(Photo Handout to DNE)
Colliers International’s most recent involvement in Egypt was as an advisor to the UAE’s Emaar on its Uptown Cairo project, and Qatari developers constructing a luxury resort in Marsa Alam.
In an interview with Daily News Egypt, Filippo Sona, Colliers International’s hotel director for the Middle East and North Africa, said that while Egypt has several elements that make it stand out in a region that draws millions of tourists annually, the country needs to redevelop some buildings and streets in Cairo, to bring back life to the 1960s architecture to boost regional tourism to the capital.
He also noted that the tourism sector has already reaped the fruit of political and economic stability, but that the goal set by the government to make a tourism income of $26bn by 2020 may extend to 2025-2030 instead.
Egypt targets an income of $26bn from tourism by 2020. How do you see this figure in terms of feasibility? What does Egypt need to do in order to achieve it, and is it on the right track?
In our view, the recovery of the Egyptian tourism is likely to take longer than anticipated. Despite the positive start of 2015, with all the industry’s key performance indicators suggesting that the market is on a growth pattern, the industry will reach this level of tourism income for the period of 2025-2030.
How do you assess Egypt’s tourism sector competitiveness, as opposed to other countries in the region? What does Egypt lack to outshine other key regional tourist hubs, and raise its competitiveness?
Egypt is one of the most attractive and complete tourism destinations of the region, as it offers history, gastronomy, natural resources and entertainment. What Egypt requires, which has already started, is political and social stability, which will eventually boost foreign tourists’ confidence in the market. From a real estate point of view, perhaps the re-development of some buildings/streets in Cairo as more micro-destinations (bring to life the 1960s architecture complemented by boutique hotels) that will boost regional tourism into the city.
In terms of the second/summer home market, how big is this market in Egypt? And where does it stand in comparison to other markets in North Africa, such as Morocco and Tunisia, or Dubai? How can Egypt attract more summer home purchasers?
Northern Egypt is already popular with the domestic investors, with many Egyptian owning a second home in places such as Alexandria. The North Coast has a fantastic coastline and the perfect weather for second homes. The development of new mixed-use developments, which incorporate a resort managed by an international brand, can create induced demand. Price however will be important as the area is very seasonal and therefore the cash flow is limited to a few months only. Further south, Marsa Alam is also a destination that has huge potential for the second home market, and with the climate of the place, it will also attract investments from European investors.
Egypt is working on adopting the electronic issuance of tourist visas. What does it need to keep in mind to maximise on benefits that this system could bring to its tourist influx?
Despite the benefit of speeding up the process of applying for visa, the authorities need to maintain a high degree of security to protect the country and the tourists. Although the immigration service will be faster, there is still the need to have multiple security points/searches in order to keep Egypt safe.
How do you see recently-announced, national, mega projects affecting the flow of tourists in Egypt in the short run?
This is very important for investor confidence, and the positive effects of this are felt at the local level, with developers eager to re-start projects that were previously stalled due to the social unrest.
How do you see oil market fluctuations impacting the performance of the tourism sector on Egypt, if at all?
Political and social stability for now has a far greater impact on tourism than the oil price market, as Egypt has a variety of destinations for any budgets, therefore its offering can cater to any kind of demand.
Can you tell us about projects that Colliers International has been a part of in Egypt? Should we expect the company’s involvement in any new projects in the near future?
Colliers in the past 12 months has been advising major developers in Egypt, in particular Emaar on their Uptown Cairo, and Qatari developers in the creation of a world class resort in Marsa Alam, comprising an 805 key internationally branded hotel. The scheme is under construction and once open it will create jobs locally and contribute positively to the economic development of the wider area.
