Egypt’s retail and office sectors are expected to see demand recover this year despite inflationary pressures and supply chain issues, Invest-Gate reports.

According to property consultant Savills Egypt, Retail operators are benefiting from flexible lease terms as landlords seek to fill large malls, while office tenants are rushing to complete fit-out works before material costs rise further, Savills says in its Egypt Real Estate Report, released 15 May.

“The retail industry remains at an early developmental stage in Egypt and is highly underserved,” notes Sherine Badreldine, head of operations at Savills Egypt. There are opportunities for retailers catering to Generation Z consumers who want more technology-enabled shopping experiences and up-to-date fashion trends, she adds.

The average retail rent in greater Cairo was EGP 939 ($49) per sqm a month in the first quarter, with an occupancy rate of 85%, the report shows.

On the office side, tenants’ adoption of hybrid working models is fueling demand for smaller spaces between 200 and 500 sqm as well as serviced offices, according to Catesby Langer-Paget, head of Savills Egypt.

The average office rent in greater Cairo was EGP 760 per sqm a month in the first quarter, with an occupancy rate of 81%, the report found.

Large corporations are striving for sustainable, eco-friendly offices that meet environmental, social and governance goals, Langer-Paget reveals. Developments offering integrated building management systems and amenities will be in high demand, he says.

“Egypt’s real estate market is becoming more affordable for foreign investors in dollar terms but adjustments are needed to attract more,” Langer-Paget unveils. Ensuring currency stability, improving the legal framework and streamlining registration mechanisms would help, he notes.