Al Habtoor closes Lebanon operations, seeks more than $1.7 billion in compensation

Key Facts

Al Habtoor Group announced on January 28, 2026, its decision to close its operations in Lebanon, saying the move included halting activities, closing hotels and terminating employees’ services. The group estimated its losses and damage to its assets and properties in the country at more than $1.7 billion, according to the Associated Press. In its statement, the group attributed its decision to “prolonged instability, ongoing hostile campaigns, public attacks and defamatory actions” directed at it and its businesses. The announcement identifies the suspension of operations and termination of services as the stated steps, while the available information contains no documented announcement of an asset sale or completed liquidation. This places the closure decision in the context of a protracted investment dispute between the group and the Lebanese government, rather than a declared sale transaction.

The group said restrictions imposed by Lebanese authorities and Banque du Liban had prevented it from freely accessing and transferring funds it had legally deposited in Lebanese banks. The crisis dates back to the economic collapse that began in late 2019, when individuals and businesses lost the ability to access money trapped in the banking sector, according to the Associated Press. The group’s investments in Lebanon include a hotel in a Beirut suburb and a large amusement park east of the capital, the agency reported. The crisis’ effects were not limited to banking restrictions; the group estimated its losses and damage to assets and properties in Lebanon at more than $1.7 billion. These losses and restrictions are presented as the group’s account of the dispute, which later moved to international arbitration.

On April 23, 2026, the group announced that it had begun international arbitration proceedings against the Lebanese Republic under the applicable bilateral investment treaty. It said it had submitted the arbitration request and supporting documents through the International Centre for Settlement of Investment Disputes in Washington, and was represented by the international law firm White & Case. The arbitration follows the closure announcement by about three months, adding a legal track to the decision to halt operations. The group estimated that damage and losses to its assets and properties in Lebanon exceeded $1.7 billion, according to an Associated Press report on its announcement. The available information does not cite a specific subsequent development in the arbitration proceedings.

The dispute coincided with declining forecasts for Lebanon’s economic recovery. In January, the World Bank cut its estimate for real GDP growth in 2025 to 3.5% from 4.7% in its spring 2025 forecast, citing a weaker-than-expected tourism season, limited investment and limited reconstruction spending amid uncertainty. In August, the bank forecast the economy would contract 6.4% in 2026, after estimated growth of 4.2% in 2025, saying renewed conflict had reversed the course of stability and a fragile recovery. The World Bank estimated the cost of Lebanon’s reconstruction and recovery after the war between Israel and Hezbollah at about $11 billion, according to the Associated Press. In September, the International Monetary Fund said economic activity was expected to contract markedly in 2026 and inflation remained in double digits.

The IMF said the adopted amendments to the bank resolution law represented an important step in advancing a strategy to restructure the banking sector. It also said discussions covered the draft 2027 budget and welcomed the government’s aim of achieving a balanced budget and introducing measures to strengthen tax compliance. The fund said a credible medium-term fiscal framework would be essential to ensure fiscal sustainability and enable spending on reconstruction and social protection. This places banking and public finance reforms among the issues on the agenda for restoring confidence and mobilizing reconstruction funding, according to Dalia Khalifa, the World Bank’s Middle East director. The next legal step in Al Habtoor’s dispute is to pursue the arbitration proceedings the group said it began in April.