- Egypt invites more firms to invest in 1 million homes project
- Local contractors sceptical of housing scheme
Egypt may struggle to attract investment from local companies for its ambitious housing plans as contractors become increasingly frustrated with the lack of transparency surrounding the 1 million homes project.
Local contractors have told MEED the lack of information surrounding the agreement between Cairo and the UAEs Arabtec Holding means some companies are reluctant to get involved in the scheme following news that the UAE firm will only build 100,000 housing units.
Several construction professionals working in the Egyptian market have told MEED: Until we know the terms of the deal between Arabtec and the government, we wont be interested in such a complex project that has had so many problems surrounding it.
Few details of the initial deal with Arabtec have been released and local contractors have been left frustrated with the lack of transparency, which will mean Egypt may struggle to attract the interest needed in order for the $40bn plan to materialise.
In May, MEED reported that it is understood the Egyptian military and housing ministry may want Arabtec to only use local materials to build the homes, as well as use an external auditor to monitor compliance with a new profit cap. It is unclear if the same conditions will apply to other companies that show interest in latter phases of the project.
On 31 August, a spokesperson from Egypts Housing, Utilities & Urban Communities Ministry told MEED that Arabtec will now only develop the 100,000 units that make up phase one of the major housing scheme, not the originally planned 1 million homes across the total development.
The spokesperson said the ministry is looking to attract interest from other local and international investors to develop the rest of the scheme and the remaining 900,000 units.