Power and beauty: Foreigners snap up Istanbul’s iconic waterfront mansions

1 / 3
Real-estate brokers in Istanbul said that out of around 600 waterside yalis along the Bosphorus, 60 were currently up for sale. (AFP)
2 / 3
Prospective buyers of the yalis are likely to be from the Middle East. (AFP)
3 / 3
Prospective new owners can expect to pay up to $100 million for one of the premium properties along the Bosphorus River coast on the Asian side of Istanbul. (AFP)
Updated 09 October 2018
0

Power and beauty: Foreigners snap up Istanbul’s iconic waterfront mansions

  • Dozens of yalis are now up for sale as Turkey enters a more troubled economic period and owners seek to cash in their luxury assets
  • Prospective new owners can expect to pay up to $100 million for one of the premium properties

ISTANBUL: They are among Istanbul’s most iconic sights — magnificent waterside mansions strung out along the Bosphorus as the waters of the strait dividing Europe and Asia lap almost at their front doors.
Once the preserve of the Ottoman elite and affluent foreigners working in what was Constantinople, the mansions, known as yalis, were made famous in novels and more recently through modern Turkey’s hugely successful TV soap operas.
But dozens are now up for sale as Turkey enters a more troubled economic period and owners seek to cash in their luxury assets.
Prospective new owners can expect to pay up to $100 million for one of the premium properties — but have the chance of obtaining a Turkish passport thrown in.
With such a hefty asking price — as well as the opportunity of becoming a Turkish national — buyers are likely to be foreigners, heralding a drastic shake-up in the mansions’ ownership.
Real-estate brokers in Istanbul said that out of around 600 waterside yalis along the Bosphorus, 60 were currently up for sale.
The Turkish lira this summer plunged in value as markets reacted to a bitter spat with the United States and many buyers think now is the perfect time to snap up property assets while the currency is cheap.
Sales have to be in Turkish lira — President Recep Tayyip Erdogan’s government has banned the sale, rent or leasing of property being conducted in, or indexed to foreign currencies.
Brokers say that in a major turnaround, prospective buyers are almost never Turkish and are likely to be from the Middle East, especially Ankara’s closest Gulf ally, Qatar.
“With the lira losing value, Istanbul has become a paradise for people from the Gulf with higher purchasing power in their hands,” Hamed Elhamian, sales director at ANKA Invest, said.
“Investors from the Gulf believe that the lira will rise in value in the near future and their investments will appreciate in a very short time,” he said.
Ugur Ayhan, a luxury real-estate consultant, also said foreign buyers had been showing greater interest in Turkey over recent months.
“Our potential clients are largely from Middle Eastern countries. We see people from Azerbaijan and Iran but we have a customer portfolio dominated by Qatar,” he said.
Along with the financial incentives, another attraction of buying a property is the possibility of gaining a Turkish passport, which offers eased or visa-free travel to key destinations.
Under a decree issued last month, Turkey made it easier for foreigners to become Turkish citizens by reducing the financial and investment criteria for citizenship.
Foreigners now need to have $500,000 deposited in Turkish banks — down from the previously required $3 million — while fixed capital investment was cut from $2 million to $500,000.
And crucially, individuals owning property worth $250,000 or more are now also entitled to become Turkish citizens, compared with the previous value necessary of $1 million.
Yet Ayhan said that, while the latest measures would ramp up demand for newly-built apartments in Istanbul, a yali was an ultra-luxury asset beyond the range of most buyers.
“It is not possible to buy a luxury apartment, let alone a yali with $250,000,” he said.
Among the hundreds of mansions along the two sides of the Bosphorus, 360 of them are of historic value, according to real-estate broker Pinar Ayikcan Tuna.
For the historic mansions, potential buyers need to receive permission from both the development directorate of the Bosphorus and the council of monuments for any renovations or to fortify a building’s exterior facade.
“Turkish laws require that historic buildings are renovated or restored according to the original,” Ayhan said.
Some of the mansions are still owned by members of the Turkish elite, including the two largest family conglomerates: Koc and Sabanci.
However, said Elhamian: “The domestic interest in the real estate is very low.”
“Many local Turkish citizens and developers are looking to sell their real estate to foreigners who are looking to buy luxury properties worth more than the $250,000 needed for citizenship.”
Turkish soap operas, often with dozens of episodes lasting two hours each, hold the Arab world in thrall and have also tempted potential buyers from the Middle East.
Many of the soaps, which range from modern romances to historic dramas, have evocative settings in waterside mansions on the Bosphorus. Tour companies in Istanbul even offer Arab tourists bus trips to the locations.
Interest surged in particular following the hit 2008-2010 series “Ask-i Memnu” (“Forbidden Love”), which ran to almost 80 episodes and was wildly popular in the Arab world.
Its dramatic scenes of love and betrayal within a rich Istanbul family — based on an over 100-year-old novel but updated to the present day — were filmed in a historic yali in the city’s Sariyer district.
“Those soap operas are actually our big advertisement overseas,” Tuna said.
“People from Middle Eastern countries come and buy these kinds of properties here because having a Bosphorus mansion in Istanbul is like a signature of power and it is a very unique beauty.”
Reha Grandjean, French-Turkish and family owner of a mansion on the Bosphorus, said to own such a place was special.
“It is a particular property because as soon as one of them is put on sale, everyone wants their ‘yali’, everyone wants their little paradise.”


No need for more talks over draft budget: Lebanon finance minister

Updated 21 May 2019
0

No need for more talks over draft budget: Lebanon finance minister

  • Lebanon’s proposed austerity budget may please international lenders but it could enrage sectors of society
  • Lebanon has one of the world’s heaviest public debt burdens at 150 percent of GDP

BEIRUT: Lebanon’s finance minister said on Tuesday there was no need for more talks over the 2019 draft budget, seen as a vital test of the government’s will to reform, although the foreign minister signalled the debate may go on.
The cabinet says the budget will reduce the deficit to 7.6% of gross domestic product (GDP) from last year’s 11.2%. Lebanon has one of the world’s heaviest public debt burdens at 150% of GDP.
“There is no longer need for too much talking or anything that calls for delay. I have presented all the numbers in their final form,” Finance Minister Ali Hassan Khalil said.
But Foreign Minister Gebran Bassil suggested the debate may go on, telling reporters: “The budget is done when it’s done.”
While Lebanon has dragged its feet on reforms for years, its sectarian leaders appear more serious this time, warning of a catastrophe if there is no serious action. Their plans have triggered protests and strikes by state workers and army retirees worried about their pensions.
President Michel Aoun on Tuesday repeated his call for Lebanese to sacrifice “a little“: “(If) we want to hold onto all privileges without sacrifice, we will lose them all.”
“We import from abroad, we don’t produce anything ... So what we did was necessary and the citizens won’t realize its importance until after they feel its positive results soon,” Aoun said, noting Lebanon’s $80 billion debt mountain.
A draft of the budget seen by Reuters included a three-year freeze on all forms of hiring and a cap on bonus and overtime benefits.
It also includes a 2% levy on imports including refined oil products and excluding medicine and primary inputs for agriculture and industry, said Youssef Finianos, minister of public works and transport.
“DEVIL IN THE DETAIL“
Marwan Mikhael, head of research at Blominvest Bank, said investors would welcome the additional efforts in the latest draft to cut the deficit.
“There will be some who claim it is not good because they were hit by the decline in spending or increased taxes, but it should be well viewed by the international community,” he said.
Jason Tuvey, senior emerging markets economist at Capital Economics, said: “The numbers will be of some comfort to investors, but the devil will be in the detail.”
“Even if the authorities do manage to rein in the deficit, it probably won’t be enough to stabilize the debt ratio and some form of restructuring looks increasingly likely over the next couple of years,” Tuvey said.
The government said in January it was committed to paying all maturing debt and interest payments on the predetermined dates.
Lebanon’s main expenses are a bloated public sector, interest payments on public debt and transfers to the loss-making power generator, for which a reform plan was approved in April. The state is riddled with corruption and waste.
Serious reforms should help Lebanon tap into some $11 billion of project financing pledged at a Paris donors’ conference last year.
Once approved by cabinet, the draft budget must be debated and passed by parliament. While no specific timetable is in place for those steps, Aoun has previously said he wants the budget approved by parliament by the end of May.
On Monday, veterans fearing cuts to their pensions and benefits burned tires outside the parliament building where the cabinet met. Police used water cannon to drive them back.