has invited IFC to consider financing the development of a green-field hotel in the city of Erbil in northern Iraq (Kurdistan region). Hotel Erbil is a five star business hotel, with 201 rooms, 4 restaurants and supporting services for a total estimated project cost of $40.5 million (the “Project”). Hotel Line for Touristic Investments (the “Company”) is implemented on a 20,000 m2 parcel of land, purchased by the Sponsor through the Board of Investment of the Kurdistan region. The hotel will be operated by the Rotana Hotels Management Corporation (“Rotana” or the “Operator”), a well-known regional hotel management company based in the U.A.E. |
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| Project sponsor and major shareholders of project company |
| The Sponsor is a well diversified Lebanese entity with operations in Lebanon, Syria and Iraq. The Sponsor’s activities include manufacturing, marketing and advertising, distribution of cosmetics, fragrances, pharmaceuticals, personal care and household consumer products, as well as real estate development and construction, electromechanical contracting, system integration, and IT business. In 2008, Malia’s total annual revenue was around $73 million. Malia Holding is owned by Mr. Jacques Sarraf and his brother. Mr. Jacques Sarraf is an ex-president of the Industrialist Association of Lebanon, where he has served two terms. |
| Total project cost and amount and nature of IFC's investment |
| The total project cost is estimated at $40.5 million It is proposed that IFC finance 34.5% of the project cost with an A loan of up to $14 million. |
| Location of project and description of site |
| The hotel is implemented on a 20,000 m2 parcel of land next to the convention center and the main city park of 200,000 m2, 10 km away from the Erbil International Airport. The land was purchased by the Sponsor through the Board of Investment of the Kurdistan region. There has been no expropriation or resettlement of people or economic activities prior to implementation. Moreover, the project site is located in an urban neighborhood and no impact on biodiversity is therefore expected. |
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| Anticipated development impact of the project |
| The Project will foster the development of business infrastructure in Erbil through (i) providing much needed business infrastructure to the employees of development institutions, diplomats, government workers, NGOs, investors, as well as many private companies that are involved in rebuilding Iraq that frequently use Erbil as their home base during their stay and work in other parts of Iraq; (ii) benefiting the municipal city planning by providing infrastructure for business development such as conference rooms and business centers; (iii) creating outsourcing opportunities, (iv) creating more than 300 direct jobs and indirect employment; and (v) extensive hotel training that will be provided by Rotana prior to and during operations, which is expected to enhance the overall service quality standards for the hotel industry in the region |
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| IFC's expected development contribution |
| IFC will play catalytic role in facilitating further private investment into a conflict affected country. IFC’s involvement will have a strong demonstration effect by supporting the private sector foreign investments in the country, with all of the related challenges, and laying critical groundwork for future private investments in hotels and other sectors. Moreover, IFC will provide (i) political coverage, (ii) global sector knowledge and expertise, (iii) appropriate financing conditions for the proposed investment and (iv) guidance to the Company to implement environmental and social best practices. |
| Environmental and social issues - Category B |
The key social and environmental issues associated with the project include: management of Environmental, Social, Health and Safety (ESHS) during construction and operation; working conditions during construction and operation; optimization of resource inputs including water, energy efficiency and waste minimization practices; impacts of construction and operations on communities; and life and fire safety of hotel during operations. The potential adverse effects of the project are limited, site specific and reversible and can be readily mitigated. It is therefore concluded that this is an Environmental Category B project according to IFC’s Environmental and Social Review Procedure.
Please refer to the ESRS for the further information. |
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| For inquiries about the project, contact: |
Mr. Chakib Chehab, General Manager
Tel: +961 1 881212
Fax : +961 1 881313
Email: chakibchehab@maliagroup.com |
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| For inquiries and comments about IFC, contact: |
General IFC Inquiries
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster |
| Local access of project documentation |
Translated versions of the ESRS and ESAP will be made available at the following locations:
In Lebanon:
Malia Holding sal
Zone Amaret Chalhoub,
Sarraf Bldg, Jdeidet-el-Metn,
Lebanon
In Iraq:
Malia Holding
Address: Gulan Street – Rotana Erbil Hotel site
Contact person: Mr. Ibrahim Fayad
Malia CTI Ltd.
Tel: +964750 4546719
Email:ibrahimfayad@maliaholding.com |
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