AB Vizyonu

By Bernd Struben, Senior Editor REP

An interview with Mustafa Ozdemir, Managing Director, First Title Turkey

First Title is a wholly owned subsidiary of First American and has its UK offices in London, Bromley, Camberley, Glasgow and Leeds employing over 600 people. The company provides a range of insurance, processing, conveyancing and property services and is committed to streamlining and protecting property and mortgage transactions.

Mustafa Ozdemir, Managing Director, First Title Turkey

Mustafa Ozdemir worked as a private real estate investor specializing in land investments before turning to the professional market in early 2006. He worked for a boutique investment bank as the head of real estate finance and investments prior to joining First Title in late 2007. Since that time he has been running the Turkish operations of First Title.

Why did First Title decide to expand into Turkey?
Turkey has a young and dynamic mortgage market which remains unaffected by the sub-prime crisis. With a total value of TL 38 billion (approx. €16.2 bln.) - as of February 2009, it’s just starting to grow - which is why the First Title group believes that entering this market at such an early stage is an astute move for the business. First Title has been focusing a great deal of its attention on the CEE region, due to the fact that it has been an area of unprecedented growth in recent years. Expanding into Turkey continues First Title’s successful strategy of diversifying its product and geographical risk over the last 15 years.

How is operating in Turkey different from operating in the UK and continental Europe?
Turkey is a country with Eastern roots. It has turned its face to the Western world for over a century and it’s become a mixture of both. Any foreign company entering Turkey has faced and tried to understand this mixture. It is also a multi-ethnic society. Companies have to adopt themselves to this environment. The country is also in the process of accession to EU. During this transition period, laws and regulations are changing rapidly which is confusing. They are sometimes annulled and enacted again with different clauses and it is making the business environment difficult not only for foreign companies but for all. For instance the law that permits foreigners to acquire real estate in Turkey has been annulled and enacted again many times. It has made it difficult for developers, investors, lenders and service providers. But companies like us believe in the potential of this market and we are adapting ourselves to this environment.

What sets First Title apart from your competitors in Turkey?
First Title’s philosophy requires a long term approach and understanding of the local market before expanding. Our competitors have looked for opportunities in the Turkish market in previous years, but they haven’t been able to expand their presence in the market. Our philosophy lets us stay in the market until we fully understand it, see the opportunities, and the market accepts us, our products and services.

What are you currently involved with in Turkey?
We have two main businesses: Title Insurance and Processing Services for Lenders. We run Title Insurance business via First Title Sigorta Aracilik Hizmetleri AS. and Processing business via FU Gayrimenkul Yatirim Danismanlik AS. First Title provides title insurance policies for property owners and lenders whereas FU provides processing and mortgage registry services for the lenders.

Which property services are undersupplied in Turkey?
Most of them. Only one is oversupplied which is Real Estate Brokerage. You can find a realtor on every street corner but you can’t find any data on property, you can’t find statistics, you can’t find mortgage brokers to tell you which mortgage is best for you, you can’t find consultancy on how to invest on property. These services are all difficult to find.

Can you comment on your recent acquisition of 38% of FU Gayrimenkul Danismanlik?
Since it’s establishment in 2006, with outstanding efforts from its respectable founders Jale Kuleli, Zekeriya Yildirim and Atilla Coskun and its hard working staff, FU has grown to become the leading provider of outsourced legal and processing services to Turkish lenders. FU looks after the search and examination of title and registration of mortgage securities for its leading lender clients. The company offers its services through a network covering 75 provinces of Turkey, and it expects to process more than 50,000 mortgages and other loans in 2009. By this acquisition we are going to combine First Title’s niche real estate insurance products with FU’s nationwide platform of legal and processing services and deliver a unique service to anyone buying, selling or lending against real estate in Turkey.

How is First Title responding to the current economic slowdown?
As a company which has paid cash dividends to its shareholders for each of the last 100 years, First American has seen many of these downturns and has maintained its leading market share despite them. We have of course been affected by the US and UK market turbulence but we know how to deal with these kinds of economic downturns.

What are your goals and plans in Turkey for the near future?
We are looking for opportunities to acquire or establish new businesses. We have got plenty of products and services around the globe. When we see the opportunity of combining our expertise and know how with a local company’s presence, we don’t miss the opportunity. However, we are mainly focused on introducing our core product - title insurance to the Turkish market as we know that this unique product will attract more and more attention in these risk-averse times.

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