Abdel Rahman Agami: The Egyptian real estate sector is the most competitive in the region and the government’s measures will attract investments in billions.
The government recognizes the significance of the real estate sector due to its substantial contribution to the national economy. This contribution is evident through its significant share in the gross domestic product and its role in generating millions of job opportunities annually. Moreover, the sector plays a crucial role in providing housing units that cater to the diverse needs of society and aligns with the comprehensive urban development strategy known as Egypt Vision 2052.
To promote investment, the state has implemented various measures, particularly in the real estate sector. Notably, real estate developers have been granted a 10% interest rate on installments for a duration of two years, replacing the current interest rate set by the Central Bank of Egypt (CBE). Additionally, the time period for implementing real estate projects has been extended by 20% of the original timeframe. The threshold for considering a project as completed has also been reduced to 85% from the previous requirement of 90%.
The government is exploring proposals to boost real estate exports abroad, most notably a promotional campaign that will achieve this objective. This campaign takes advantage of measures that facilitate foreigners’ access to real estate, such as obtaining citizenship and residency. Additionally, the government is considering the establishment of a real estate fund comprising administrative and commercial assets that generate income. Moreover, there is a proposal to establish a real estate stock exchange.
Through these measures and initiatives, the government aims to foster a favorable environment for investment in the real estate sector while enhancing its contribution to economic growth and development.
Abdul Rahman Agami, the CEO of SKY AD. Developments, commented on the Egyptian real estate market, emphasizing its competitiveness within the region. He noted that the market stands out due to a substantial increase in demand, reaching 1 mn units annually, making it the highest demand in the region. Additionally, the market boasts a significant volume of supply. This is attributed to the government’s plan to establish 48 new cities and develop existing cities, encompassing a total area of 2.2 mn people. Once completed, these developments will accommodate over 60 mn people, surpassing the combined population of the Gulf states.
Agami acknowledged that the real estate sector has encountered challenges stemming from global and local economic repercussions. Notably, these challenges include the high cost of development due to increased land prices, building material costs, and interest rates. Furthermore, the purchasing power of citizens has been affected by rising inflation. However, the government has successfully implemented various decisions and measures to alleviate these challenges. These initiatives have attracted the attention of new foreign companies and increased investments from existing companies, leading to significant growth in real estate investment volume in recent months.
Agami indicated that the most notable decisions that have enhanced the investment climate in Egypt, particularly in the real estate sector. These include extending the time period for implementing real estate projects by an additional 20% of the original timeframe, aiming to alleviate the burden on real estate investors. Furthermore, the percentage requirement for a project to be considered completed has been reduced to 85%. Agami commended the government’s dedication to strengthening communication channels with private sector companies, addressing their demands, and engaging in discussions on submitted proposals.
Agami highlighted the positive impact of the government’s measures in facilitating the investment climate and mitigating challenges within the Egyptian real estate sector. These measures have resulted in increased investments by real estate development companies, aimed at accelerating construction progress to cope with the changing cost dynamics. The high demand for real estate investment from citizens, driven by its promising returns, has helped counterbalance exchange rate fluctuations and high inflation.
Furthermore, Agami emphasized that SKY AD.’s decision to enter the Egyptian market reflects the Emirati Diamond Group’s confidence in investing in Egypt. This confidence stems from the belief in the promising opportunities present in the Egyptian market and the government’s successful efforts in streamlining investment procedures. SKY AD.’s extensive experience in developing multi-use projects in the UAE, with investments exceeding $1bn, brings added value to the Egyptian real estate sector.
Agami disclosed the outcomes of SKY AD.’s investment decision in Egypt, stating that the company aimed to inject EGP 15 bn in investments since its entry three years ago. Out of this amount, EGP 12 bn has already been allocated to the development of four significant urban projects: Residence Eight, Capital Avenue, One Residence in the New Administrative Capital (NAC), and the Bluetree project in the heart of New Cairo. These projects not only contribute to the sector’s growth but also create numerous job opportunities. Agami further indicated that the company intends to continue its real estate development activities in Egypt, with plans to explore opportunities in various locations that will be announced soon.
Additionally, Agami emphasized the role of SKY AD. in increasing the country’s foreign exchange earnings. This is achieved through the sale of 50% of SKY AD. units to Egyptians abroad, as well as to Arab and foreign buyers who trust the company’s service quality. The successful model of foreign investment presented by SKY AD. serves as an attractive example for other Arab and foreign companies, encouraging them to invest in the Egyptian market. This, in turn, contributes to sustainable economic growth, the creation of millions of job opportunities, and a reduction in the unemployment rate.
