Q&A Fareed Abdulrahman - Chief Executive Officer of SmartCity
The Report Company: What is your vision for SmartCity and what has prompted the international expansion programme?
Fareed Abdulrahman: The vision is to use the 11 successful business parks we run in Dubai as a model and to expand internationally; to develop more business parks that have everything together in one place, where people can live and work.
We have 6,000 or 7,000 companies in Dubai across all our business parks, but there are clients who are not with us in Dubai because the Middle East is not their market. This is where the idea of going international came from: we have to go to the clients.
TRC: What progress have you made in developing the SmartCity Malta business park to date?
FA: We have building one, phase one at the moment, which has 12,000 square metres of smart office space. But this is just the start and there is more to come. If you look at the SmartCity Malta master plan, a whole city is being designed. We will provide the infrastructure for IT, power, roads, sustainability and so on. The companies that come here will want to have 24/7 operations and we encourage that. It is what we call mission critical support.
The infrastructure is almost there. We have built culverts under the ground which carry utilities such as power cables and water pipes, and the work on that is 65 per cent complete. We have worked together with [the largest local telecoms provider] Go on developing the IT network, to make it reliable and to provide services to the doorstep.
Work on the phase two buildings began in January 2011 and it will have four more blocks: two office blocks and two retail blocks. We haven’t launched phase two in the market yet. I don’t think it is a good time to launch anything right now, until things have settled down a bit in North Africa.
The second phase is due to be completed by the end of 2012. There could be around four to five phases, so from the first offices opening in October 2010 I would say the whole project will take 10 years and will be complete by 2020. Once complete, I would imagine there will be around 6,000 people here.
Along with the four buildings in phase two there will be a lagoon. We’re creating the environment and the ambiance to make it attractive for knowledge workers during the day and friendly for families to spend time here in the evening.
TRC: What companies have set up in SmartCity Malta and which type of companies do you expect to follow in the future?
FA: We have Cisco here, Hewlett-Packard and Go. We also have a US company, Meridium, that has been with us for almost six years in Dubai [Meridium specialises in asset performance management software and consulting services]. When they heard that we had established a business park in Europe, they were very encouraged. They didn’t have an office in Europe at the time, but they’re here now. The Saint James Hospital Group is opening a healthcare centre which will include a dental clinic and the Corinthia Group has a bistro and café.
We are in discussions with many companies. Last year we launched an initiative to bring Chinese and South Korean e-gaming companies to Malta. We are also in discussions with a lot of companies in Dubai. For example, we went to the Dubai International Financial Centre and did some marketing to the hedge funds there, which require a lot of IT infrastructure, and we have a lot of good leads from that.
For our business parks in Dubai we target five industries: ICT; media; healthcare; education; and logistics. It’s all knowledge-based companies, there is no manufacturing. So anything that comes under that is a possibility for Malta too.
We don’t look at the origin of the company, what we look at is what they need: is it cost efficiency, is it a presence in Europe or North Africa?...
TRC: What is your strategy for attracting more companies to SmartCity Malta?
FA: Our preferred marketing approach is to go and meet companies on a one-to-one basis. But we have also done a lot of road shows with the government of Malta. In 2009 we were in Milan and last year we went to China and Australia with the government. This year there is another one to market SmartCity Malta in five cities in India. This is our approach: first we market the country and then we market SmartCity Malta.
TRC: It sounds like you have a very strong relationship with the Maltese government?
FA: The government is our partner in the project. They own 9 per cent and they are always involved. As well as the marketing campaigns we do jointly, they’re also always there for us when we need assistance. That is one of the good things about Malta: you can always find people to help sort out any issues you have.
TRC: How does Malta fare as a place to do business compared to Dubai or India, where you are developing another SmartCity?
FA: We have two models when we look at any location: the Dubai model and the India model. Malta follows the Dubai model. In terms of area of land it is small, not big as in India, and the economy and the population are smaller too.
In the Dubai or Malta model, more marketing is required to make it attractive. When you look at India, because of the cost efficiency and the size of the economy it requires different types of marketing campaigns.
Dubai has always been a bridge between the Middle East and the Indian subcontinent and North Africa. Malta can be a bridge too. It can play a role as a stepping stone from the Middle East and North Africa to Europe.
Malta also offers a lot of incentives in terms of tax if you compare it to other countries around it.
TRC: Is there a large enough skills base in Malta to fill all the IT jobs that might be created?
FA: In three or four years’ time I think there will be. What I admire is how the government encourages fresh graduates to learn IT and be involved in IT and how they incentivise the students.
TRC: How different is SmartCity Malta from what your company has done in the past in Dubai?
FA: This reminds me of when we did phase one in Dubai. The idea was to go away from the city centre and develop a new site. The challenge in Malta is exactly the same. As we say in Tecom, it’s a new baby and we have to take care of that baby until it stands on its own.
There are many things we couldn’t offer 10 years ago in Dubai because the technology wasn’t there but now it is. Today we can offer fibre-optic cable to the doorstep to any client, and we have two generators on the roof so we can offer power at any time if anything happens.
TRC: Looking forward, what does Malta need to do to improve its competitive edge?
FA: What has to be improved is connections, in terms of flights. If you look across North Africa there are no direct flights except to Cairo twice a week. If I want to go to Tunisia, I have to go to Rome and then to Tunisia. There is only one flight a week to Greece,
Also, the processes within the government departments need to become simpler and easier compared to the surrounding countries, if Malta is to be more attractive and is to compete effectively. For example, if it takes me a month to hire a warehouse in Sicily, then in Malta it should take ten days.