FT | Saturday June 22 / Sunday June 23 2013WEEKEND

P r o p e r t y • I n t e r i o r s • A r c h i t e c t u r e • G a r d e n s

House^HomeForget BabylonWhere was theHanging Garden?Robin Lane Fox Page 16

Ana AlbanEcuador’s ambassadoron Julian AssangeAt home Page 2

It’s only 9am but it’s already 33Con the Malecón, Havana’s cor-niche, and my brain feels like aconch fritter. I’ve come to meeta man who we will call Rafael –

because that’s his name. But that’sthe only part of his name he is pre-pared to reveal. Rafael is an estateagent but he does not want anyone toknow it. “Being an estate agent is ille-gal here,” he says.

Rafael, 44, wants to show me a pent-house for sale. He says it is worth$2.5m but no one, not even he, reallyknows the right price because no onehas bought or sold houses here for 54years. “The market changes wildlyevery day. It’s emotional,” he smiles.

If we do agree a price, Rafael willadvise me not to buy the penthouse inthe normal way. Instead, to avoidtax, I should pay him a nominalamount locally, say 20 per cent, and

The country is finally allowing its people tobuy and sell homes – but property agentsand lawyers are still illegal. By John Arlidge Andrew Macdonald of Esencia, who wants to build Cuba’s first golf course since the revolution Photographs: Mark Read

property assets that have been frozenin place and time, unvalued or under-valued, are now up for grabs.

Raúl Castro’s move is the latest –and boldest – step in a slow economicliberalisation programme designed togenerate economic growth. Cubadesperately needs new sources ofrevenue. It is only kept afloat thanksto cheap oil, and other subsidies worth$5bn a year from its ideological ally,Venezuela. The subsidy deal wasagreed by Fidel Castro and formerVenezuelan president Hugo Chávez,who died in March. If Venezuela’s newpresident, Nicolás Maduro, renegoti-ates the agreement – and many ana-lysts say that, with Venezuela’s econ-omy slumping, he has no choice –Cuba will grind to a halt.

After half a century in which theycould only swap houses in a creaky,bureaucratic and often corrupt state-

run process known as permuta(exchange), which involved findingtwo properties of roughly equal valueand then getting state approval totransfer the title, Cubans are relishingtheir new-found economic freedom.

First-in-a-lifetime buyer GuillermoRey stands next to the scruffy porticoof a four-bedroom, three-bathroomhouse in Vedado, Havana’s most high-end, fashionable district. The price,says the owner Rosa Marin, is 350,000CUC, or convertible pesos, Cuba’s hardcurrency, which is roughly equivalentin value to the US dollar. She is sellingbecause she wants to move into asmaller property “and buy my daugh-ter a car, a good one, a Lada”.

It is a scene repeated all overHavana. The market is growing sofast that queues form outside the tum-bledown offices of Cubisima, aHavana-based property sales website.“Every day we get more people look-ing to sell and more people looking tobuy,” Mayelin Aguilar tells me as shekeys the latest listings into her bulky

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“deposit the rest in an account inSpain, please”. I must not talk aboutthe true price because, under newlaws, anyone caught lying about theprice of property goes to prison. Also,I must not reveal the name of thelawyer who does the paperworkbecause working as a private propertylawyer is illegal.

Undercover estate agents? A legalsystem that is illegal? Jail for lyingabout house prices – which everyonethe world over does? Welcome to theoddest property market in the world.Welcome to Cuba.

Half a century after Fidel Castro’sgovernment expropriated all privateproperty, the sunshine socialist stateis up for sale – in part. Raúl Castro,who took over as president from hisailing brother in 2008, has introducednew laws that allow Cubans to buyand sell homes. Billions of dollars in

I must not talk aboutthe true price becauseanyone caught lyingabout the price ofproperty goes to prison

Cuba’sreal estaterumba

A five­storey illumination of Che Guevara inHavana’s Plaza de la Revolución

An estate agent, identity concealed at herrequest, advertises a property in Havana

Cine Yara, a Havana cinema built in the 1940s

Anyone for a terrace?Wimbledon:village versus townUK property Page 3

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14 ★ FINANCIAL TIMES JUNE 22/JUNE 23 2013

House^Home

Russian-built desktop computer – soold it still runs Windows 95.

The tree-lined Prado is polka-dottedwith estate agents, their listings writ-ten in longhand in school exercisebooks. Their commission? A whop-ping 5 per cent – if, that is, the buyerpays up. With estate agency not onthe approved list of private businessesCubans can now set up, buyers knowagents have no recourse to law, somany simply refuse to pay. “I’m luckyif I get commission for one deal infive,” says one agent.

Some 45,000 homes were sold in2012, according to Cuba’s NationalStatistics Office. Observers say infor-mal deals take that number to almost100,000. Prices range from $10,000 for asmall, run-down flat in Old Havana to$500,000 for villas in sought-after dis-tricts, such as Siboney and Miramar,and more than $2m for penthouses inmodern blocks. The average price lastyear was just $16,000. The Cuban onthe calle is still desperately poor.

This being Cuba, the conditions sur-rounding home sales are complicatedand, occasionally, bonkers. The lawsays that only Cubans and permanentresidents can buy and sell propertyand they must limit themselves to onemain residence and, if they have themoney, one holiday home. Raúl Cas-tro does not want Cubans to becomeproperty barons.

Nor does he want to encouragearmies of foreign investors, especiallythe many arch-critics of the regime, todescend on Havana and buy it up,block by block. But, thanks to anearly flirtation with capitalism 20years ago, there are a few apartmentbuildings in Havana where foreignerscan buy. The best are in the AtlanticBuilding, a 25-storey tower on theMalecón, where Rafael shows me thepenthouse he says is worth $2.5m.Few want to say so publicly but someare being snapped up by Miami-basedCubans, via local relatives, making itdifficult to divine whether the émigréCuban or the relative is the realbuyer. President Barack Obamarecently relaxed the restrictions onforeign remittances from Cubans liv-ing in the US. Up to $5bn a year nowflows into Havana and much of itends up in bricks and mortar.

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Cuba’sreal estaterumba

But he might have an ace up hislinen guayabera shirt – or, rather,130km down the cracked highwayfrom Havana in Varadero. It is Cuba’s“touristic zone”, a ghetto of whitesand and whiter westerners, who sipmojitos and snap up Che GuevaraT-shirts without bothering to wonderwhat Che would make of them splurg-ing their Yankee dollars on a swankybeach holiday.

“This is where the £1.5m villas willbe. And, over here, right next to an18-hole golf course, is where the coun-try club will be,” says Andrew Mac-donald, striding across the scrub incanary yellow shorts. The Scots-bornentrepreneur runs Esencia, an Anglo-Cuban firm, that wants to buildCuba’s first new golf course since the

Other overseas investors get aroundthe restrictions by giving money to aCuban friend, or more often, girlfriend,to buy a property – although, whenthe deal is completed, some swiftly dis-cover that their girlfriend is no longertheir girlfriend. “I took a risk and itfailed,” sighs one Dutch-born investor,whose $400,000 “home” in the fashiona-ble Kholy western suburbs is nowhome to his former girlfriend and herextended family who cannot believetheir luck – and his naivety.

Tax is troublesome, too. Both sellersand buyers must pay 4 per cent butmost disguise the value of deals toreduce the liability. Raúl Castro’sdream of generating much-neededtax revenue from home sales is, so far,a forlorn hope.A couple dance the salsa in a doorway in Old Havana

An artist’s impression of Esencia’s $350m Carbonera, which will offer Conran­designed homes

An estate agent’s listings on the Prado Foreigners can buy property in the Atlantic Building on the Malecón Photographs: Mark Read

Part of the Tarara Villa complex

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FINANCIAL TIMES JUNE 22/JUNE 23 2013 ★ 15

House^HomeMacdonald wants to build 150 coloni-

al-style ocean-front villas and 670apartments. Prices for the apartmentswill start from $2,700 per sq metre andrange from 75-140 sq metres. The villaswill cost $3,750 per sq metre and rangefrom 350-600 sq metres. Six-hundredinvestors have registered an interest,Macdonald says. Buyers will havewhat passes for freehold title underCuba’s nascent property laws, and willbe able to rent out their property.

Cuba has retained the originalSpanish, pre-revolutionary land regis-try and Macdonald says it shows thatno overseas parties have a claim onthe land at Carbonera. Tens of thou-sands of exiled Cubans, who left thecountry after the revolution, stillclaim rights over properties. On abluff just along the coast from Car-bonera stands the DuPont villa, theformer vacation home of the wealthyUS chemicals family. It is now a gov-ernment-run guest house.

Investing in Cuba is only for themost steely-nerved. Not only is therethe vexed question of potential claimson properties from exiled Cubans, theCuban government has a long, igno-minious history of first encouraging

and then choking off economic liberal-isation. It relaxed restrictions onhome sales 15 years ago, only toreverse the policy a few years later.

This time, however, observers sayRaúl Castro, who is more pragmaticand less ideological than his olderbrother, is unlikely to do a U-turn. Onewestern business leader, who has setup a financial services consultancy inHavana, says: “Cuba is bankrupt. Min-isters may not like it but they knowthe only way to balance the books is toencourage the local market and toallow overseas investors to buildhomes and golf courses and maybeeventually buy villas in Havana.”

That would be good news for Rafael.The more the market expands, thesooner he hopes the government willlegalise his profession. “That way,” hesmiles, “the next time you come intoCuba, I can tell you my name.”

For details of Carbonera, visitwww.esenciagroup.comFor details of apartments to buy andvillas and apartments to rent,visit www.rent-in-cuba.comand Havana Concierge atwww.havana-concierge.com

revolution, with 800 homes availablefor foreigners to buy.

He has signed up some big names tobuild the $350m development at Car-bonera, near Varadero. Sir TerenceConran will design the homes. AdrianZecha, founder of Aman resorts, is incharge of the country-club-cum-hoteland spa. Golf champion Tony Jacklinwill help design the golf course. “Cubais the top emerging tourism market inthe Caribbean by a mile, and it’s inthe top five emerging markets glo-bally,” Macdonald says. “It’s a longslog getting stuff done but the poten-tial is huge.”

“Slog” hardly does justice to the tor-tuous process he has had to undergoto get this far, and which has cost him$3m on feasibility studies. He began

Design

negotiations in 2006 and each year thegovernment has said it will approvethe venture. But each year thenbecomes next year. Manuel Marrero,Cuba’s minister of tourism, says thedeal has finally been approved in cabi-net but Macdonald still does not havethe formal sign-off he craves.

If and when Macdonald, 47, does getthe formal go-ahead, it will mark theend of Cuba’s bunker mentality whenit comes to golf. Fidel Castro declaredgolf “incompatible with the gloriousrevolution” and ordered Cuba’scourses to be put to less “bourgeois”use. Today, one of them lies aban-doned just outside Havana; another isa military special forces trainingground; and a third forms the rollinglawns of a city’s arts school.

Views from the $2.5m penthouse of the Atlantic Building

Facade of the former Hotel New York

Tarara Villa, a 1950s state­renovated complex on the beach north of Havana

The Tarara Villa complex A house for sale in Vedado

‘Ministers may not likeit but they know theonly way to balance thebooks is to encouragethe local market’

A butler serves the Atlantic’s penthouse

The WassilychairThe Wassily chair, one of severaldesigns closely associated with theBauhaus movement, was inspired bya bicycle. Its designer, Marcel Breuer(1902­1981), graduated from theBauhaus carpentry workshop in 1924and, like many of his colleagues, wasinterested in industrial materials andmanufacturing techniques.

Breuer said he felt the bicycle (herode an Adler) was a timeless pieceof design, referring to its benthandlebars as “steel tubes likemacaroni”. Inspired by the bicycleframe, Breuer set out to create adesign using steel tubing. “I realisedthe bending had to go further. Itshould only be bent, with no pointsof welding on it, so it could also bechromed in parts and put together.”

“I was somewhat afraid ofcriticism. I didn’t tell anyone I wasdoing these experiments actually,”confessed Breuer.

The Model B3, as it was firstknown, was finished in 1924. Thedesign was only possible becauseMannesmann, a German steelmanufacturer, had recently perfectedthe process of making seamless steeltubing. Before that, all steel tubinghad a welded seam which collapsedas soon as it was bent.

Breuer has called the chair his“most extreme work . . . the leastartistic, the most logical, the leastcosy and the most mechanical”.

The first chairs were made byThonet, specialists in bent wood, butthe design never took off and wasdropped. After the second world war,it was picked up by Italianmanufacturer, Gavina, who changedthe canvas seat to leather and, afterlearning that Breuer’s friend, WassilyKandinsky, had admired theprototype, changed the name in acanny piece of marketing. Theproduction rights were acquired byKnoll, which continues to make the

chair today, andrecentlyreintroducedthe canvasversion.

www.knoll­int.com

KateWatson­

Smyth

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