How 2 U.S. Entrepreneurs Cracked The Moroccan Property Market
It’s slow progress at best, strolling through the Fez medina with David Kellar and Brian Smith.
The heavily laden donkeys don’t help. Nor do the boys playing pickup soccer games, or the shopkeepers who spread their wares in the cobbled alleys of the medieval walled city.
But what slows you down the most is that Kellar and Smith seem to know everyone. Just a few minutes into our walk, they’ve already greeted half-a-dozen merchants, their banker, and one of their property managers. Each encounter requires hearty exchanges in Arabic and in some cases kisses planted on the other man’s cheek, in true Moroccan style. It may not look like it, but the pair are hard at work.
“Fes Properties,” says Kellar, “wouldn’t work without our having the local language – and local relationships.”
It’s a clichй to say that business hinges on relationships, but they’re priceless in the Arab world, particularly in close-knit communities such as the Fez medina. So it’s all the more remarkable that Smith, 32, a burly, blue-eyed business graduate from Nebraska, and Kellar, 35, a former actuary from North Carolina, have penetrated the medina’s byzantine property market.
Fes Properties (“Fes” is an alternate spelling of “Fez”), the medina’s first foreign-owned real estate firm, specializes in selling and renting traditional Fez townhouses, or riads, to American and European clients. Before the duo started the business three years ago, the local property market was dominated by local brokers. Their designation, simsar, means “agents of poison” in Fez dialect.
As the name suggests, real estate brokers are viewed with disdain in Fez: Professional training is nonexistent, and trade ethics vary widely. Barriers to entry are low: Simsars range from well-established agents to the local vegetable seller with a tip that a widower on his street wants to sell.
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Foreigners shopping for property frequently meet nasty surprises: Morocco must be one of the few markets on the planet where sellers tend to bargain up, starting with low sell prices that they increase as negotiations proceed.
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