The debate over new state-imposed fees on North Coast lands has sparked tensions in Egypt’s real estate sector, with developers voicing concern over unclear implementation methods. Eng. Amgad Hassanein, Chairman of Housing & Development Properties (HDP) and member of the Chamber of Real Estate Development, affirmed that Egypt’s real estate sector recognizes the state’s right to collect fees in return for its massive infrastructure development efforts. He stressed, however, that “the real crisis lies in the implementation mechanisms and lack of clarity”.

State’s Right to Fees

Hassanein explained in remarks to Al Arabiya that the philosophy behind imposing fees such as the “betterment levy” on lands located along major axes like the North Coast and the Dabaa axis is not merely aimed at revenue collection. Rather, it is the state’s right in exchange for infrastructure investments that increase the value of surrounding lands and projects. He added: “The state’s objective is not to sell land but to develop it. As developers, we believe that imposing fees on land traders who resell plots to partners is logical, and we had previously called on the government to exclude this type of player from the real estate market”.

Developers’ Objections

Hassanein said: “The decisions lacked sufficient clarity at the time of their announcement, which created confusion in the sector. The biggest issue was their retroactive application, as existing projects had already been priced and their feasibility studies conducted based on specific costs. Any new fees imposed afterward disrupt these calculations and generate instability.”

Ambiguity and Fairness

He added that the uncertainty over who would bear these fees—whether landowners or developers—fueled concerns until it was clarified that they apply to landowners, not developers. Addressing the discrepancies in demands between companies, he stated: “This differentiation raises questions, which may stem from a lack of coordination among authorities or because the implementation remains in a trial phase. Nevertheless, it creates a sense of unfairness and heightens uncertainty among investors”.

Price Impact

Regarding the effect of these fees on final unit prices, Hassanein downplayed any major impact, saying: “The effect will be marginal at this stage. Fees of EGP 1,000 per square meter of land would translate into an increase of only EGP 100 to 200 per square meter of built-up area, which is not significant”. He clarified that the issue lies not in the fee’s value but in the way it was announced and implemented.

Call for Dialogue

Hassanein concluded by emphasizing the importance of ongoing dialogue between the government and developers. He underscored that Egypt’s real estate sector contributes over 20% of GDP and positions the country as an attractive investment destination, but additional facilitation is needed to attract more investments.