During an in-depth interview with Invest-Gate, Ashraf Dowidar, the CEO of ARDIC for Real Estate and Development and Investment shares his view on the market’s ups and downs, and how he has succeeded in challenging Egypt’s current monetary policy.
In your viewpoint, how can the market deal with the new monetary policies?
The market has been weathering changes in monetary policies since the last devaluation of the Egyptian pound against the USD. We have seen a rise in the prices of residential units by 35-40%, following the decision taken last November.
Some real estate developers consistently altered their future strategy on developmental and pricing policies since upping construction costs keep occurring. Construction costs have increased by 100% since the flotation.
The case with ARDIC is that instead of injecting investment in three projects, we inject in two projects only to cope with the delivery dates. We are adopting a financial policy of depending on our portfolio instead of relying on bank loans, which at the end are limited to certain funding amounts.
In your opinion, how have the current challenges in the market affected marketing and sales plans?
The fluctuations in purchasing power and [the recent] shift is significantly affecting the categories of the prospects and clients, as well as their future vision. We are trying to copy with all these changes to make ends meet.
What are the new projects you have offered this year?
Egyptian property developer ARDIC for Real Estate Development and Investment has uncovered a new phase of Zizinia El Mostakbal,The Curve phase. Located in Mostakbal City New Cairo, The Curve enjoys proximity to various hotspots. The company offers its clients a payment plan over seven years with a 5% down-payment or ten years with a 10% down-payment.
Construction works on the project started last November. The project includes residential units with areas ranging between 160 and 570 meters.
Zizinia El Mostakbal units are to be fully constructed and submitted by 2020, noting that 45% of the project’s units have been sold out.
What are the expected sales of your currently new residential project Zizinia El Mostakbal?
We expect sales of EGP 4.5 bn from the Zizinia El Mostakbal residential project. The total investment we have pumped so far is EGP 450-500 mn in Zizinia El Mostakbal residential project. The project is located in Mostakbal City on the main axis of the Road 90 extension near Madinaty and 12 kilometers away from the American University in Cairo (AUC). It is easily accessible through the Suez Cairo Road.
How do you think exhibitions will help boost the marketing, and is it a good indicator?
I cannot estimate accurate figures of investments driven from exhibitions, but as you know the marketing tools are varied. Currently, developers are depending on digital marketing, billboards, and exhibitions. But in my viewpoint, clients from exhibitions are the real customers and buyers.
How do you see the impact of the new investment law on the local economy as a whole?
It is a positive step, but we still need to measure the real impact after we see the executive draft of the law, translated into tangible results. Legislation alone cannot make the change, unless it is really implemented.
Do you see social housing projects as a competitor to ARDIC?
Of course not. Firstly, we are targeting an entirely different segment. Moreover, the social housing projects are committed to certain apartment areas.The second reason is because demand remains high versus what is offered in the market.
We do think that entering into a partnership with the public sector will be an added-value or will facilitate our projects to a great extent in terms of land acquisition with ready infrastructure and facilities.
What is the company’s future plan?
ARDIC plans to purchase a land plot from the government for a mixed-use project in Upper Egypt. Such a plot is for a mixed-use project with health, residential, and commercial facilities.
The company is going in tandem with the government vision of decentralization and expansion to Upper Egyptian governorates.
The company’s plan relies on investing in the fields of industry, real estate, tourism, services, housing, and reconstruction.