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Brotherly love

From 5-star hotels to real estate branding, the Galadari family boasts a succession of Dubai firsts. Jamie Stewart caught up with GIO boss Rashid Galadari to find out what makes the family tick.

INTERVIEWS, Business

From 5-star hotels to real estate branding, the Galadari family boasts a succession of Dubai firsts. Jamie Stewart caught up with GIO boss Rashid Galadari to find out what makes the family tick.

A little love between siblings is a positive thing. One brother may be there for the other; he may turn to the other for support; he may always be ready to lend the other a hand.

"So if I hadn't chosen the City of Arabia, my brothers would probably have beaten me up," says Rashid Galadari.

But on the other hand, they may simply beat you up.

Their company name is a family name, just like ours. - Rashid Galadari, chairman, GIO Developments

Rashid Galadari is chairman of GIO Developments, part of Galadari Investment Office, the holding group owned by Galadari himself.

Despite the threats of his brothers Ilyas and Musftafa, owners of the City of Arabia, a US $5 billion (AED18.4 billion)project in Dubailand which Galadari is helping to develop, he has kept himself busy of late with a series of announcements.

The latest concerned the Gianfranco Ferré Stresa, a joint venture between GIO and Italian fashion house Gianfranco Ferré. The $1.2 billion mixed use development is still in its infancy, with the location yet to be announced.

Contractors have been approached privately, and Galadari hopes to begin construction by the end of the year.

Despite the tie-in, Gianfranco Ferré Stresa aims to distance itself from the recent trend of real estate branding, which Galadari sees as somewhat superficial.

"Ferre realised that we respect brands," he says. "We are not just here to take what they have worked for throughout their lives and squeeze every single drop of juice out of it. Their company name is a family name, just like ours."

Real estate branding in the GCC has recently seen tie-ins between names as recognisable as Emaar and Armani. But Galadari insists that to him, there is more to it than making a quick buck.

"We were the first to introduce the concept of branding to the region," he says, referring to the G-Emporium, his group's venture with designer Philippe Starck.

The G-Emporium is in the City of Arabia development. It includes the residential G-Tower and the commercial G-Office tower. Starck is responsible for the interiors of the G-Tower, while his firm, yoo, is looking after the G-Office interiors.

The G-Tower was announced back in 2005, before Starck had become involved. "At the time it was just the G-Tower," Galadari says.

"If you know the prices I sold at in those days - those buyers are very lucky individuals, I promise you."

A sign that branding adds value to a development? If done in good faith, certainly. But Galadari says there are other factors involved, such as Dubai's notorious market conditions.

"Dubai is positively the most unusual market," he says. "Talking as a local, if this was a normal market I would say "the market will stabilise, there'll be a correction."

"I have been hearing about corrections for the past five years, and it has just not happened. At least then my feasibility studies would make more sense."

Like many involved in Dubai's real estate, Galadari says he would like to see the market stabilise, so as not to see his prices compared to a product that he believes does not deliver the goods.

"It irritates me that my prices are going to be compared to Mr X's," he says. "Now we have people selling towers that I wouldn't pay 500 dirhams for, and they are asking for 2,000 to 3,000."

Central to the issue of end-user value, and more important than the trend towards branding and the need for developers to live up to their price-tags, comes something simpler - quality of construction.

It's all very well boasting a bathroom designed by an A-list celebrity designer, complete with a branded gold-plated toilet seat, but if construction is not up to standard, you have a problem.

As a long-standing family business, Galadari says GIO has spent time and effort cultivating its relationship with its contractors.

In the case of the G-Emporium, Galadari is working closely with Simplex Infrastructure.

"It wasn't about price," he says. "You have people who can come up with the most amazing price, but when they start, they do not deliver."

GIO and Simplex are working with a semi-hybrid contract, worth $360 million. The price is fixed, but under certain circumstances, it may fluctuate a little. Galadari says such leeway has become a necessary part of doing business in the region.

"Many contractors - they are ready to walk away," he says. "They are ready to say "keep our bond, we don't care". It all depends on your relationship with your contractor."

Despite the importance of this relationship, it is clear that Galadari is no pushover when it comes to the art of negotiation. The family business would not have lasted long had the Galadaris not been prepared to stand their ground.

"There's so much that contractors can do as well," Galadari explains. "The cost of raw materials may appear beyond their control, but it is not as beyond as people think.

"Some contractors purchase way in advance, so that the raw materials are already there. It's a case of deciding who to go with."

The same rings true not only for contractors, but everybody involved in the process from inception to handover.

Both G-Emporium buildings have been designed by architect Alex Vacha, who has designed the entire City of Arabia project. The G-Emporium renderings show two 280m towers, similar in appearance but distinct in detail.

"I really want it to look like that when it is standing," Galadari says. "It is so bad when you see these nice pictures, your expectations are high, and then you see it standing, and it looks horrible."

The buildings incorporate elements of the forthcoming green building regulations, which Galadari says is important, when done correctly.

"I would build to green standards whether it was compulsory or not," he says. "Without sounding like one of those contestants on Miss World, it's the future that you have to think about."

Galadari should be careful. Thanks to selecting the City of Arabia, he may have escaped the wrath of his brothers thus far.

But if there's one thing that your brothers will beat you up for - it's sounding like a Miss World contestant.

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