By Lennox Samuels
Two men, one American, the other Iraqi, daubed wet cement on a short stack of limestone bricks and laid the cornerstone for what is to be the first new five-star hotel in Baghdad since the days of Saddam Hussein. A couple dozen people standing in 115-degree heat on a parched piece of land near Zaitun Street and Al Qadisiya Highway, just inside the International Zone, watched the tableau. Most of them understood that the ceremony was a symbol of Iraq's accelerating efforts to transition to life beyond wartime. And the developer's representative spelled it out for those who might not have gotten the message. "This project will be a signal that will go out all over the world that the economy of Iraq is ready for investment," declared Robert K. Kelly, CEO of Delaware-based Summit Global Group.
It will take more than such baby steps to rebuild Iraq, but the cornerstone event is part of a growing trend toward normality in Iraq as violence subsides. Parts of the country remain dangerous and terrorists still occasionally launch attacks that result in mayhem and high body counts, but there is a sense that real change is in the air. "Today we can stand here fairly safely and lay the cornerstone for the future of Iraq," said Brig. Gen. David Perkins, a newly arrived Multinational Force-Iraq spokesman. "This project encapsulates progress across all the aspects of improving security, creating good government and reviving the economy."
Construction on the $100 million, 300-room hotel is to begin in 30 to 45 days. The project is expected to create 500 jobs and be completed within 12 months, Kelly says. The development, dubbed Hotel Two Rivers (Iraq is home to the famous Tigris and Euphrates rivers), will rise in the shadow of monuments to the megalomania of Hussein. Nearby stand the hulking Adnan Palace and the giant Crossed Swords that commemorate the ill-fated Iraq-Iran War.
Summit Global, a group put together by venture capitalists essentially for this project, has signed a 50-year lease on the property, which is approximately 10,000 square meters, says Kelly, who is based in Washington, D.C. The Iraqi government agreed to a tax-free deal for the project, which draws on "capital from a wide range of sources" including Iraqi interests, Kelly says. Both he and Dr. Ahmad Ridha, chairman of the National Investment Commission of Iraq, stressed that the project will be built by Iraqis and ultimately staffed by them. The two men shared the cornerstone-laying honors. Summit Global is negotiating with hotel companies to run the facility, but is not yet ready to say whether it will bear the brand of a well-known chain like Sheraton, Hilton or Hyatt.
Iraq's expanding stability has fostered sundry business schemes and talk of big economic ventures. Recent rumors, for example, have floated the prospect of a multibillion-dollar business and tourism district in the Green Zone that would be a bankrolled in large part by Saudi interests. There has been talk also of a five-star Marriott Hotel. Nobody, including Marriott, would confirm any such plans. A few less-grandiose projects are proceeding, including a new convention center and small motel near Baghdad International Airport, says Raad Ommar, CEO of the Iraqi-American Chamber of Commerce.
Kelly, meanwhile, says Summit's project is based on solid and clear-eyed planning. "We have studied the investment situation in Iraq and we think it is very positive," he says. "We like to act fast and we like to act first." As for the war, which is by no means over, "We believe the security situation is just right. We don't see it as risky," he tells NEWSWEEK. He also believes there is enough demand for a good hotel, specifically among business travelers. Certainly not many tourists are rushing to visit Iraq. On the other hand, apparently buoyed by declining violence in Iraq, a number of countries have indicated they will open or re-open embassies in Baghdad. The list includes the Philippines, Qatar, Bahrain, United Arab Emirates and even Kuwait, which has not had an ambassador in Iraq for 18 years. Considering that hotels like the Palestine and Ishtar Sheraton have fallen on tough times and the venerable Rashid has become less desirable, Summit's new inn could well serve as a temporary home for diplomats who will need accommodations while their permanent quarters are readied.
