real estate mogul rubbing shoulders with Trump

When Emirati billionaire Hussein Sajwani mentioned to his longtime business partner Donald Trump over dinner that he planned to expand into US data centers, the president-elect sensed an opportunity.

“He said, ‘I have a press conference in a few days, and I want to announce it,'” Sajwani told the Financial Times in an interview last week at his villa on Dubai’s man-made Palms — a symbol of entrepreneurial extravagance. And its appeal from footballers to ex-warlords to global millionaires.

The world’s most powerful man described Sajwani as a “great investor” at a Mar-a-Lago press conference this month, as the pair stood side by side to announce a planned $20 billion investment. It has put a global spotlight on the Emirati entrepreneur, who started in food services and built the Middle East’s glittering commercial hub through his company Damac, Dubai’s largest private residential developer.

The plan to spend $20 billion over four years seems ambitious. Sajwani’s data center company Edgnex is yet to sign a deal with a tenant for its planned 2000MW US data center. Founded in 2021, the company has close to 15MW operational data centers in Saudi Arabia and Thailand. The investment would be a big one for Damac, which had $5 billion in cash on its balance sheet as of June last year.

Sajwani said he expected to rely mainly on bank loans to finance the plan, adding that the $20 billion figure was estimated from “how much we can take from management time, land acquisition and our own capacity on our own balance sheet”.

Sometimes called “Dubai’s Donald”, Sajwani is regarded as an outsider by the city’s business community. Belonging to the minority Shia Muslim community, he is seen as a hard-charging risk-taker who has caught on to the rollercoaster of Dubai’s boom-and-bust property market. “Old [Dubai] Families don’t really like him,” said a Dubai-based executive who has worked with Sajwani.

Instead, the real estate mogul found a US ally. Sajwani and Trump have known each other since 2011 when Damac and the Trump Organization built the first Trump-branded golf course in the Middle East.

Plans for a second, Tiger Woods-designed links in Dubai have been established, Sajwani said, although the project remains on the Trump Organization’s website. Even so, the families remain connected: Trump’s sons attended Sajwani’s daughter’s wedding, and Sajwani said their wives have become friends.

The Emirati tycoon has ties elsewhere in Trump’s inner circle. He has invested in Elon Musk’s SpaceX and XAI. The 72-year-old was pictured alongside both men at Trump’s New Year’s Eve bash.

Since the Dubai Trump International Golf Course, the Trump Organization has marketed its name for development with other partners in the region: a resort is under construction in Oman, while two towers – one in Saudi Arabia’s second city Jeddah and another in Dubai – are planned.

Those Middle Eastern business ties have raised questions about potential conflicts of interest for the president-elect, even though he has stepped down from the Trump Organization.

Trump’s sons, who run the conglomerate, hope to capitalize on strong post-Covid economic growth in the autocratic, hydrocarbon-rich Gulf region. “If you’re a developer, Dubai is almost a playground for you,” Eric Trump said in an FT interview last year, calling the region’s growth “explosive.”

Dubai’s latest boom has boosted Damak sales. Revenue for the six months to June 2024, the latest Damac Real Estate accounts available, hit $1.4 billion, more than double the $690 million for the same period a year earlier. Profit before tax rose to $456 million from $297 million.

The soft-spoken Sajwani, whose net worth Forbes puts at $5 billion, is the son of a market trader and door-to-door salesman. Local traders recall its first venture as a fast-food outlet in a mall in the 1980s. Sajwani then started an industrial catering company and bought land and property in Dubai as it established itself as a regional center in the 1990s. He founded Damac in 2002.

The company narrowly escaped the 2008 global financial crisis and the bursting of Dubai’s property bubble. “We were struggling to pay,” Sejwani recalls. “I went to the bank in November 2008 and told them all that I was in a very bad situation”. He said bankers restructured his loans while negotiating with landowners and customers.

“The man has nine lives,” says a Dubai-based international banker. “He’s come close to hitting many times”.

The company has promoted its buildings from China to India in an attempt to attract new buyers in Dubai’s volatile property market. But its reputation has suffered due to its association with shoddy construction work. “We had a challenge in 2011 and 2010,” Sejwani said. “We have launched some products [ . . .] in a moderate position. And we sold them very cheaply.” He emphasized that the quality matched the price but admitted that buyers expected better.

“Were we perfect? no There were buildings that, I agree, we could have done better,” admitted Sezwani. “We have learned our lesson. . . If you look at our buildings, which have been recently delivered in the last few years, I don’t think we have had quality issues”.

Privately owned DAMAC’s brash marketing tactics have shaken up a property market dominated by state-backed developers such as Nakheel and Emer. Besides complimentary flights to Dubai for potential investors, Damac promised apartment buyers free luxury cars.

Such was the publicity Criticized as “immoral”. In 2014 by Mohamed Albar, rival Emma Chair. But Sajwani called the gift “the best and greatest idea”.

DAMAC has expanded beyond Dubai with projects from Miami to the Maldives. However, Sajwani’s foreign adventures initially proved difficult: a 2006 purchase of land in Egypt ended in a legal battle with the state after dictator Hosni Mubarak was ousted in 2011. Sajwani was sentenced in absentia to five years in prison on corruption charges in 2011, although Egypt’s prosecutor-general later suspended the sentence. Sajwani said the trial was politically motivated.

“After that, I stopped investing in countries where you have challenges,” Sajwani said.

Entrepreneurs don’t always endear themselves to outside investors. In 2022 he delisted Damac’s shares from the Dubai Stock Exchange, regaining full control. Some investors complained that they funded the company through market volatility and were being kicked out as the share price moved in their favor.

Sajwani denied he had timed the deal to reap the rewards and said market “speculators” had prompted the decision: “We didn’t see that going public was benefiting us. We were getting a lot of negativity from speculators.”

The US data center is its latest risky bet. Edgnex said it initially plans to form joint ventures with established players or potentially buy existing facilities and land ready for development. Even so, analysts say the US capacity target of 2000 megawatts will be difficult to reach in such a crowded market.

“Once you’ve found capacity, as a developer, especially someone new to the space, the challenge is finding a place in line to get all the tools you need,” said Pat Lynch, head of data centers at real estate advisor CBRE. The solution team.

“Often the biggest developers and hyperscale [tech] Companies have bought their way in line for several years.”

One industry executive said even the $20 billion investment is unlikely to make a mark: “It’s almost a sneeze in terms of data centers.”

Doubters are unlikely to bother Sezwani. Like his presidential business partner, Sajwani insists that his critics are uncomfortable with his role as a disruptor: “People will tell you, ‘Hussein Sajwani . . . He is a tough man.’ What successful people are easy?”