How ‘Touristic Laws’ guarantee success for Morocco’s tourism industry

When a young 43 year old king unveils to the world his ambitious strategy to boost tourist arrivals to his country from 4.4 million in 2001 to 10 million by 2010 thus creating 600,000 new jobs and forming 20% of the nation’s GDP, the last thing that king wants is egg on his face. He’s going to pull out all the stops to steer the vision to fruition. This describes exactly the challenge facing King Mohammed VI of Morocco.

The mega coastal resorts under the moniker ‘Plan Azur’ are the glue holding his vision together. These six facility-packed holiday spots will spearhead the growth and the Government has implemented certain ‘touristic’ laws which guarantee that failure is not an option. Mediterrania Saïdia, home to Le Jardin de Fleur, is the flagship Plan Azur resort, heavily in the throes of construction and the only one of the six destined for the coveted Mediterranean coastline. The 11 Le Jardin de Fleur resorts-within-a-resort, ranging from spacious apartments to grandiose villas, provide a textbook example of how King Mohammed’s touristic laws safeguard his country’s future and in turn, each individual purchaser’s investment.

Adam Cornwell, MD of GEM Estates, an emerging markets real estate agent engaged in the promotion of Le Jardin de Fleur, comments, “King Mohammed’s a very astute individual, with a PhD in Law and the established tourist hotspot of Spain 14km across the Straits to learn from, he has maintained a certain property ownership structure for success. He knows that empty lock-up-and-leave resorts contribute nothing to the economy and create little in the way of full time employment; they must be bustling all year round. Each Le Jardin de Fleur project is termed either RT (now RIT) or VVT indicating ‘Résidences Touristiques’ and ‘Villages de Vacances Touristiques’ respectively. This set-up dictates that owners may entrust their property to the hands of a professional, licensed, management company who will let them out as part of a minimum nine year leaseback scheme”.

Adam continues, “This is not to say that the properties are not freehold, thanks to a signed agreement between Mediterrania Saïdia and the Moroccan Government, they are. Purchasers at Le Jardin de Fleur acquire full title deed at completion and according to the Law of Horizontal Division, title holders can see their precise share or percentage of ownership of their apartment within the whole community. In addition, the recent modification of RT to RIT (Résidences Immobilières Touristiques) earlier this year reinforces purchasers’ right to title deed and makes it clear that the leaseback arrangement is optional. Every Le Jardin de Fleur purchaser can choose to opt out of the rental programme and maintain full use of their property. However, a guideline is in place for 70% of properties to be let out and just 30% kept for personal use to attract internationally respected management companies, companies that would certainly not see the advantage in managing a ‘ghost town’.”

The biggest beneficiary of the VVT / RT / RIT set-up is the private investor themselves. They not only have an asset that will appreciate in value as the market matures, currently 20 – 25% per annum, but also have a hard-working asset bringing in a healthy rental income, typically enough to cover any mortgage. The Moroccan Government is also refraining from taxing rental income for five years from taking ownership of the property, a phenomenal incentive to participate. Personal use is always an option, regardless of whether people opt-in or opt-out of the leaseback, and if the owner’s property happens to be let out, an alternative Le Jardin de Fleur resort will be offered, ideal if friends are coming over and a VVT villa would be more suitable than your own RT apartment.

Finally, as King Mohammed’s goal is to attract tourists, and boost employment, Plan Azur ‘touristic’ properties have to be delivered fully fitted and furnished to European standards and be maintained immaculately. They also have to have access to an array of facilities to attract those lucrative high net worth customers. Each Le Jardin de Fleur resort has its own Clubhouse and amenities ranging from swimming pools, gymnasiums and tennis courts to children’s clubs and restaurants. The 24-hour concierge will source housekeeping, maid services and babysitting whilst a reciprocal agreement between the 11 Le Jardin de Fleur resorts will allow owners to avail themselves of all of the communal facilities across the board. This includes the flagship 204-room five star Sahara Beach & Spa Resort with its luxurious Spa & Thalassotherapy centre. To boot, all of Mediterrania Saïdia’s offering is on the doorstep – three 18-hole golf courses, an 840-berth marina, 6km of beachfront with 17 beach clubs, a Moroccan Medina shopping experience and an equestrian centre, to name but a few.

The end result will make King Mohammed proud. Upon completion Mediterrania Saïdia will be a year-round bustling resort creating permanent jobs for local people and happy management companies making healthy profits to be passed on to happy home owners. Far from having egg on his face, the King will be held up to the world as an example of a man who knows his onions when it comes to creating a tourism industry.

Newsflash – Le Jardin de Fleur is scheduled to collect two awards in the prestigious CNBC Arabian Property Awards 2007 at a gala ceremony in Dubai in October.

For further information visit gem-estates.com.