Site in Sidi Abdel Rahman, North Coast worth over LE 1 bln
CAIRO: The Holding Company for Tourism and Cinema (HOTAC) announced that Dubai-based Emaar Properties has won the bid for a prime real estate site in Sidi Abdel Rahman on the North Coast.
The land, which will be developed into a large tourist resort, was sold by HOTAC (which is in charge of selling the land and will have a stake in the project of no more than 15 percent) to Emaar, who reportedly bid LE 160.5 per meter for the 6.259 million square meter land, or an equivalent of more than LE 1 billion for the whole project, making it currently one of the largest land transactions, according to the Ministry of Investment.
The Dubai-based property giant beat Egypt s Orascom Hotels and Development (OHD) and Talaat Mustafa Group, an Egyptian real estate investment firm, in the race to buy the seven-kilometer strip of tourism real estate, the Ministry of Investment said.
The sale, which includes Al-Alamein Hotel, has been much sought after by tourism developers, both locally and regionally, as the sheer size of the land, which is located in the North Coast – an area that is being outfitted to become the French Riviera of the Middle East – is expected to provide huge profit opportunities for the winning bidder.
“The North Coast has the capability to be developed as whole new cities, born year round, rather than just a number of hotels. We can have multiple Cairos within the area, Mohamed Kamel, corporate vice president of strategy and governance of Kato Investment, the umbrella under which stands a conglomerate of companies, including Kato Real Estate Development (which owns Ghazala Bay in the North Coast) and International Airport Company (which owns Al-Alamein International Airport), previously said to The Daily Star Egypt.
In Egypt, the tourism industry, considered one of the largest markets in the world, and ranked as the 28th biggest tourism destination, is the number one contributor to the country’s economy, amounting to 22.1 percent of Egypt’s foreign exchange earnings. Currently, it directly and indirectly employs 2.2 million people, amounting to a whopping 10 percent of the labor force.
At the end of 2006, the industry is expected to have garnered $7.2 billion (LE41.3 billion), compared to the $6.4 billion (LE 36.7 billion) it netted last year.
Tourists in Egypt are also forecasted to reach 9.6 million in 2006, in comparison to the 8.5 million who visited the country last year (up by six percent from 2004). The country is also planning to attract 16 million tourists in the next six years, said Minister of Investment Mahmoud Mohieddin at the last World Economic Forum on the Middle East held in Sharm El-Sheikh.
In order to do this, the government has set its sights on the North Coast, where land is rapidly being sold off to foreign investors and developers in order to increase FDI in the country.
Emaar, which has invested quite a large sum in Egypt’s tourism industry by way of tourism development projects, is the most recent of regional investors to turn its eye to the North Coast.
“You can look at the North Coast in two ways; as North Africa or as southern Europe, because it’s a natural continuity of the Mediterranean coast, Kamel previously stated. “This is partly why it’s attractive to foreign investors, he added.
According to Shafik Gabr, a representative of Emaar in Egypt, the company will invest LE 10 billion ($1.74 billion) to develop the land to become a major resort and tourist attraction on the Mediterranean Coast.
According to the Ministry of Investment, Emaar’s development project will include two five-star hotels, a marina, luxury golf course, shopping centers, a mosque, heli-pad and sports facilities. Emaar will also spend an additional $1.74 billion (LE 10 billion) to develop the site, and estimate that the project would be completed five years after receipt of the land.
Emaar s proposal for the land included plans for 4,023 hotel rooms in addition to more than 5,300 residential holiday units, Minister Mohieldin was quoted as saying in an official statement.
The aim of the project at Sidi Abdel Rahman and Al-Alamein is to develop the site to make it an all-year-round attraction for European and Arab tourists, exploiting its moderate climate and beautiful shores, HOTAC said in a press release.
HOTAC holds 22 hotels and two Nile cruisers of the most renowned hotels in Egypt ranging from Luxor, Aswan, Cairo, Giza, Alexandria, the Red Sea and North Coast with hotel capacity amounting to approximately 5,000 rooms.
The Sidi Abdel Rahman project is the latest in a string of wins for Emaar in tourism and tourism-related development projects in Egypt. As part of a global plan to build prestigious residential development projects, in August last year Emaar unveiled plans for a $4 billion (LE22.8 billion) project in Cairo, known as Cairo Heights, a development project in the capital. This was soon followed by the launch of an integrated community based in Smart Village.
