Mac McClenahan is the creator and owner of the upscale hybrid hotel/hostel Hamra Urban Gardens. He sat down with MET&T in Beirut to talk about what inspired him to get into the hospitality business in Lebanon, the costs and challenges involved in renovating and repurposing older buildings, and what it’s like for investors to deal with the country’s multi-layered bureaucracy.
Interview by John Navarre, Editor-in-Chief, Middle East Travel and Tourism (MET&T)
MET&T: Mac, let’s start by learning a little about you as the owner and creator of Hamra Urban Gardens. Can you give us some background about where you’re from and what brought you to Lebanon?
Mac McClenahan: I’m an American. I grew up in San Francisco and Colorado, but I lived here in Lebanon for 16 years now. I started my time here as a student at the American University in Beirut, and that’s basically how I got here. Then one thing led to another, I got married here, and then I began starting businesses here.
MET&T: Was your first business here in Lebanon in the hospitality industry, or did you gradually get into this sector?
Mac McClenahan: The first project I did was an NGO. But after that, I started an Arabic language school. Then I got into hospitality. That’s when I started the first hotel property in Gemmayze, Saifi Urban Gardens, which was more of a hostel. That was in 2010. The second property, Hamra Urban Gardens, opened in 2016.
MET&T: Why did you decide to move into the hotels business? Was it a dream of yours to renovate buildings and turn them into trendy hotels?
Mac McClenahan: It wasn’t even a dream. It was just an accident. I studied physics and sociology and had nothing to do with this. I designed a house when I was about 25 years old, so you could say that that’s when I began getting into architecture.
When I started renovating places, I just learned on the spot. I never use designers or architects. I do all of it myself by hand. I’ve worked with the same guys more or less for the last 12 years. The guys who still do the electricity, plumbing, painting, and everything like that are more or less the same team that I started with.
I like to get ideas from them on materials and how to build things, and we put it all together in a way that very Lebanese in the sense that it’s created out of local materials by local people. I try not to bring in any furniture that looks like it was made outside. We build everything here – the tables, the bars, and even the chairs. Everything you see is all stuff that we built here.
MET&T: How extensive were the renovations required to turn these two properties into the trendy boutique hotels they are today?
Mac McClenahan: Both of them were huge renovation projects, but the one in Gemmayze was much more work. It was two residential buildings and a garden. Those buildings were in complete disrepair there, and nobody had been using them for about 20 years.
I renovated that first property in a very simple way. It’s more of a hostel, and the restaurant and cafe are a big part of it. And there’s also a rooftop bar that’s an important part of it too. We actually expanded that property about a few years ago where we doubled the size of the restaurant. So that first location in Gemmayze was a bigger project than the second one here in Hamra in terms of how much work had to be done.
The building that is now Hamra Urban Gardens was originally built as a hotel in the 1970s, but it was never completed. Basically, there were no windows or doors and only some of the plumbing was in, but more or less it was just a concrete shell. That’s what we started with here in Hamra, and then we put it all together into what it is now.
MET&T: What’s the range of investment that was required to turn a dilapidated or neglected property like the ones you found here into a functioning hotel like Hamra Urban Gardens, or in the case of the Gemmayze property, a hostel?
Mac McClenahan: Hamra Urban Gardens cost close to $3 million, and the hostel in Gemmayze was more like $1 million.
MET&T: What originally gave you the idea to specifically open a hostel first?
Mac McClenahan: During that time, I was also running the Arabic school. We had a lot of students who were coming and it was hard to find a place for them to stay. Back then, in 2007, 2008, and 2009, there were no decent hostels or dormitories in Beirut. Most people ended up trying to find apartments. But in order to do that, you needed to know people or to have lived here before. There wasn’t a very good online marketplace either.
So, I just saw that as an opportunity, and it fit well with Arabic school. But the market has grown a lot since then. We have a lot of tourists who come for just a few days. There are also a lot of Lebanese who come back from abroad, and there are many business people who come here too. The market has diversified, and it’s the budget and mid-range part of that market which was my target.
MET&T: And what about this property? What made you decide to start expanding your portfolio, and why did you decide to make Hamra Urban Gardens a bit different than the first one?
Mac McClenahan: When I started this project in Hamra, it was in 2015 and that was really a time of growth in tourism here. But Hamra wasn’t like Gemmayze, where there really wasn’t any competition at that level and price. Here in Hamra, there’s a lot of competition in the $60-100 a night range, but most of the hotels are old.
This is also an old hotel too, but the way we styled it and the way that it’s designed doesn’t have that old 70s feel. Our receptionists don’t wear tuxedos and sit in dusty rooms with lots of wood. Most of these mid- to low-range hotels in Hamra have that feel. That’s why I wanted to open here – because I felt there’s room in the market for a place that’s a bit more modern and in the style that I like to do.
Tourism was growing well then too. The restaurant was super popular, and I knew that there were also a lot of people on the other side of town in here Hamra who would like it too and that it also would work well here. Then the pool on the the roof is just a bonus.
MET&T: Was the pool was already here when the original structure was built?
Mac McClenahan: Yes, but it was never completed. It was just a shell. What’s interesting is that this hotel was occupied by militias during the civil war, so the pool was used for water storage during that time, but it had all these bomb craters. It has some history. But the pool here is a lot of fun. It’s really nice and it’s super popular in the summer.
MET&T: One of the interesting features of Hamra Urban Gardens is that it’s a blend of both a hotel, with very nice private rooms on some floors, and on other floors there are shared rooms like a classic hostel. So the mix of guests is always youthful and vibrant and energetic. Did you decide to create that blend based on your experience looking at other hotel properties that had successfully done that in other countries, or did you come up with the idea to do that yourself?
Mac McClenahan: That was just my idea. I spent a lot of years traveling in my 20s staying in a lot of hostels and cheap hotels. But it wasn’t like I knew of a place or I saw a place somewhere else and I wanted to copy it. It didn’t even exist. It grew out of my experience the first property in Gemmayze.
I initially imagined it like a peer hostel with mostly all shared bedrooms and maybe just one or two individual rooms. Then it turned out that the demand was more for the private rooms, so we made more of those. That’s how the concept evolved.
When I began building Hamra Urban Gardens, I wanted to keep the dorms. I wasn’t really sure about the market for it, but for me it makes the place unique. It gives the vibe of more of a community type place. People are interacting more with each other when there are shared accommodations. It has that feel and it’s less formal.
To me, it was important to keep the atmosphere informal. It works against us in some ways, but it’s a legacy thing. A lot of the online travel agencies such as Trip Advisor and Booking.com are not sure how to classify us. Are we a hostel or a hotel? So, we end up getting classified as a hostel quite often because some of the floors have shared rooms.
They’re like, you can’t be a hotel if you have shared rooms. But I’m like, well, we kind of are a hotel too. But if that’s your rule, then fine. The idea is new, so from afar it’s hard to understand. And it’s hard for these big online booking websites to understand too. But when people come here, they understand the concept and how it works smoothly to create a great experience.
MET&T: Do you get more of your bookings from those big online booking sites or directly from your own website?
Mac McClenahan: I’d say we probably get half of our bookings from online travel agencies and half directly through our website. To tell you the truth, I used to resist the online booking sites for years and years because I didn’t want to pay the commission. We didn’t start using those until 2017. But we work hard on our website. I have an IT team that builds sites to handle bookings, and we’ve been doing that since 2010.
MET&T: How easy or difficult was the process of dealing with the government bureaucracy here in terms of getting permits and permissions to operate a hotel business?
Mac McClenahan: It’s horrible. It’s ridiculous. In Gemmayze, we just got our hotel permit. They don’t have a hostel permit, which is what it should be, but they don’t have that here. It just doesn’t exist. So I just got the hotel registration a year ago, but we applied for nine years ago. So it took nine years to finish.
Here at Hamra Urban Gardens, we learned that the process would be easier because this property was originally built as a hotel. From a standards point of view, it’s easier for the regulators to understand, but it’s still a pain.
Construction is a pain to do too because it’s basically impossible to get a permit to do renovations on a large scale. You can still operate while you’re waiting on the permit, but 90% of all places never even get the permit.
MET&T: Is there any sort of recognition among the regulating authorities that the bureaucratic burden they place on hospitality industry investors and business owners like you is a hindrance to their tourism-building goals, or is there just no strategic level coordination here at that level in the tourism sector?
Mac McClenahan: I don’t think they see it like that. The Ministry of Tourism has two halves to it. One half is interested in promoting tourism. As far as I can tell, their main activity is doing advertising campaigns. They have very little to do with actual situation here in the country.
The other side is the regulatory side, which is not just for hotels. They regulate all the restaurants and bars too. They all need permits from the Ministry of Tourism too, in addition to hotels, tour operators, travel agencies, etc. And it’s the side, the regulatory side, that basically makes it as hard as possible to register new business. There’s definitely no sense of streamlining.
But it’s not only the Ministry of Tourism that’s involved. That’s just one part of it. Then you also have the city authorities. When you open a restaurant or a bar in a building that’s old, it often doesn’t fit within the framework of existing regulations for that building. It’s really hard to make everything fit legally. Whereas, if you’re in a newer building, it’s usually less of a problem.
A lot of the old buildings here were originally residential buildings, and changing them from residential to commercial is very hard. That’s part of what took us so long in Gemmayze – five years for that, tons of money, and it’s not a simple process.
One of the main things in Lebanon is that a lot of the buildings here have character and there’s tradition behind them, and that’s part of the charm of the country. But there’s a big pressure from the municipality not to utilize those buildings legally to their full extent.
If they want to preserve those buildings, it has to be done in a way that’s commercially viable because a lot of them are worth way too much to just use their residential permitting to turn them into apartments and rent them out as affordable residential places.
MET&T: Do you have plans for expansion for other properties either in Beirut or elsewhere in Lebanon or even outside of Lebanon?
Mac McClenahan: As of right now, I don’t know. The situation here is not a good investment until things get back to normal. In the future, maybe Syria would be a place I would look and perhaps get an old house in Damascus and turn it into something. There’s been been a big trend lately towards converting villas and creating guest houses, which I think is really nice and healthy. Or maybe I would open something in one of the villages up in the mountains. I’d love to do that, although I’ve always been hesitant on this because it’s very seasonal.
