Translation: Muhammad Khalid
Eyes were on Egypt in November during the hosting of the United Nations Climate Change Conference (COP27), which attracted a huge global audience. During the event, Egypt showcased a myriad of sustainable and environmentally-aware projects. The event concluded with a range of recommendations to cut carbon emissions.
It is a no-brainer that the real estate sector is among the biggest producers of carbon emissions and the main causes of global warming. The sector produces 40% of global carbon dioxide emissions, according to Forbes.
To zero in on the issue, Invest-Gate interviewed experts regarding the efforts of the Egyptian government and developers to support sustainability and environment-aware standards and relevant recommendations, in order to reduce emissions and attract foreign capital toward the sustainable property sector as a long-term investment that preserves the environment.
Real Estate Sustainability
Osama Saad Eldin, CEO of the Real Estate Development Chamber, notes: “Egypt embarked on a mission three years ago to move towards green transformation in most sectors, especially real estate. The first manifestation of these efforts was the launch of new cities, starting with the New Administrative Capital, on immense areas with consensual environmental standards, which obligated real estate developers to maintain harmony in all their projects in each city with Egypt’s environmental and sustainability policies.”
Saad Eldin adds: “Many developers executed projects according to the aforementioned standards. Thus, reducing a big portion of administrative expenses for developers and customers alike, by abandoning some practices that increase carbon emissions, and by use of solar energy.”
Sherif Hamouda, Chairman of GV Developments, says: “Developers should now integrate sustainability and environmental standards in their projects, including safe ways to dispose of all types of waste in their projects. This will help the state minimizing its efforts in that field and contribute to decarbonization.”
As for GV’s vision for sustainable projects, Hamouda comments: “The group will offer its work model soon for all areas, including desalination plants, and won’t be confined to property projects, which became compliant with sustainable standards. Future projects [of the company] will adhere to the United Nations sustainability initiative.”
He adds: “The Customer is moved by marketing techniques, trends, and general culture in the country. Therefore, real estate projects that support sustainability and environmental standards gain traction by customers who view them as long-term investments.”
Relatedly, Abeer Essam, a board member of the Real Estate Development Chamber at the Federation of Egyptian Industries (FEI), elaborates: “There are new standards for the quality of properties, which are met in clean cities that provide [sustainable] practices to dispose of waste, use renewable energy, and increase green spaces. These practices have become a trend among developers.”
Essam remarks: “The application of sustainability standards will make a difference for developers by attracting more customers from Egypt and abroad and secure foreign currency, as inflows from foreign and Arab investors increase. The Real Estate Development Chamber expands the participation of its members in sustainability projects by showcasing available investment opportunities and attracting foreign capital to existing projects.”
Solutions and Recommendations for Sustainable Properties
GV Developments’ Chairman says: “The real estate sector does not need more pressure. I also call for clear facilities and incentives by the Egyptian government for developers, including launching financing initiatives by the Central Bank of Egypt, enlarging involvement of companies that adopt principles of sustainability in government projects, and providing more facilities in land allocation in terms of price and space. These incentives should lay down clear conditions and precede drafting and enforcing a law providing for more adherence from developers to environmental standards.”
Hamouda remarks: “The interests of both developers and unit operators come in line with sustainability principles because they cut their costs by employing healthy practices. Thus, it is a must to put in place clear steps for everybody involved to support that approach in coming projects, in order to fulfill pledges Egypt announced during COP27 and come in agreement with the era’s tendency towards the preservation of the environment.”
Tackling the same point, Saad El-Din highlights: “The right law should be drafted based on prevalent customs. Therefore, the current mission is to raise awareness among citizens and customers about sustainable real estate projects, and encourage developers to expand implementation of these projects.”
On spreading that trend among developers, Saad El-Din notes: “All developers are not equal in terms of liquidity required to implement sustainability standards in their projects. Thus, major companies will be pioneers in the field and then other companies will follow their steps after consideration of customers’ demands for units that meet requirements of sustainability.”
He explains: “The Real Estate Chamber had a real role and participated in COP27. Some companies affiliated with the chamber signed the United Nations Global Compact’s Egypt Sustainable Communities Initiative Declaration, alongside other active entities and international companies in the field. The chamber is studying recommendations by its members in the House of Representatives and the Senate to support developers, in order to implement sustainable mechanisms on a larger scale. That support could be presented from inside Egypt or abroad.”
Finally, experts reiterate that the implementation of sustainable standards in the real estate sector has become a pressing necessity for developers in order to promote the state’s relevant efforts, cope with global developments, reduce operating expenses, and cut carbon emissions.