- Analysts claim transport network vital for new city
- Cairo residential supply expected to increase by 31,000 units in 2015
- Confidence returning to Cairo market
USbased JLL says that the growing confidence in the Egyptian economy in general and the real estate market in particular has resulted in a number of major investment projects with the backing of Arab governments from the GCC.
The market has been boosted by the announcement that the UAEs Mohamed Alabbars Capital City Partnership will be developing a new major capital city.
Ayman Sami, head of the Egypt office at JLL, writes in the release that the success of the project will be dependent on developing suitable transport infrastructure, which has failed to marterialise with past major projects in Egypt, such as 6 October City.
A train network near the new city is being planned, as well as the redevelopment of two existing highways, which will further support connectivity with Cairo itself.
Although the capital city project will be the biggest addition to the countrys real estate market, there have been several other big project announcements.
MEED reported on the sidelines of the Egypt Economic Development Conference in Sharm el-Sheikh, that Housing Minister Mostafa Madbouli signed memorandums of understanding (MoUs) with local and Saudi developers for three major mixed-use and residential projects on the outskirts of Cairo.
As such, analysts are expecting that with the announcements of major developments, coupled with renewed confidence in the Egyptian economy, the real estate market is facing a period of growth off the back of a fast-growing population and a severely limited supply of quality properties.
Cairo real estate market 2015 projections
- According to a report by JLL published in January 2015, Cairos residential supply in 2014 was 104,000 units, this figure is expected to increased by 31,000 in 2015.
- More than 15,000 units were completed in the fourth quarter of 2014 (including 5,000 villas in Madinaty and 2,000 apartments in Rehab).
- However, this represents only 40 per cent of the total units that were scheduled for completion in fourth, with many projects experiencing delays.
- Delays are most common in projects by smaller developers that were unable to continue work during the recent economic downturn.
- With confidence returning to the market, developers are now more able to progress with stalled projects and the high level of delays witnessed in recent years is likely ease.