Ahmed Saljouk is a visionary Leader Shaping Pakistan’s real estate sector. He is founding member and Director of Finance & Development, Alif Holdings (Pvt. Ltd) beyond his corporate responsibilities; Ahmed is a multifaceted individual with diverse interests ranging from Epistemology and theology to the immersive world of video games.

Following are the edited excerpts of a recent conversation BR Research had with him:

BR Research: Tell us a bit about your entrepreneurial journey.

Ahmed Saljouk: The first lesson I learnt about setting up a business was when I was 10 years old and started making marker cleaners and sold them through my sisters in their school. And the lesson was that a business is an entire ecosystem which only prospers when all stakeholders involved are profitable. My sister thought that their share of the profits was not enough and I –in my ego–ended the business because I was not ready to meet their demands.

I started my second business venture when I was 20 years old and I dropped out in the middle of a charted accountancy program, and from there it has been about 14 years now that I have been pursuing my passion for construction and development. This was the pivotal moment that marked the inception of my venture into the real estate sector.

BRR: So, what is Alif Holdings Pvt. Ltd. and what are you offering in the business?

AS: Alif Holdings is a real estate development company. As we would like to tell our customers, the future of your family is not a dream; it is a plan with Alif Holdings. The company’s mission is to redefine excellence in real estate development. With a keen eye for innovation and a relentless pursuit of perfection, I have been heading the finance and development strategies of the company.

Today, Alif Holdings Pvt. Ltd. stands as a beacon of excellence and innovation in Pakistan’s real estate landscape. I would say that we are primarily a property investment company based in Lahore where we use real estate – the most time-tested asset to generate wealth. The tool that we use is high-rise buildings. So far, we have launched 17 projects and delivered 14. We have earned a stellar reputation for our exceptional properties, exquisite hospitality and leisure facilities. Our core principles are client focus, innovation, responsible behavior, and people development.

BRR: Why do you deal in high-rise buildings only?

AS: Investment in high-rise buildings offers certain benefits. First, the constructed property as compared to agriculture land or land plotting takes time to get ready, which gives the investor the payment plan that is spread over several years. Investment is taking place over time in small chunks, which is an advantage for investors. Also, the investor gets hedged against inflation from day one and the risk is transferred to the developer. The investor also gets the capital gain on the constructed property at the time it is ready and the rental value that is being accumulated over time. And finally, the investor also gets the gains from any price appreciation that takes place beyond the completion of the constructed property. This price appreciation could be due to the real estate sector boom that might be experienced at any time. These are the reasons why we believe constructed property is the best asset in the real estate sector for investment. And within constructed property, our expertise lies in high-rise buildings because we believe that we can deliver high return and high value with the addition of various amenities, services and ecological benefits by utilizing small space in comparison to other types of constructed properties. To date, we have launched over 400,000 square feet worth of projects.

BRR: What kind of high-rise buildings in Lahore are you talking about?

AS: Our position in Lahore is akin to Zara’s position in fashion – a premium, high-street brand that is approachable and affordable. Why would anyone, especially in Lahore, buy an apartment worth Rs30 million when they can get a 5 Marla house for the same price? Alif Holdings solves this dilemma with its competitive pricing with an obvious discount. In one of our projects – AR-8 – we offered a two–bedroom apartment with an initial price of around Rs 65 lacs as compared to Rs 150 lacs for a 5-marla house at that time which could accommodate 2.5 of our 2-bedroom apartments. Today the same asset is trading in the Rs 130-140 lacs bracket. We are proud of our financial management and planning.

Our latest project is the Waterfall Towers. It’s near Bahria Town, Lake City and Ring Road Interchange. Construction is going on at a rapid pace; 60 percent of the frame structure is complete, and we will be completing the project in 2 years. And we are predicting using our successful models and some algorithms that the one-bed apartment in this project that is currently valued at Rs 82 lacs will be around Rs1.25 crore by the time the project is ready. There are about 24 amenities in this 250 plus – apartment building. We categories this project as luxury which is affordable. This category has always been our forte.

The sustainability of such projects depends on two factors. One is the efficient management and maintenance of services promised to the clients and investors. And second is its location and proximity to buildings and other amenities. We have chosen the location for Waterfall Towers because of the presence of many universities and institutes in the surrounding area, but little to no presence of hostels. We believe that the presence of around 10 universities will increase the rental demand, which will increase the rental yield and lead to an increase in capital gain.

BRR: As an industry insider, how do you view the real estate sector given the economic uncertainty and political instability in the country rife over the past couple of years?

AS: The market sentiment has been severely affected by the political instability and economic destabilization. But I would like to quote Warren Buffet here: The best time to buy is when there is blood on the streets. This is the right time for savvy investors to invest. We believe things will get better moving forward as the economy stabilizes. The currency has been stable, and we foresee it to be stable as the government and IMF have reached a provisional agreement on the release of $1.1 billion tranche. Also, the government has been able to control the current account deficit. The real estate sector is directly affected by the cost in the construction sector.

BRR: An integral part of the real estate sector is house finance. Pakistan sits way behind other emerging economies when it comes to mortgage sector. There is a lack of understanding and availability of mortgage products in the country. And the regulatory environment is often quoted rigid for house finance. Do you see this as a hindering factor for growth for the real estate sector?

AS: Pakistan’s mortgage to GDP ratio is less than 0.5 percent. I would say that it is more of a banking issue and a perception issue.

You cannot talk about mortgage in a vacuum. In general, banking products have low penetration in the private sector primarily because the banking sector doesn’t need to lend to the private sector when the government is the biggest borrower. And the legalities, insurance and the system in the country make recovery of loans a tedious and difficult task for the banking sector.

Secondly, the perception and acceptability issue exist in the country due to the concept of interest in all sorts of financial products in Islam.

The only solution would be a genuine Islamic banking solution.

BRR: What are your plans over the next 5 years?

AS: We want to be the most reliable, secure and top property investment and real estate development organization, not only in Pakistan but the world. Our ten-year plan is to not only to expand globally, but to get global investors to invest in Pakistan’s real estate. The returns we can give them here are much better than what we can offer them globally.