Egypt, S.Arabia step up trade ties through coordination council talks    Egypt reviews progress on $200m World Bank-funded waste management hub    Egypt urges Israel to accept Gaza deal amid intensifying fighting    SCZONE showcases investment opportunities to eight Japanese companies    Egypt, ADIB explore strategic partnership in digital healthcare, investment    SCZONE, Tokyo Metropolitan Government sign MoU on green hydrogen cooperation    Egypt welcomes international efforts for peace in Ukraine    Al-Sisi, Macron reaffirm strategic partnership, coordinate on Gaza crisis    Contact Reports Strong 1H-2025 on Financing, Insurance Gains    Egypt, India's BDR Group in talks to establish biologics, cancer drug facility    AUC graduates first cohort of film industry business certificate    Egyptian pound down vs. US dollar at Monday's close – CBE    Egypt's FM, Palestinian PM visit Rafah crossing to review Gaza aid    Egypt prepares unified stance ahead of COP30 in Brazil    Egypt recovers collection of ancient artefacts from Netherlands    Egypt harvests 315,000 cubic metres of rainwater in Sinai as part of flash flood protection measures    Egypt, Namibia explore closer pharmaceutical cooperation    Fitch Ratings: ASEAN Islamic finance set to surpass $1t by 2026-end    Renowned Egyptian novelist Sonallah Ibrahim dies at 88    Egyptian, Ugandan Presidents open business forum to boost trade    Al-Sisi says any party thinking Egypt will neglect water rights is 'completely mistaken'    Egypt's Sisi warns against unilateral Nile measures, reaffirms Egypt's water security stance    Egypt's Sisi, Uganda's Museveni discuss boosting ties    Egypt, Huawei explore healthcare digital transformation cooperation    Egypt's Sisi, Sudan's Idris discuss strategic ties, stability    Egypt to inaugurate Grand Egyptian Museum on 1 November    Greco-Roman rock-cut tombs unearthed in Egypt's Aswan    Egypt reveals heritage e-training portal    Sisi launches new support initiative for families of war, terrorism victims    Egypt expands e-ticketing to 110 heritage sites, adds self-service kiosks at Saqqara    Palm Hills Squash Open debuts with 48 international stars, $250,000 prize pool    On Sport to broadcast Pan Arab Golf Championship for Juniors and Ladies in Egypt    Golf Festival in Cairo to mark Arab Golf Federation's 50th anniversary    Germany among EU's priciest labour markets – official data    Paris Olympic gold '24 medals hit record value    A minute of silence for Egyptian sports    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



Ripplewood deal boosts optimistic expectations for Egyptian real estate market growth
Published in Daily News Egypt on 13 - 05 - 2014

A pair of deals made last week by the American firm Ripplewood to buy large stakes of Palm Hills and Sixth of October Development and Investment (SODIC), 2.3% and 9.4% respectively, has helped boost optimism regarding near term Egyptian real estate sector growth.
"American companies do not invest in any particular market or activity unless in-depth studies demonstrate an expectation of solid returns from those investments," said Mohammed Abdallah, chairman of Coldwell Banker Egypt Real Estate.
"The American company's investment in two real estate firms is a strong indicator of the sector's capability for growth in the near future," Abdallah added. "The current moment is very suitable for investment as Egypt is expected to draw closer to stability after electing a president in the coming days."
Alongside expectations for an increase in accordable and social housing which will increase real estate sector growth, Abdallah said there is demand for all types of housing in Egypt, and that this demand applies to luxury housing. There is a shortage of available units, he admitted, but said this type of foreign company searches for sectors that make a profit. This will likely not be achieved through housing projects for low-income populations, he noted.
Despite this, Abdallah expects that the two companies will begin targeting these categories by establishing projects for this type of housing across various regions, or by setting up small-sized units in larger plans.
SODIC is one of the largest real estate development companies listed on the Egyptian Stock Exchange, launching projects targeting strata that earn above-average income. Unit prices begin around EGP 600,000. Some of the company's largest projects include West Town, an integrated neighbourhood in Shekh Zayed City, the Allegria project, Forty West, Polygon, Kattameya Plaza, and Autoville.
Palm Hills is one of Egypt's largest real estate developers and has one of its biggest land banks, amounting to 17m square metres. The company is implementing 18 projects on 10m square metres of this area, and owns 7m square metres of land on the Desert Road and North Coast.
"The smooth transfer of power following presidential elections and completing implementation of the road map will motivate many foreign companies to invest in Egypt," Abdallah said.
Abdallah pointed out that he believes the uncertainty that prevailed during 2010 surrounding the transfer of power from former President Mubarak was the reason behind a large number of companies' hesitation toward entering the Egyptian market.
"The Egyptian Stock Exchange must promote the inclusion of new companies in the market in the near future and provide incentives for companies to participate," he added.
Stock market analysts said that Ripplewood is hoping to take advantage of low share prices following the economic decline that result from the 2011 revolution, alongside expectations for stability to return and prices to rise after presidential elections take place.
"The presence of American companies demonstrates the sector's strength as well as confidence in Egyptian companies," said Ahmed Badrawi, managing director of SODIC.
He said that the company would benefit from Ripplewood technically and financially by supporting the company's future plans.
Ripplewood played an important role in developing Commercial International Bank (CIB), when it bought 20% of its shares before ceding them completely in 2009.
"There still exists a high demand for luxury housing units, but SODIC considers all available opportunities in the market for all types of housing," Badrawi said. "The issue lies in providing land for affordably priced housing for less than the company's current selling price of EGP 600,000...Land prices range from EGP 500-2,000 and these prices do not allow for the construction of units at lower prices."
Badrawi said that the company is continuing conversations with the Urban Communities Authority in order to obtain the land at lower prices, adding that they "would not hesitate" to carry out projects suitable for B and C categories if they are able to find affordable land.


Clic here to read the story from its source.