Egyptian Billionaire's Swiss Resort May Rival Verbier
An Egyptian billionaire with a penchant for risk is transforming a sleepy Swiss village into a ritzy resort that may one day rival Verbier.
Samih Sawiris’s Orascom Development Holding AG plans to spend about $1.5 billion in Andermatt to build deluxe hotels and a golf course on a former Nazi supply route. His plans will double the number of ski slopes and revitalize an Alpine town at the base of Gemsstock mountain between Milan and Zurich that lost a fifth of its residents in the past decade.
“I wasn’t euphoric at the beginning,” Internet cafe owner Baenz Simmen said of the developer’s proposal to expand Andermatt. Sawiris has a vision to convert the town, where Elvis Presley learned to ski, into “a little paradise,” he said.
The cheapest housing units in Sawiris’s project are on sale for 1.2 million Swiss francs ($1.1 million). The first apartments in the village along the scenic Glacier Express train route from Zermatt to St. Moritz will be ready in late 2013 or early 2014. Orascom expects most of the buyers to come from outside Switzerland.
Sawiris, 53, made his fortune developing towns in the Middle East. Now he’s betting that a revived Andermatt will compete for skiers with more well-known resorts such as Verbier, St. Moritz or Zermatt. He envisions a new town the size of 200 soccer fields with an 18-hole golf course, a sports center, 490 apartments and six luxury hotels that’s next to the old village of 1,350 residents.
“They all thought I was crazy,” Sawiris said during an interview in Andermatt. “But they thought the same thing when I decided to build El Gouna,” he said, referring to Orascom’s flagship resort on Egypt’s Red Sea coast.
Sawiris caught the attention of Zermatt Mayor Christoph Buergin when announcing the project.
“I know Andermatt very well and hearing someone coming from Cairo saying he’ll build a resort here, my first reaction was that he must be stupid,” Buergin said in a July 20 telephone interview. “But now I think it’s a very good thing. This is a man with plans.”
Andermatt is the most expensive new resort in the Swiss Alps, four times more costly than the investment Mirax Group is planning for the Le Village Royal project near Crans-Montana. The Russian developer owned by Sergei Polonsky is committing about 400 million francs to the resort, which includes hundreds of deluxe apartments, ski chalets and a hotel complex.
Qatari property developer Barwa Real Estate Co. is investing 300 million francs at Buergenstock above Lake Lucerne for a 400-room spa resort project that includes 60 residential suites with hotel services.
Sawiris’s resort will create 2,000 jobs for Andermatt, whose economy has relied for decades on the Swiss army. While Switzerland was neutral during World War II, Nazi trains used the transit route through the Gotthard mountain passage for supplies, the Andermatt Internet café owner Simmen said.
The mountains above Andermatt are fortress-like, peppered with bunkers and underground tunnels, part of an area central to the Swiss national defense strategy until the Cold War ended. After a series of cutbacks, Switzerland no longer needed its Alpine fortress -- or Andermatt.
That’s when Sawiris stepped in. He bought land vacated by the army and won local support in 2007 to build the resort, convincing residents the project will bring jobs and prosperity without harming the environment.
Andermatt by Coincidence
“Andermatt came by coincidence,” Sawiris said. “I was asked by a friend for advice on what to do. When I came to give advice, I fell in love with the idea of doing this in Switzerland. I told them if you give me the right conditions I’ll come, and they did.”
Simmen, whose Internet cafe is on Andermatt’s main street, was among the early skeptics. He changed his mind after the third of four meetings that Sawiris held with residents.
“Sawiris is very transparent and cares about nature,” Simmen said. “He’s not going to make this an urban thing.”
While the Ursern valley is a magnet for skiers, snowboarders and hikers, Andermatt has offered little indoor entertainment until the emergence of the project, Simmen said.
“If there’s bad weather in Andermatt, you have to be a reading person or a drinking person because otherwise there’s nothing to do,” he said.
Hotelier Kevin Obschlager is upbeat about the new business the project will draw to Andermatt, though he doesn’t believe local residents grasp how big an impact the resort will have.
“When they roll in, they’ll rule because money rules,” Obschlager said of property buyers. Now is the time to figure out how best to cope with changes Sawiris’s resort will bring and to work out a strategy to ensure the old and new are compatible, he said. “Time is our capital right now.”