CAIRO: Egyptian developer SODIC expects high demand for new housing to continue, eliminating the chances of a housing bust, its managing director said on Tuesday.
We haven t begun to scratch the surface in terms of really being able to adjust for the significant lag of supply over the past few years, Maher Maksoud told reporters.
We do not believe that there is saturation in the upper-income level (demand for housing), Maksoud said. There has been greater mobility in the last couple of years with a lot of people moving from the middle class to upper incomes.
SODIC is one of Egypt s largest developers by market value focusing on residential and commercial developments.
However, Maksoud said the launch of sales for SODIC s two mixed-use projects Westown and Eastown has been pushed back until economic conditions improve, although pre-construction activities continue.
We re in a position to focus right now on simply building out our existing sold projects while doing various preconstruction activities on our unsold projects and to launch at a later date.
Maksoud was confident in SODIC s ability to emerge from the current economic crisis intact, citing zero debt, few payables, and the fact that all the company s land is paid for in full in cash.
There are some economic conditions which we have to weather. SODIC is one of the real estate developers that is in the best shape in terms of being able to weather that storm, he said.
In the meantime, SODIC will launch other projects it feels can be sold in the current economic conditions, such as aggressively-priced smaller apartments and townhouses.
Maksoud also said there was also enormous demand for office space, with Egypt s supply among the lowest in the world in terms of population and per capita GDP.
We re very keen on getting into office space and middle-income housing and retail, Maksoud said.
SODIC, with about 5 million square meters under development, has residential and commercial developments east and west of Cairo.
The company said its total assets in the first nine months of 2008 were worth LE 4 billion ($724 million), up 83 percent on the same period in 2007.
Shares in SODIC last traded 2.4 percent down at LE 40.88 per share on Tuesday.
