Friday, August 5, 2011
Iran, construction galore!
by Amir Taheri
Unusual would be NOT to see a construction site somewhere near you when you are in Iran. It doesn't matter if its next to your house that a new apartment block is going up or at work where a new office is raising with its massive columns or some new mall popping up on your way to work. The skyline of most cities is covered with cranes, most road networks are littered with expansion projects, and projects compete with each other to be the "biggest". It is not uncommon for 2-3 similar projects nation-wide claiming to be the "biggest" of what they offer.
As Iran grows both economically and in population new structures to support their needs is a natural occurrence. Such has been the rapid population expansion that in the last 20 years or so, the culture (outside of Tehran) of home owning has shifted to apartment owning. Today, owning a house in town is almost seen as a luxury and prices reflect that reality. As such expansion has occurred, there has been an interesting effect, migration of "dahaties" or villagers into towns. With the land prices explosion that started a few years ago, a nouveau riche class has been created in Iran. These dahaties have sold their lands or homes and moved into nearby cities with their money but lacking of an understanding of the modern world as we know it or the education that at times accompanies such wealth. This money influx has also aided the further massive building of Iran's cities.
In Iran there is a mixture of public works that focus on roads, highways, metros, dams, and mass housing that crisscross with the private sector that dominates the construction industry (quotes of up to 95%) of homes and business buildings. As limited space within cities have been overcrowd with people and cars, there is a movement to the creation of suburbs. In a very short time, an entire suburb or "new city" goes up near a major metropolis. Each major city has one of these now Tehran, Tabriz, Shiraz, etc. Parand, near Tehran, for example one of these new towns, has a population approaching 100,000 people. Shiraz also has Sadra City. This suburb is the focal point of most of Shiraz's largest projects. It boasts a recently started and under construction medical city catering to foreign medical tourists. Iran's and the Middle East's largest water park. A bird park is being developed that, when I asked at a recent tourism convention of what is so special and large with this park that the answer quickly satisfied me. The friendly spokesman informed me that artificial environments will be developed for the birds that will simulate their migration over time. The birds that live within the environment will simply migrate to a new part of the park where other weather conditions will be simulated for them. In one months time, a jewel in the Shiraz suburbs construction plans will be inaugurated, the Persian Gulf Shopping Complex. This complex, said to be largest mall in the world for number of shops, 2,500, is being built with both foreign and local investors with a sum of over $840 million. Tehran is also getting two mega malls, one built by Malaysian investors with over $500 million and one by the daughter of Turkey's former President. This project also reported in the sums of hundreds of millions dollars, will be around 35 stories.
Another aspect of this massive construction wave started a few years back with an initiative by President Ahmadinejad is the Mehr housing project. This is an interesting endeavor as it aims to provide housing opportunity to all Iranians. It offers government lands to builders that build on a massive scale targeted for those not yet owning their own residents. The individual "owns" the property for a total of 99 years and afterwards it reverts back to government control. What makes the program so appealing is that the person entering this agreement gets an apartment for as low $16,000 and can even use a low interest government backed loan for this sum. The program is fast approaching its target of 1.5 million homes. This again is an offering across Iran and near every major Iranian city.
Each region of Iran also has its own reason to massively invest in its expansion. Shiraz serves as the number one local vacation spot with this ancient Persian sites and has its peak of visits during the Persian new years, which easily doubles or triples the population of this city. One after another, new hotel complexes are being launched here. Mashhad, the resting place of Imam Reza, one of the 12 Saints of Shiite Islam, draws more than 20 million pilgrims a year, a sum even more than Mecca! With this number of visitors a year, hotels, shopping malls, and eateries must exist to support them. Who would have thought that one of the best shopping experiences in Iran could be in such a holy city. Mashhad's airport is second only to Tehran's domestic airport, even busier than the Imam Khomeini Airport in Tehran. Many international flights also land at Mashhad bringing pilgrims. A high-speed train is in the works from Tehran to Mashhad, reducing the burden on roads and airports. Tabriz serves an industrial base for many heavy industries, like tractor, bus, and manufacturing to name a few. The close proximity to Turkey also serves to further the trade relations and even further construction. Turkish investments have come in the form of petrochemical plants being built and recently a takeover, relaunch, and expansion of a fabric plant.
Government infrastructure projects are also abundant. Just in the last week, Iran's largest cement dam built domestically was inaugurated, this after Japan had pulled out of the project years ago under US pressure. Also last week, Iran's largest cable bridge was opened in Ahwas. I have mentioned before that almost every major city in Iran is set to getting a metro system. It is said that Iran boast the highest number of underground projects in the world, a mixture of metros, tunnels, and underground complexes built by the defense ministry. It was made easier with the localization of technology that digs underground. A monorail line is under construction in Qom and it will serve as a test bed for a future Tehran monorail system. Around $13 billion of new rail projects were signed with China a few months ago. Savings from the subsidy program, estimated around $60 billion are planned to be injected back into further infrastructure projects. I challenge you to try to look around or take a picture in Iran without at least 1-2 sites being in your view!
Editor’s Note: Amir Taheri is one of the authors of Uskowi on Iran. His weekly columns appear here on Fridays.