Direct investments catering to The Shore project is EGP 2.5bn, Abraj Misr CEO Ali Rabie told Daily News Egypt
What are the new projects that the company is carrying out in the North Coast?
The Shore project is located in the area of Ras El Hekma, in the Kilo 186 of the Alexandria-Matruh Desert Road, one of the most beautiful coastal areas, with a total land area of 180 feddans, where its private beach is 1,100 metres long, combined with smooth sand and crystal-clear water.
The Shore resort offers a varied range of 2,200 luxury residential units with the latest facilities and prime entertainment services.
Abraj Misr has recently launched a new phase within this project: New Malibu, a unique zone with a contemporary style, comprising of units starting from 80 sqm. This premium zone is situated only 80 metres from the beach, where all units have a spectacular sea view.
What is the size of investment in the company’s projects in the North Coast?
The direct investments catering to The Shore project is EGP 2.5bn.
What is the company’s extension plan in North coast?
Abraj Misr has a land bank situated side-by-side to The Shore project. After the completion of The Shore project, we aim to expand in utilising this land bank into new projects.
What is your opinion regarding the increase in interest rate decided by the CBE?
The increase in the interest rate is one of the economic decisions that has directly influenced the real estate market in Egypt. As a result of the increase, developers are being more cautious in decisions related to stages of construction in their projects due to the high risk. One of the main difficulties faced is that developers are obliged to use the cash generated from sales to develop their project; this means that we sell before construction—with the cost increases, this has affected our forecasts in a negative way.
Consequently, price increases of about 35% in the real estate market are expected by the end of this year caused by increases in construction raw material-related costs.
How do you see the real estate market after the flotation, raising the interest rate, increase fuel prices and raw materials?
Over the past period, the real estate market has been directly affected with decisions related to the steps taken forward by the Egyptian government towards the economic reform, which has been delayed—yet it is a very important steps towards transformation that will ensure a sustainable economic future in Egypt.
The conditions for the IMF loan mandates the government to secure additional foreign funds which is already taking place due to the expected decrease in the dollar rate against the Egyptian pound and the nourishment of the market with Arab investments in all sectors.
The package of economic reform will have a positive long-term impact on most sectors. Corporations will benefit from the availability of foreign funds for importing raw materials and equipment. Although residential prices have increased as a result of higher import costs, the residential market is now more attractive for Egyptian expats and foreign investors.
We can still confirm that, although we faced a currency devaluation, the demand in the real estate market remains strong.
What is your expectations to the market prices by the end of the year and beginning of 2018?
By the end of this year, we expect an increase in market prices starting from 35%.
Does the company plan to pump new investments in the coming period?
During the upcoming period, specifically in 2018, Abraj Misr is focusing its investments in west Cairo, specifically in Sheikh Zayed through a fully integrated mixed developmental project with an area of 1.5 million sqm in a prime location on the Cairo-Alexandria Desert Road.
In your opinion, which areas’ units are the most likely to turn into a first home: Ain Sokhna, or North Coast?
As a result of the government direction towards the New Administrative Capital, this will positively impact the real estate market, especially in Ain Sokhna and then in the North Coast. Both areas of Ain Sokhna and North Coast are projected in the long run to widely become the first home for Egyptians.
What are the services and facilities needed to develop the North Coast area to be eligible for being first home locations?
With the recent positive steps done by the government in the development of the North Coast area that will lead to its eligibility for being a first home rather than a vacation and seasonal home. The government is taking solid steps in preparation of relevant infrastructure and strategic sustainable planning towards this development.