Investment in Damascus’ old city has risen sharply in the past few years. RASHA ELASS visits the ancient streets to see how the rebuilding is changing the landscape.

Majed al-Sabah has big hopes for ‘the street called straight’ in Damascus’ Old City. The part-owner of Syria’s first designer clothes store thinks this road will one day become a must-visit spot for monied shoppers. Sabah and his partners poured around US$1 million into their Villa Moda store to restore an authentic look of stone walls and arabesque arches – joining a wave of individual investors putting money into bricks and mortar in the Old City.

But while some of this money is recreating the former glory of the United Nations World Heritage site, there are fears that unbridled, unsupervised building could do more harm than good. The new investment is driven by a rise in real estate prices and tentative moves to lessen restrictions on business after decades of state control in the socialist country.

Municipality officials say applications for restoration licences have increased tenfold in recent years. More than 70 old houses have been turned into restaurants and bars in the maze-like alleys where wires poke from walls and second floors lean at precarious angles. But some residents fear the absence of a master plan, lax zoning laws and investors’ desire to make a quick profit could damage one of the oldest continuously inhabited cities.

There have been successes: a renowned hotel, restored second homes and the designer store, Villa Moda. But there is also a Wild West feel to some of the development. Residents of one neighbourhood recently complained to authorities about a well- connected investor who built a concrete second floor on top of a centuries-old house he had bought to convert into a business.
The inspectors withdrew as soon as his guards came out brandishing AK-47 rifles,” one neighbour says, speaking on condition of anonymity. “He ruined the house and the skyline with impunity.”

In Beirut, billions of dollars in private and government capital helped rebuild the city centre after the 1975-1990 Lebanese civil war. Although individuals are investing in Damascus, the funds are nowhere near as plentiful.

And now, politics has dampened investor enthusiasm with some financiers reluctant to finish projects since the US imposed sanctions on Syria in 2004 for what it said was the country’s support for terrorism. Syria is also in the international dock because of its alleged role in the killing of a Lebanese former prime minister.

For some, the relative slowdown offers opportunity: Youssef Takla, a Syrian expatriate, invested US$3 million to turn an old house into a luxury hotel with an ornate wooden entrance in the Jewish quarter, where a Syrian Jewish community once thrived.

You have to invest when the weather is bad because when everything is superb things will be expensive,” Takla says.

For Sabah, a member of the Kuwaiti royal family, the Old City has vast potential. “I think ‘the street called straight’ will be converted to the new Bond Street in Syria,” he says, referring to central London’s designer store-studded street.

Many businessmen would disagree, pointing to the government’s reluctance to open the retail sector to foreign competition, with import licences mainly granted to those close to the ranks of political power.

‘The street called straight’, where tradition says Saul stayed at the house of Judas over 2000 years ago, illustrates what needs to be done to preserve the Old City, but also what can go wrong.

The street is dotted with hundreds of alcoves with cement ceilings where vendors sell everything from nuts to wooden boxes decorated with mother-of-pearl. A row of buildings on top of the shops collapsed years ago and municipality workers only recently began to clear the rubble.

Mowafaq Doghman, head of the Old Damascus municipality, said inexperienced developers and a shortage of craftsmen sometimes led to dubious restorations. “One of the challenges facing Old Damascus is its weak infrastructure; plumbing, sewage, electricity and phone lines; restaurants have further weakened it,” he says.

In the Christian quarter, La Mamlouka boutique hotel, opened barely a year ago, has already won rave reviews from international travel magazines. The owner kept the feel of the original house: a narrow wooden door opens onto a courtyard with a fountain surrounded by an orange tree, a lemon tree, jasmine and grape vines. Overlooking the courtyard, there are two floors where the original family used to live. Each room costs at least US$112 per night.

“First everyone thought I was crazy and that nothing would come of it, but now everyone is in a hurry to do the same,” says May Mamarbachi, who spent US$1 million with a partner to restore the 17th century house.”