< Previous20 CEO MIDDLE EAST JANUARY 2024 INVESTMENT Asset managers and owners must focus on total revenue and profitability per square foot, Rajaram says one specific asset class over another. In the case of the Covid-19 pandemic, the impact was acutely felt on upper- upscale business/conference hotels, while extended-stay and leisure hotels fared significantly better. In 2021, STR noted that Middle East and US hotel demand had essentially reverted to pre-pandemic levels while business and group demand was still lagging behind at 60-80 percent of pre-pan- demic levels. Venturing further afield to more mixed-use developments, which include residential or a co-working component, can provide further risk mitigation. Allowing the portfolio to be focused while also building flex- ibility with assets that can diversify risk will provide the much-needed protection against seismic impacts within the industry and the greater economic climate. Liquidity management Nothing quite matches the impor- tance of having sufficient cash re- serves – a position that is often easier said than achieved. There are numer- ous ‘benchmarks’ in the industry that recommend a three to six month working capital, but it is imperative that owners and asset managers look beyond this basic metric. While the individual hotel asset can manage with such benchmarks, an overall as- set portfolio’s cash requirements can be far greater depending on the age and positioning within its lifecycle. Ranging from a strategic change in payroll expenses or an upcoming 10-year Capital Expense (CAPEX) investment plan, to planned disposal of certain assets, each can have a varying impact on the liquidity levels of a business. Constantly keep- ing all these requirements top of mind will ensure that both working capital requirements and long-term cash are protected. This available cash can be placed in Certificates of Deposit, which allow for regu- technology, accessibility, design or sustainable practices will eventually lead the asset to fall behind its com- petitive set of hotels and drive down financial performance. Another aspect of this strategy is, when building a greenfield asset, to always build for quality and ensure each asset is built to ‘stand the test of time.’ This will help the asset to hold value for as long as possible, and long-term valuations will hold higher even during challenging times. Ensuring maximum revenue within the asset Oftentimes hospitality real estate thinking is only focused on typical key performance indicators such as oc- cupancy, Average Daily Rate (ADR), Food & Beverage (F&B) covers, aver- age food and beverage check and only looks at the uses within departments of rooms, F&B and banqueting. Asset managers and owners must focus on total revenue and profitability per square foot. An owner’s total capital outlay is on the entire BUA and not just the rooms and restaurants. Every useable space within the asset should generate revenue and profitability is critical to ensure the asset fully real- ises its financial potential, to sustain itself across seasons. Think about leasing unused spaces within the lobby for a giftshop, corridors for an ATM, or elevators for digital signage, which can capture un- realised revenue and further support profitability. For example, Stirling Hospitality Advisors’ proprietary data shows that driving revenues in non-core components of a hotel can generate up to 1-2.5 percent of top-line revenue based on strong flow through profitability and can contrib- ute almost 2-4 percent of Adjusted Net Operating Profit. By keeping these strategies in mind, asset managers and owners can better safeguard their hospitality investments. lar interest payouts or in Fixed Deposits that can give a business the necessary comfort to weather almost all negative industry impacts. For example, today’s deposits can yield over 5 percent in interest. This equals or exceeds the current furniture, fixtures, and equipment (FF&E) reserve percentages, thereby enabling owner funds to generate free cash flow, which can compound if prudently placed in deposits. Lastly, it is critical to have a robust relationship with lenders and suppliers. Even when times are good, it is prudent to always assess current lender terms or key payable and receivable terms with suppliers. These regular checks ensure a posi- tive cash flow cycle and give owners necessary buffers, if and when financial conditions worsen. Best in class and Unique Selling Proposition (USP) investments As the hospitality industry is constantly evolving, impacted by external changes in technology and labour, ensuring assets and the overall portfolio are always ‘best in class’ is crucial to mitigate negative shocks to the business. For example, developing and upgrading hospitality assets that do not have best-in-class COVER STORY | SHAI ZAMANIAN 22 CEO MIDDLE EAST JANUARY 2024JANUARY 2024CEOMIDDLE EAST23 SHAI ZAMANIAN | COVER STORY EO Middle East sits down with Shai Zamanian to discuss the road to success of The American Legal Center – an immigration firm laser focused on the United States EB-5 Golden Visa program – and how it has earned a reputation of excellence within the Middle East. The EB-5 program provides foreign investors the op- portunity to obtain US residency for themselves and family, including their spouse and children under the age of 21, with an investment of $800,000 in a real estate development project in the US. For over the past decade, he and his team of US licenced law- yers have successfully navigated this intricate landscape of immigration law, earning them the distinction of handling 6 percent of all global EB-5 applications in June 2021. Inspired by his own personal experience of migrating to the United States at a young age, Zamanian’s journey is marked by a vision to build a bridge between East and West, facilitating the dreams of families seeking a better future in America. In this exclusive interview, Shai delves into the challenges he overcame while setting up his business in Dubai and educating families in the Middle East about the EB-5 Golden Visa route. The success of this investment immigration program can be credited to the US economy’s need for cash injection and the burgeoning desire of SHAI ZAMANIAN, FOUNDER AND DIRECTOR OF THE AMERICAN LEGAL CENTER, IS MAKING WAVES IN THE MIDDLE EAST WITH HIS IMMIGRATION FIRM’S FOCUS ON THE US EB-5 GOLDEN VISA PROGRAM C PASSAGEWAYS TO AMERICA COVER STORY24 CEO MIDDLE EAST JANUARY 2024 COVER STORY | SHAI ZAMANIAN The US Congress set up the EB-5 Program in 1990 to help stimulate the economy through job creation and capital investment by foreign investors upper middle class families abroad in accessing the American dream. The EB-5 program’s popularity surged after the financial crisis of 2008. With traditional funding sources dwindling amid the Great Recession, banks hesi- tated to lend to real estate projects. This was the time in which the EB-5 program came to light. “Difficulties in accessing traditional domestic financ- ing brought on by the Great Reces- sion, along with a rise in the number of wealthy investors in developing countries, led to a spike in interest in the EB-5 program,” Zamanian tells CEO Middle East. Seizing the opportunity to bring the EB-5 program to the East, Shai – an avid reader, US attorney, and entrepreneur – flew from his life in the West to educate an untapped mar- ket – the Middle East. Armed with the EB-5 industry? At a very young age, my family and I embarked on a journey to the West from a war-torn nation in the Mid- dle East. Sacrificing cherished family heirlooms and leaving everything behind, my parents paved the way for us to seek refuge in the West, yearning for the promise of a brighter future. From the moment we landed, all our relatives looked to my parents for ad- vice on how to follow in our footsteps. I first heard about the EB-5 pro- gram at the age of 10. My family and I were visiting Iran during one summer, staying at my aunt’s house. We were sitting around with my cousins and uncles and a commercial about the EB-5 program came on satellite TV – the promise of access to America and the possibility of tasting the American dream through a $500,000 investment $75M The capital raised by The American Legal Center for US-based EB-5 projects a bachelor’s degree from UCLA and a Juris Doctor from the University of Miami School of Law, Zamanian has been the leading voice on EB-5 re- lated matters since his move to Dubai in the early 2010s. To date, he only agrees to file a fraction of prospective families seeking the program, as he explains, “We will not move forward on an application unless we are near certain of approval.” What initially attracted you to JANUARY 2024 CEO MIDDLE EAST 25 SHAI ZAMANIAN | COVER STORY The American Legal Center operates with a team of US licensed lawyers that specialize in the EB-5 permanent residency program from the perspective of applicants from the GCC, Arab nations, and the emerging markets in the US The commercial ended and a heated discussion ensued. “No one has that kind of money,” one uncle said. Playing the devil’s advocate, another uncle urged, “At least it’s a legitimate way to build a future for your kids.” That conversation influ- enced my perception of the dispari- ties between the privileged and the less fortunate, highlighting the dual role of money as both a barrier and a gateway. Little did I know that this intro- duction to the EB-5 program during a summer gathering in Iran would shape my understanding and even- tually lead me to a pivotal role in facilitating similar journeys for others in pursuit of the American dream. The second experience with EB-5 that guided me to where I am now was working at the nation’s largest home builder at the time – Lennar Homes – after law school graduation. I didn’t know much about the world around me but I was willing to be a sponge absorbing all the information being flown around by virtue of being surrounded by knowledgeable profes- sionals. My desk wasn’t too far from the director’s, and concepts of finish- ing commercial development projects through alternative forms of financ- ing were often discussed. This was post the Great Recession and banks were not lending for large commercial development projects as willingly. The concept of using the EB-5 program as a form of financing came to light. I became intrigued that investors from the East as far as China were investing in localised projects for the same hopes and desires that my parents had when we embarked on our journey. I took it upon myself to learn as much as I could from the project side, understanding the underpin- nings of construction finance and the nuanced difficulties compared to conventional lending and thought, “why don’t I take this knowledge and transplant it back to the Middle East where my life story began?” So you left your life in the US and came to Dubai to start your business. Why did you choose Dubai as your destination? Prior to moving to Dubai, I never visited the city and didn’t have any friends or family here. I packed three bags and landed in Terminal 2. At the time, Terminal 2 wasn’t as polished as it is now. I remember walking out and immediately thinking whether this was the right choice. Throughout my “A BUSINESS REQUIRES PROFITABILITY AT THE EXPENSE OF SACRIFICE. LACE UP YOUR BOOTS, IT’S WORTH THE JOURNEY”26 CEO MIDDLE EAST JANUARY 2024 COVER STORY | SHAI ZAMANIAN first few years, I thought about giving up and heading back to California to conjure up another entrepreneurial idea but I’m glad I stuck it through. Dubai made sense because there were facets of the West implanted here. It’s this masterplan project or idea that just happened to pan out, where many families similar to mine migrate for the future betterment of their families. But many times it’s a stepping stone since there aren’t concrete retirement options here. So it made sense to place my efforts in a place where I could be the most effective, acting as that bridge between East and West. What challenges did you face starting your business, and how did you overcome them? Any advice for today’s entrepreneurs? When starting a new business, you need to be humble. Nowadays I see entrepreneurs jumping at the idea of fundraising and giving up equity in their business for money and this, to me, is tragic. This concept of selling a slice of your business for money sometimes hinders entrepreneurs from what should be their main goal – to be profitable from an early stage. Yes, there are examples of companies such as Uber that took over a decade to become profitable but that’s under- standable considering their objective of entering the marketplace and es- tablishing themselves as the ride- sharing app of choice in a saturated market. Just bootstrap it and share an apartment with a roommate. Skip the trip to Paris – go when it’s time and when you’re confident. When I first made the journey to Dubai, I had with me about 35,000 in personal savings. I didn’t have the money to set up a lavish office. It’s hard to capture people’s hearts and trust without a proper setup and without years of experience within a The American Legal Center are constantly aware of topics that pertain to clients and investors seeking this program from the Middle East and emerging marketsJANUARY 2024 CEO MIDDLE EAST 27 SHAI ZAMANIAN | COVER STORY city. So, I was driving around town to people’s offices and meeting people in lobbies of fancy hotels, pitching this concept and idea. Sometimes in the depths of August heat in a Kia Picanto that lacked air conditioning with the prayer that this would be worth it. Showing up to these meet- ings, looking like I walked out from the Seventh Circle of Dante’s Inferno and essentially practicing my pitch. I was eating Subway everyday trying to cut costs. For the first year, every door was closed shut. There were drives that I would take to Abu Dhabi, only to be sent back after a 20-minute meet. It was only after a year had passed that some clients understood my relent- less pursuit and the fact that I’m not going anywhere. Yet still, for that first client, you have to keep your head up with confidence as they never want to know they are in fact the first client. I’m telling this story not to ag- grandize myself but to prove the point that if you don’t come from a humble place, perhaps profitability isn’t the objective. There is a difference be- tween running a business and floating an idea – you must make a decision on which is your objective. A business Zamanian is the Legal Director of the EB-5 Advisory Department for The American Legal Center “THERE IS A DIFFERENCE BETWEEN RUNNING A BUSINESS AND FLOATING AN IDEA – YOU MUST MAKE A DECISION ON WHICH IS YOUR OBJECTIVE”28CEO MIDDLE EAST JANUARY 2024 COVER STORY | SHAI ZAMANIAN requires profitability at the expense of sacrifice. Lace up your boots, it’s worth the journey. The concept of “fake it till you make it” is thrown around in pop culture. If you’re sacrificing your short-term desires and dealing with the August heat, by no means is that faking it. How is The American Legal Center different from other immigration firms? So you’re at a dinner party and you’re introduced to a chap sitting next to you, his suit is tailored and speaks with pizazz. You ask the obligatory ques- tion, “So what do you do for a living?” And he tells you, he does it all. He’s entrenched in commercial develop- ment, sustainable farming, neverthe- less funding all of his projects through his cryptocurrency investments. Don’t be that person. Decide on how you bring value to the marketplace of ideas and laser focus on that. This is how you’ll ultimately make an impact – not by doing everything, but by doing one specific thing and committing to doing it well. At The American Legal Center, we stand out because we’re honed in on the US EB-5 Golden Visa program, guiding clients globally. If general im- migration is your game, Dubai’s heavy hitters like Arton Capital and Henley & Partners have you covered worldwide. But if your heart is set on the US, turn to the experts at The American Legal Center – we’re masters of the craft. What is the main motivation for your clients in signing up for the EB-5 program? Multigenerational planning, especially for the kids. Generally if a young en- trepreneur comes to see me who isn’t looking to study in the US and doesn’t have any concrete plans, I tend to wrap up the meeting quite quickly as I know this is not our client. But when I meet a family, I generally ask among my first questions, “How many kids do you have and what are their ages? Are they looking to study in the US?” The common thread among 90 percent of our clients is that they have a child with aspirations of studying and working in the US. Not the high- Zamanian is actively working with families to provide multi-generational planning through the USCIS EB-5 program Dos and don’ts for entrepreneurs DO • Bootstrap • Be a vanguard in marketing. Be the first in your industry to set up a pop-up shop, a seminar series, or a non-traditional marketing medium like TikTok • Speak out about your business. Do the podcast, people will listen. Just take that first step • Choose the right partnerships DON’T • Ignore red flags. They will be apparent with great shock and if you ignore them, it will for certain be at your peril, if not immediately in time • Assume history repeats itself • Worry about the competition. The world comprises about 8 billion people and there is business to go around for everybody. Commit to excellence and it will ring trueJANUARY 2024 CEO MIDDLE EAST 29 SHAI ZAMANIAN | COVER STORY est echelon of earners, generally the upper middle class. They know the cost of sending their son or daughter abroad for education, they undertake the program, in hopes of having the US government cover all education costs, including tuition, books, trans- portation, insurance, housing, etc. Tell us about your team at work Our group is steadily growing. We are interviewing frequently with hopes of starting more awareness campaigns in Russian, Arabian, and other secondary markets. We generally hire people that are laser focused on their life goals. For young interns, it’s so impor- tant to practice your elevator pitch. Be able to describe yourself and your life goals within 30 seconds. There will be people that can fulfil office jobs, we want the office to consist of leaders that grow together. Coming into a role at The American Legal Center, you have to be able to first explain what your life looks like in about 10 years. For example, my marketing manager has aspirations of owning her own marketing firm. I see no reason why I cannot partner up with my associ- ate in time to make that dream come to life and to profit with them. Their effort is never gone in vain. Any advice for those that feel trapped in their jobs? If you sense your salary will double one day doing the same tasks, you will look back perhaps in regret. If you’re waiting for a senior to leave the company or be fired so that you can take their spot, forget that notion as well. Be in a position to teach newer employees or interns your job, one of your goals is to pass on your knowl- edge and responsibilities to a more junior associate. When your duties are successfully passed down to a junior, you have no other place than to leave purgatory and elevate the ladder. Act with the mindset of cooperation and not from a place of fear of being replaced, it will ring true. Immigration in America today Trump’s stance on the issue of im- migration in America during the 2016 presidential election sparked concerns and became a dominant topic of discussion. Trump’s ‘Build the Wall’ campaign shed light on those illegally residing in the US and those on a temporary work visa (H-1B). While asked about this issue, Trump shared his thoughts saying, “We believe jobs must be offered to American work- ers first […] widespread abuse in our immigration system is allowing American workers of all backgrounds to be replaced by workers brought in from other countries to fill the same job for less pay. This will stop.” This created tension between well-known tech companies, such as Google and Amazon, who employ foreigners to work in specialty occupations under the H-1B visa and the policies of the US government. These companies have been criticised for exploiting for- eigners and contributing to the issue of immigration in America. The American Legal Center have successfully filed the most EB-5 applications within the GCC market, and has been established as the specialized leader in the region in regards to this program “WE STAND OUT BECAUSE WE’RE HONED IN ON THE US EB-5 GOLDEN VISA PROGRAMME”Next >