Chapter 5

THE RISE AND FALL OF A PHOENIX

In the second half of 2012, even though the real estate market was stagnant and the political and security situation was deteriorating, Chahe decided to purchase a $20m land in the Mar Roukoz region to develop 3 high-rises comprising 300 apartments. In order to reduce SAYFCO’s risk, Chahe sold around 40 units at the cost of $1,200/sqm to friends/investors, and he used the amount paid upfront for raising enough funds to pay a $6m down payment on the land and start the concept design in order to begin with the official sales. In November 2012, the project was officially launched and in less than 2 weeks, over 75% of the project was sold at an average of $1,800/sqm. This highlighted once again the strong reputation enjoyed by SAYFCO and its noteworthy sales performance. This further strengthened SAYFCO’s position as the leading developer in Lebanon.

Plaza Antelias was another new project launched by SAYFCO in 2012. It consisted of small luxury offices and, again, the entire project was sold out in less than a few months.

As SAYFCO was strengthening its reputation by the day, more and more landowners came to Chahe to ask for SAYFCO to develop their lands. So after Vahe had been bought out, in less than 3 years, SAYFCO had signed 28 projects and had sold over 6,000 units, with its sales value reaching $2.5 billion.

During this period, Chahe’s married life was going through a turmoil much tougher than his battle with his brother and mother. His wife had turned into a heavy alcoholic since 2004, and by 2012, her addiction was at its worst. Most of the time, she was passed out while his three young children witnessed the difficult stressful daily life through all those years, and Chahe had to cope with this stress along with his business stress which was not easy at all. He almost had no social life, as his wife would embarrass him every time they went out, passing out completely drunk.

During their battle with Vahe, Serge had convinced Chahe to withdraw all profits so that in case Vahe took the company, nothing would be left. So on one side, Chahe was spending almost all the revenue he was withdrawing to finance the high maintenance lifestyle of his wife and on rehab clinics all over the world, trying to get his wife to overcome her addiction. On the other hand, Serge was saving the money in a bank outside of Lebanon. In a couple of years, close to $15m were withdrawn by each brother. This left no working capital in the company.

At the same time, 2 of the projects that SAYFCO had signed started showing signs of loss. Both these projects were owned mainly by Mohamad Hamdoun, ex-owner of Lebanese Canadian Bank, which was shut down by the United States Treasury and Justice departments for money laundering and drug trafficking. The 2 projects resulted in an unforeseen extra cost (mainly due to the poor lands) of over $12m. Since there was no money in the company, and Serge did not want to inject his money, and as most of Chahe’s money was already spent, the bank debts began to increase. Mr. Hamdoun convinced Chahe not to ask for this $12m which were legally owed to SAYFCO, and in return promised to bring him so many projects, that Chahe would make 4 times these amounts. Chahe agreed.

At the same time, the company took other hits as well. Panorama project’s landowner had signed an agreement that $20m would be paid for land if and only if 50,000-sqm of the sellable area was obtained in the permit. However, only 40,000-sqm was obtained, and the landowner was supposed to pay back Chahe $6m. As this man was a very influential politician who could jeopardize Sayfco’s permits, Chahe could not demand his $6m. Losses amounted to $18m and the interest kept adding to this amount monthly. Another project, Saint Thomas, in Nabay, also had very poor soil and required $4m extra for construction. The company debt now exceeded $20m. Serge couldn’t take the pressure and asked Chahe if he could leave and, in return, give his 50% shares for free, as he wanted no risk to his $15m savings. So the entire Yerevanian family lived from Sayfco from 2000 till 2014, in addition, Vahe took $6.6m for his shares, his mother turned her $4m investment into a $14m asset, and Serge took $15m for his shares. Chahe agreed to save Serge as well and took all the liabilities on himself, and believed he could save the company and continue in growing the brand.

During this period, Chahe had been separated from his wife for almost a year as his wife had committed some unforgivable mistakes under the influence of alcohol other than the hell she made his life by being passed out almost every night, being violent with her children, vomiting in bed, being humiliated in public with her drunk behavior and was spending most of her time in and out of rehab, which cost Chahe millions and wasted years of his life. His eldest daughter Mia was old enough now to ask from Chahe to divorce her mom as the kids could not take the stress in the house with their mother and realized that Chahe's health was being affected negatively with this relation, and on top of all this, his wife tried to commit suicide on many occasions and once in front of Mia as she opened the window and was about to throw herself out, Mia had to run and pull her back in. Chahe separated with Reem and started the process of divorce.

In October 2014, Chahe met Gretta Taslakian, the Lebanese track, and field champion for 20 years, Pan-Arab record holder and 3 time Olympian. Chahe used to sponsor basketball teams, marathon runners, MMA fighters, etc. So when he met Gretta for sponsoring, he fell in love with her at first sight and has since been living with her. They have 3 kids together with other than Chahe’s 3 children with Reem. Ivan born on 27/10/2015 and Leo and Luca born on 10/10/2017 and all 6 children live with Chahe and Gretta. As Chahe’s new love life was blossoming, his business life was going into the abyss.

Chahe regained emotional stability and his home was back with positive vibes and his first 3 children who suffered tremendously had hope and love again given by Gretta to them. Chahe lived a true love relation which helped him survive the most difficult phase of his business career. 

Hamdoun started showing interest in entering SAYFCO as he always respected and loved what Chahe had created. A few years back, when Chahe bought out Vahe and paid him around $7m, he had sold the lands of 'Ahlam' in the mountain to Hamdoun, although at a very discounted price, this sale helped Chahe pay out his brother. So Chahe had hope that Hamdoun can be a potential strategic partner.

Chahe met with him and discussed the $12m he owed him, as this money could help SAYFCO continue. Hamdoun offered Chahe a business deal: he said he will enter SAYFCO in return for 51% of the shares and inject 8m, but Chahe had to forget about the $12m from the Suites and Horizon project. Hamdoun promised to bring new loans from banks, along with new projects where he was the main partner, and one of which alone, with a size of 180,000-sqm, would bring in $25 mullion in profits to the company.

Chahe, seeing the potential future of SAYFCO, agreed as he had no choice since banks were closing their doors on him (Chahe later found out that at the same time he was negotiating with Chahe, Hamdoun was pressuring banks as he was very close to the Central Bank governor to give Chahe no choice but to accept his offer).

Eventually, 51% went up to 60%, then 75%, and finally 90%. And Hamdoun put a condition that Chahe too should invest $3m if Hamdoun put in the $8m. As Chahe had no available funds, he had to mortgage his house, which was in the name of his 3 children, to save SAYFCO. Chahe believed that now with all these new projects and his skills in marketing, the company would be printing at least $50m per year, securing a $5m per year return to Chahe alone.

3 years passed, there were zero new projects, zero sales, and Hamdoun told Chahe that he could not bring new projects and was not keen anymore to put a dime in the company. The company debts soared to $35m, and Chahe was not getting paid even his monthly salary of $25k, and he had to close the mortgage of his house himself, which the company is supposed to do as that was part of the deal. Other than the 3 million he injected in company mortgaging his house, Chahe was taking personal loans to close to other suppliers and employees' salaries. Due to delays in projects, angry clients, and with no help from Hamdoun, Chahe was under immense stress. At the end of each year, Gretta Ghafari, who was the legal representant of the 90% shares and who was the personal assistant of 20 years to Hamdoun, signed on all financial and audited documents proving there was no mismanagement during these 3 years and she was aware that because there were no sales, the company was in trouble. Also, Hamdoun was aware that it was because of Chahe and only Chahe that SAYFCO received $6m from the Galateia project, which gave SAYFCO an extra year of life other than the $5m that Chahe injected during these years.

Hamdoun met Chahe in November 2017 and asked him to find an investor to take his place in return for his $8m investment plus $2m in profit although the company was in deficit. Hamdoun signed the agreement and sent it to Chahe to show he was ready. In return, Chahe asked Hamdoun to at least inject some money to reimburse clients and pay salaries. Hamdoun refused. Chahe started taking personal loans from loan sharks to cover the salaries of the employees and urgent payments. After months of unbearable stress, Chahe told Hamdoun that he felt he was laughed at and was no more interested in finding an investor. He added that they should meet at the end of the month after thorough auditing, so Chahe could resign and take at least half of what he owed from Horizon and Suites, equaling $6m. He had already withdrawn $2m in the previous years (which he re-injected in Sayfco Holding), as he was entitled through POA and was still owed 2.5m from Suites de Faqra and told the partners in Suites that once they all sat with Hamdoun, they could settle all amounts, take the difference from the $6m and finish the matter amicably (all these exchanges had been documented in the form of messages and emails).

Seeing that SAYFCO was doomed and there was nothing to do but blame Chahe for the fall, Hamdoun sent Mohamad Abu Darwiche and Gretta Ghafari, representatives of the company through which Hamdoun owned 90%, to Chahe’s office. They begged Chahe not to create trouble and requested him to give them a $2m cheque as a guarantee, representing the $2m Chahe took on account of Suites. In spite of Chahe informing them that there were no funds in his account and it would be pointless, they swore to him that they would not deposit the cheque and would only use it to comfort the other partners in Suites. It was Chahe’s biggest mistake: He wrote them 4 cheques totaling $1.7m. The next day, Abu Darwiche deposited the cheques and sent an official warning through a public notary to Chahe. Chahe realized what Hamdoun and Abu Darwiche were trying to do and started a campaign against them on social media namely Facebook which made Hamdoun furious. Through his political contacts and Judge friends, he pressured legal authorities to put Chahe’s name on the no-fly list, so he could not leave the country and arrest him. Chahe came to know about Hamdoun’s plan hours before it was implemented and was able to leave the country just minutes before his name arrived at the General Security of Airport.

During this difficult period from 2016-2018, Chahe decided to create a martial art promotion similar to the UFC, but for the MENA region. Thus, in July 2016, he founded the Phoenix Fighting Championship and had believed he could make this company his new SAYFCO as he was losing hope for SAYFCO. In less than 18 months, he was able to organize 8 events and signed up with MBC Action, the channel on which all his events and documentaries were aired each Thursday night at prime time. To over 150 million viewers. But when Chahe had to leave the country to avoid being arrested, he couldn’t finance Phoenix anymore and MBC had to pull the plug, putting this $3m investment in limbo; a company that had a potential to be worth hundreds of millions of dollars and whom Chahe had already found an investor willing to pay 5 million for 20% of the company but this opportunity was lost.

After he succeeded in fleeing from Lebanon, the entire Lebanese news media was talking about this, as Hamdoun was financing TV stations to discredit Chahe so that the blame for SAYFCO’s failure fell squarely on Chahe’s shoulders. He fabricated accusations that Chahe stole millions of dollars and fled the country.