Company hopes to provide a comprehensive community for customers
CAIRO: Ever since the government made real estate development a priority on their agenda, all eyes have turned to the North Coast. However, none has garnered more attention than the Sidi Abdel Rahman Bay auction, which put the auction’s winner, Emaar Misr, in the spotlight.
Emaar Misr, an Egyptian company established in 2005 with current capital of LE 400 million, is part of the ARTOC Group for Investment and Development. The company was hatched under a 60-40 joint venture with the Dubai-based Emaar properties, with ARTOC Group holding the 60 percent majority stake.
The Daily Star Egypt sat for an exclusive interview with Mohamed Shafik Gabr, the vice chairman of Emaar Misr and chairman of ARTOC Group, to talk about why he thinks Emaar Misr won the bid, their plans for what has become the hottest sale in the North Coast and the real estate development industry in Egypt.
“I don’t want to be egotistical, but I think the reason we won Sidi Abdel Rahman is based on several factors, says Gabr. “First, we spent four months studying the North Coast, doing what we call location and environmental studies. In fact, Emaar Misr went so far as to survey European countries such as Greece, Italy and Spain to see whether visitors and retirees would consider visiting the location.
“Secondly, we did a fantastic design, even if I do say so myself. In fact, we scored very, very high marks from the Egyptian authorities for our design. Thirdly, we complied 100 percent with the tender conditions, while others may have taken exceptions. And fourth, we came with the highest price (LE 1 billion fully financed by the company, with zero debts to date, making it one of the biggest Egyptian land transactions in recent years), he states.
The company also pledged to inject LE 10 billion worth of investments into the development of the project, named Marassi.
In short, the company did its preliminary homework. And now, with the land securely tucked into their pockets, Emaar Misr is ready to roll up its sleeves and get to work.
But before the digging begins, certain studies must take place and be submitted and approved by the relevant authorities.
“The project will be complete in five and a half years from the day we are allowed to start building, explains Gabr. “However, that depends on the government. There are certain things we have to do first, such as geotechnical studies and those start next month.
According to Gabr, the site has different soils, which is why the geotechnical studies have to be carried out first. Furthermore, the company, which has contracted the Denmark Water Institute to professionally undertake the necessary studies for the project’s lagoons, will have to submit these studies to the environment authority in Egypt.
“We estimate that this process will take the better part of possibly up to eight to 10 months, and then we start moving into the five and a half years, states Gabr.
What Emaar Misr envisions is a fully integrated community development project with a touristic focus.
“We don’t want to create something that works for three months a year; that doesn’t make sense to us, says Gabr. What the company is trying to do is create a community where people can live or visit year-round that also encompasses all the services people need in one place.
“The key is to create activity and the need. We are going to have health, business and corporate facilities. Also, all the properties on the land will be managed, financed, serviced and integrated, explains Gabr. “By integrated I mean the following; you cannot build a community without having full integration. If you go to New Cairo, for example, and you want to buy toothpaste, you have to drive for an hour. If you go to the North Coast, and God forbid, get into an accident, the nearest hospital is in Alexandria. That is not integrated community development.
According to Gabr, the company will also provide a finished, quality product, be it residential, commercial, retail or office space, at the time of the launch.
Unlike most projects, Emaar Misr will work in parallel so that all phases are finished around the same time, rather than completing one phase at a time.
“This is part of our philosophy. Whoever goes into or buys our products walks into a finished product. The customer simply has to move in, says Gabr.
Emaar Misr will give their customers the option of full or partial furnishing by the company.
“We also have financial models; our prices and costing is all based on everything we have studied in the North Coast. So we are not coming and saying that we are going to go out of the market. We hired the cost of building, and we saw that with efficiency, those numbers will work, he says
Marassi will include villas, townhouses, studios, apartments and a number of hotels – from five-star to boutique hotels, to accommodate visitors in different financial brackets.
“Because the land is big enough, you are able to create different environments, and are able to cater to a wider audience, he adds.
Furthermore, the property will include an 18-hole golf course, amphitheater, sports stadium, conference center and a town center and marina, which will create an extra-added attraction for people, according to Gabr.
“Due to the internal and economic stability of Egypt today as a country and destination, people are looking towards Egypt, says Gabr, which is why the company is aiming to attract local, regional and international visitors.
“We found based on our studies that a lot of the people that want to come from abroad to retire or live here, want to go to Alexandria. Alex is a big thing in the minds of southern Europeans, whose fathers and grandfathers lived here. They want something close, but all they find is a property or house to buy, not a community, says Gabr.
Emaar Misr will also attempt to lure in the yacht industry, a previously untapped market.
“Yacht business goes all the way from St. Tropez to Greece. They come all the way to Israel but not down to Egypt, simply because we have no facilities, no infrastructure, he explains.
According to Gabr, poor infrastructure has been the weakness of Egypt’s real estate development market for decades.
“Over the years, real estate development in Egypt short-changed the consumer. Quality was bad, customers got unfinished products and there was a lack of proper servicing and management. Financing didn’t exist and people had to carry around a suitcase of money, says Gabr.
Emaar Misr, whose capital reached LE 400 million this year, are looking to change that situation.
“We are creating a totally new benchmark on real estate development, says Gabr.
As for competition, Gabr welcomes it.
“I love competition. Competition gives you the opportunity to show either that you’re better or worse. Also, being an Egyptian, competition brings the best to Egypt as it brings up the level of quality, states Gabr.
Emaar Chairman Mohamed Shafik Gabr