Businessman Naguib Sawiris, Chairperson of Ora Developers Egypt, announced that his company delivered the first phase of the ZED Sheikh Zayed project without making any profits.
He said: “We made zero profit,” attributing this to the rising inflation rates and the depreciation of the local currency.
Speaking at a press conference on Sunday, Sawiris pointed out that the increase in bank interest rates to 30% poses a major obstacle to achieving profits.
He also cited it as one of the main reasons for the rising property prices in Egypt, emphasizing that these high rates negatively affect developers’ ability to deliver projects on time as promised to customers.
He further explained that the prices of construction materials, especially steel and cement, have significantly increased over recent years, adding pressure on real estate developers who are committed to delivering units on time, despite incurring heavy losses.
Sawiris called on the Central Bank of Egypt to reconsider the interest rate on loans, noting that the 30% rate is not only a challenge for the real estate sector but also affects other economic sectors.
Regarding a potential real estate bubble, Sawiris expressed optimism about the growth of the real estate sector but stressed the importance of handling it with caution by both the government and developers to avoid any future crisis. He added: “We, as a company, are working carefully to avoid falling into this situation and will not tell our competitors what they should do.”
Sawiris also highlighted the importance of Egypt’s advanced infrastructure and road networks, which have greatly improved the connection between East and West Cairo.
He added that Egypt has become a global destination, praising the attractiveness of the Mediterranean region, especially the North Coast, for wealthy Gulf Arabs, which helps in providing foreign currency to the country.
Sawiris revealed that the foundation stone for the Ras El Hekma project will be laid in collaboration with the Emirati side on 4 October. He mentioned that the project will include a world-class marina and an international airport, and it will significantly contribute to attracting European tourists, benefiting all real estate developers in the region.
Sawiris pointed out that the economic challenges in Egypt and the high interest rates have forced developers to delay project deliveries as per the agreed timelines with customers.
He commented that the prices of construction materials, particularly steel and cement, have seen significant increases in recent years. Customers pay booking deposits, and developers are required to build and deliver on time, which results in substantial losses for real estate developers.
