Barwa was established in December 2005 and listed on the Doha Securities Market (DSM) in February 2006. Since then, it has established an asset base worth QR24.2bn ($6.6bn) and has property worth QR9.24bn under development.

Structure

Barwa is 45 per cent owned by Qatari Diar, which is in turn owned by the Qatar Investment Authority, the country’s sovereign wealth fund.

The remainder of its shares trade on the DSM. Total shareholder equity is valued at QR4.7bn.

Barwa began as a real estate developer but, like many other state-backed entities, it is diversifying quickly into new sectors.

Some are directly related to real estate, such as construction materials production, facilities management, hotels and resorts.

Other new businesses are less closely tied to the sector, such as banking, finance, communications and investment in new technologies.

In June, Barwa launched five subsidiaries in different sectors, including project management, media, knowledge development and technology investment.

The fifth, Barwa Lusail, is a real estate company that is 30 per cent owned by Barwa and 70 per cent owned by subsidiary Barwa International.

It has been set up to own and manage real estate investments in Qatari Diar’s 35-square-kilometre Lusail development.

In total, the group has 27 subsidiaries, each of which has its own management team but ultimately reports to the five-member board of directors led by Ghanim bin Saad-al Saad. Al-Saad is also chief executive officer of major shareholder Qatari Diar.

Operations

The firm divides its operations into two sectors: real estate and other investments. It then reports its activities in terms of domestic projects and overseas activity.

In Qatar, it focuses on real estate developments, but in international markets it tends to seek investment opportunities in businesses such as hotel chains and serviced apartments.

It also has a strong presence in the financial sector and one of its most recent ventures was setting up a Qatar-based mortgage company with Dubai financial services company Amlak Finance.

A 60 per cent share of Amlak Qatar is owned by Barwa, while the remaining 40 per cent is owned by Amlak Finance. It was licensed by Qatar Central Bank in September, with a start-up capital of QR500m ($137m).

In terms of its domestic real estate developments, Barwa acts as a master developer that sells off plots with basic infrastructure to secondary companies.

It also builds its own properties. Barwa Lusail, for example, will buy and develop plots from master developer Qatari Diar.

In contrast, on the Barwa al-Baraha project, Barwa is overseeing the construction of high-quality accommodation for 53,000 labourers.

The firm says this is part of its social responsibility agenda, which also includes the development of housing for middle-income families.

One of the company’s biggest projects is the QR30bn Barwa al-Khor city development, which aims to provide 24,000 housing units with entertainment facilities for the coastal city of Al-Khor, located 45 kilometres north of Doha.

Earthworks are under way and the detailed design for phase-one infrastructure will be completed in January 2009, for contract tender in March the same year.

Phase two of the infrastructure development will be ready to tender in October or November 2009.

Barwa, in a joint venture with Imtaz Investment, is acting as master developer with the aim of selling plots to secondary companies who will then build the residences.

Progress on Barwa’s domestic projects has been good and has accelerated over the past 12 months, leading to increases in profits.

Profits for the first half of 2008 were QR277m, compared with QR201m for the same period in 2007.

Ambitions

Increasing its international portfolio is a key priority for Barwa and it plans to achieve this through the activities of its overseas subsidiary, Barwa International.

In September, the firm announced it was increasing its original $250m capital investment in luxury hotel venture Shaza Hotels to $675m.

The investment is being carried out in a joint venture with hotel operator Kempinsky and US-based Islamic investment company Guidance Financial Group, but Barwa retains 100 per cent ownership.

Shaza Hotels has hotel projects in Bahrain, Cairo, Doha, Dubai, Marrakech, Muscat and Jeddah. A total of 10 hotels are planned in the short term.

In terms of real estate, emerging markets are a core part of the company’s development plans.

In May, Barwa International bought a 3-sq km plot of land in Khartoum, Sudan, and is working on a masterplan for the site.

It is also planning to establish a Sudan office, and in July the firm announced the development of a 3,000-square metre site in Libya.

MEED assessment

Barwa is quick to invest in new ventures and is keen to diversify its portfolio both geographically and by sector. It has more than QR9.2bn worth of property under development, up 170 per cent from QR3.4bn at the end of 2007.

Not a month seems to pass without a new Barwa venture, partnership, project or investment being announced.

However, delivery and consolidation must follow and is the next step for the company and its subsidiaries.

Challenges facing the firm include soaring construction costs, a lack of human resources and forecasts of downturns in real estate markets.

This summer, the Qatari government resolved to cap materials price increases by repaying the inflationary rises in products such as cement and steel to suppliers, taking the pressure off Qatar’s developers and contractors.

In addition, real estate experts expect property demand to remain high for both commercial and residential space in Qatar for at least the next five years, so for now the future looks bright for Barwa.