Oscar Misr targets sales of EGP 100m within 12 months, Mohamed Beheiry, chairperson told Daily News Egypt.
In an interview with Beheiry said the market prices increased by 30-45% within a year from August 2016 until August 2017.
What are the company’s projects?
Oscar Misr Real Estate Company is a new company in the real estate sector. We started our projects in Shorouk City, and we expanded our work in Beit Al Watan region in Fifth Settlement, New Cairo.
When will the company deliver its projects?
We will hand over the first project by the end of the current year in December in Shorouk and consists of 18 units. The second phase of the project will be handed over by the end of 2018.
The first project in Beit Al Watan will be delivered in 2020, and we won’t start construction just yet, due to the process of connecting utilities is still ongoing. The company focuses on completing the construction of its projects in accordance with the set timetables, and it plans to deliver all new units to customers before the scheduled deadline mentioned in the contracts. Furthermore, the company depends on experienced contracting companies to implement high-quality projects.
What are the unit’s sizes?
The sizes of units in Shorouk project are small and big apartments, and duplexes start from 120sqm up to 250sqm, and our project in Fifth Settlement starts from 119 sqm up to 355 sqm.
Does the company deliver fully finished units?
It depends on the client’s willingness. Some of them demand a fully finished unit. Others prefer finishing their units on their own. Some clients buy their units for investment purposes, so they prefer not to finish the unit at the lowest price.
What is the percent of increase in the company’s unit prices?
The increase in the market prices ranged between 30-45% within a year from August 2016 until August 2017.
How much was the increase in construction costs during the year?
We have two costs: land price and construction material prices. However, land prices didn’t witness a high increase unlike building materials, which increased significantly in their prices, which I believe increased from 60-70%. Land prices, on the other hand, increased by 30% to 35%.
Does the price increase affect your sales?
Since the decision of the Central Bank of Egypt to liberalise the exchange rate in November until March, the market witnessed a significant shrinkage. After March, the market was revived due to amending the payment method through expanding instalment periods.
What are the facilities provided by the company to attract more clients?
We decreased the down payment from 35% to 25%, and we increased the instalment period to six years—besides, special offers to regular clients.
What is the current financial situation of the company?
The financial position of the company is strong enough to carry out its projects in a timely manner. The company highly depends on self-financing for the construction process as well as cash collected from sales, especially that most of the projects have already been marketed, and the company does not plan to borrow from banks to finance its future expansions.
What are the problems facing the company?
The most important challenge facing our company as a newly established real estate one is the reputation. Some companies are trying to build a good reputation to attract clients, but some companies seek for profit first so they decrease their unit’s prices and they couldn’t deliver their units on time, so those companies are accused of defrauding, which affects the reputation of other companies.
How do you handle the increases in raw material’s prices?
First of all, there are some companies put the burden in the increase of raw materials on the client, even after they paid a down-payment. I know that this is not something that is common in the market. We, on the other hand, bear the increase from our profit margin.
Do you have to pay any dues to contractors?
No, we don’t.
What is your opinion regarding the New Administrative Capital project?
The project is considered a major breakthrough in the coming period in the Egyptian real estate market. Furthermore, the development of the New Administrative Capital increases the land value in Beit Al Watan, Fifth Settlement, where we work.
Besides, we have an ambitious plan to buy land in the New Administrative Capital.
Do you plan for launching coastal projects?
So far, we don’t have plans for investing in coastal areas, but we are studying the prospect of doing so in the North Coast.
What is your expansion plan in Cairo?
We target acquiring separate plots of land in Beit Al Watan on an area of 1,000 sqm, and we target marketing them in the coming period, to be delivered in 2020.
What is the size of the investment cost in construction works of the company’s projects?
It is about EGP 50m.
What is the targeted sales during the coming 12 months?
We target EGP 100m during 12 months.
Do you think that liberalising the exchange rate and increasing interest rates affected the market?
Definitely yes. The market was revived despite the increase in interest rates. If interest rates were not increased, however, the market might have witnessed an even greater boom.
