Luxury villa developments in Morocco are attracting wealthy footballers in droves. But does that make them a sound investment for the rest of us? Belinda Archer finds out
Buying right at the start of a country's property boom carries risks. But star footballer Rio Ferdinand probably doesn't need to worry too much about any potential collapse in value. The Manchester United and England football international has bought a £500,000 deluxe, five-bedroom villa in the traditional riad style in Le Jardin de Fleur, one of Morocco's most luxurious resorts on the Mediterranean coast, and he has bought it off-plan.
The potential risk of an investment in an unfinished complex in an untried market is perhaps less pertinent if you earn half a million pounds every few weeks—and Ferdinand has also purchased three additional townhouses for friends and family. His footballing chums John Terry, the Chelsea captain, and Manchester United team-mate Gary Neville have bought similar properties. As well as a luxury villa at a knock-down price, the players get exclusive access to a fleet of Oceanis 46 sailing yachts, five-star facilities within Saidia—a new flagship resort dubbed "Africa's St Tropez", designed to attract some £31bn in foreign investment—plus a fancy "Bedouin-style" beach club.
But Ferdinand claims his Moroccan property is not just about the money. "I love everything about Morocco, the people, the food, the beaches," he says. "Our villas are not just investments—we will use them for holidays."
But even for mere mortals, Morocco is increasingly becoming a favoured destination for investment and lifestyle purchases at all price levels. The kingdom, which offers a taste of Africa on the edge of Europe (it is only 14km from Spain at the nearest point), is just three hours by air from the UK and is in the same time zone. It also has an average annual temperature of 21°C and an unusual blend of endless sandy beaches, the snow-capped Atlas mountains, the vast expanses of the Sahara and the bustling souks and ancient medinas of Marrakesh and Fez.
Access is getting easier too. No-frills carriers EasyJet, Thomsonfly, Ryanair and Royal Air Maroc's low-cost subsidiary Atlas-blue between them cover Marrakesh, Agadir, Fez and the main business hub of Casablanca.
Of course, there is no guarantee of cheap flights in the future to any of the new destinations that have sprung up on the airlines' itineraries. Falling profits have forced the budget airlines to discontinue unprofitable routes, but there are alternatives. You could drive and catch a ferry or high-speed catamaran from the Spanish coast. A bullet train is also planned, which will link the coast at Tangiers with Marrakesh by 2010.
But, crucially, Morocco also offers a low cost of living, and this is another reason why it is being positioned as a candidate for a property boom. Youssef Benamour, managing director for North Africa at estate agent Hamptons International, which has just opened an office in the economic capital of Casablanca, comments: "Hamptons has opened here for a reason: Morocco is really taking off. It is ideally situated less than three hours from many European destinations, with sunshine all year round and 3,000km of sandy beaches. And prices are low. They are almost half those in other parts of Europe. And it has a strong culture and sense of identity."
What is creating a particular buzz is the forward-thinking approach of Mohammed VI, its king, who is keen to turn the nation into a major global force, modelling itself on Dubai in terms of a revitalised economy and tourism industry. His ambitious Vision 2010 development scheme, unveiled in 2001, aims to boost the number of annual tourist visitors to 10 million by the year 2010 and to introduce high residential growth to the country via investment in airport infrastructure, railways, and a property development master plan called Plan Azur, which incorporates six new seaside resorts.
John Busby, marketing manager at Pierre et Vacances, a major provider of tourism residences in Europe that has also just moved into the market, comments that the stability and modernisation are attracting more investment. "This has increased the potential for capital gains."
The unique culture is another reason why Morocco appeals to buyers. Leaonne Hall, author of a new guide, Buying a Property in Morocco, published by How To Books, adds: "Increasingly people are looking for cultural holiday homes and a taste of the exotic, which Morocco has in abundance. It is a colourful, welcoming place that really excites the senses."
Property divides broadly between the spanking new coastal resorts that tend to come with their own golf developments, the historic properties in the cultural capital of Marrakesh and the other imperial cities of Fez and Rabat, and the new developments outside the cities, where riad-style units are springing up offering all the conveniences of a modern development. There are more than 20 resorts being planned 10-20 minutes outside Marrakesh alone, including the high-end Izuran development, being sold exclusively through Hamptons, and Pierre et Vacances's middle-market, family resort of Domaine Azurak.
The coastal offerings currently embrace five resorts on the Atlantic coast and one on the Mediterranean. The scale of development is colossal, embracing 50 new luxury hotels, marinas, golf courses and commercial centres all dressed with thousands of residential units.
There is not much to see yet, though. A recent trip to Marrakesh, the focus of most of the frenzied development, revealed hundreds of developers' boards promising "five-star golf hotels" and "luxury properties" with acres of unbroken ground.
"The majority of property has yet to be built," admits Benamour. "Just the tip of the iceberg is on view at the moment. There are thousands of properties coming onto the market in the next two to three years."
Partly because of this, property is currently retailing at around one-third of Spanish levels, and that is despite being just a few kilometres over the water from the Costa del Sol. Prices range from £70,000 for a studio apartment to £150,000 for a riad to renovate and £1.5m for five-bedroom villas in the more high-end developments. This all compares favourably with parts of the Eastern European market, France and Italy, as well as Spain.
Observers claim prices within Morocco will also continue to grow as 2010 and the completion of Plan Azur edge ever closer. "The country has experienced price appreciation rates of between 10 per cent and 50 per cent over the last 12 months, and 280 per cent since 2001," says Hall.
But can this fevered development be good news? Is it being controlled sufficiently? Some critics have commented on how the upsurge could result in a rash of developments consisting of anonymous boxes. They could be isolated and uniform and might not reflect the country's true culture.
Jamie Moralee, the former Crystal Palace footballer who now runs New Era Wealth Management, a company that advises sports stars on property investment, says: "Rio [Ferdinand] loves the whole Morocco vibe, and although this is a new resort he is buying in, it is very much being built to a Moroccan theme, with souks and medinas and Moroccan-style restaurants."
Buyers will have to wait and see whether there is anything authentically Moroccan about these new resorts. Many of them claim to incorporate elements of the local culture into their designs. One way of ensuring this is to hire a local firm of architects, such as the reknowned Elie Mouyal.
Mouyal uses old building techniques, modelling the units on the traditional riads and has adopted techniques such as earth constructions and painting the buildings to conform with the famous salmon-pink walls of Marrakesh, to assist in making the new buildings blend in more easily with the old.
Andy Welland, managing director of Gem Estates, an estate agent involved in a number of local properties, adds: "In Marrakesh there is absolutely a Moroccan feel. The riad properties are cookie cut from the ancient walled city and feature courtyards, loggias, ramparts, salmon-coloured wash, even on-site hammams [bath-houses]. Outside the city, the majority of the projects have a good Moroccan feel to them and most developments have strict designs to incorporate many traditional features."
At the same time, the Moroccan government has laid down strict regulations, demanding high-quality work, outlawing high-rises and imposing low-density ratios of buildings to land. The nation seems to want to ensure that its unique culture and diverse traditions continue to thrive. "Morocco will not be developed like Spain," says Benamour. "You won't see anything like Benidorm or the constructions of Dubai there."
While Spain and other European countries remain primarily beach-led, Morocco is also a cultural destination targeting a higher-end clientele. It is, not to put too fine a point on it, posher. "Future developments are likely to be positioned towards the luxury end of the market," agrees Benamour. Others reinforce this message, saying Morocco is a chic destination with chic developments to match. "The majority of people want golf. They want luxury and facilities and to be by the coast," concludes Welland.
Those who are buying now will hope that when the extraordinarily ambitious plans for 2010 take shape, prices will soar. In the meantime, you could choose worse neighbours for a kickabout.
Buying in Morocco
• A very low cost of living.
• The young market, although quite risky, means there is the potential for large returns as the market grows.
• Although only a short flight away from the UK, the country offers an incredibly rich cultural environment, with everything from exotic scenery to bustling souks.
• There are plenty of properties being built, so finding one to suit your budget and needs should be fairly easy.
• There is no inheritance tax and no tax on rental income for the first five years of ownership
• Very different culture and approach. Make sure you take local advice and listen to local experts. As with any investment, avoid unecessary risks.
• It is still very early in the property cycle. There is no way of knowing how the market will develop over the coming years.