Over a few months, the Lebanese have lost their trust in local banks. Generated mainly by these lenders' restrictive policies, this distrust has caused the stakes of banks to plummet and share the same fate of most Lebanese companies. Amidst the chaos, only one major company is swimming against the powerful current of economic collapse: Solidere.
Since it became clear for the people of Lebanon that their state's economy was heading for the worst, they've been in a state of panic over what to do with their money — if they could get a hold of them, that is.
Today, it's become a troublesome chore for a bank depositor in Lebanon to withdraw some of their dollar bills from their account; it involves rushing to the bank early in the morning before other stampeding people drain its daily dollar supply.
And it's no secret to anyone that, despite the recurring assurances, many banks have edged close to collapsing since last October. Dollar deposits are in constant danger of being converted into Lebanese pounds and capital controls are scaring away people and their money.
In short, Lebanese banks are not anymore a haven for the citizen's green paper. With that in mind, Lebanese depositors and investors have begun looking for alternatives over the past few stressful months. And that's where Solidere comes in.
Because the company trades in dollars and specializes in real estate, which is considered a more stable form of investment, it's where many Lebanese investors have decided to park their money. That is, at least until the economic situation improves.
The ongoing heavy migration of cash from banks to real estate has boosted Solidere's main shares by around 46% since last October, as reported by Bloomberg.
Solidere, which has been in charge of reconstructing Central Beirut following the end of the civil war in 1990, currently has a market value of $1.4 billion as a result of this climb; more than any other company in Lebanon.
This spike in the shares of the late Prime Minister Rafic Hariri's company comes in a time when Lebanon's BLOM Stock Index faced a 21% decline and was ranked among the worst-performing in the world last year.
In other words, while the majority of Lebanese companies' stocks are suffering, those of Solidere are skyrocketing.
And after suffering a $100 million loss in 2018, Solidere recently regained momentum and compensated, all thanks to the instability and chaos that's enveloped the country.
Even if temporarily, Lebanese investors in Solidere and real estate feel that their money is in a safe place until everything is back on track; until who knows when.