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Government moves to tackle real estate sector challenges - Daily News Egypt

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Government moves to tackle real estate sector challenges

Ministry of Housing sponsors Your Estate conference to discuss the latest developments in real estate projects and finances

The Ministry of Housing, Utilities and Urban Development sponsored the “Your Estate” conference on Monday, aimed at defining the challenges facing the real estate and housing sectors and discussing how such bottlenecks can be overcome.

The Minister of Housing, Utilities and Urban Development Ibrahim Mahlab, Minister of Civil Aviation Abdul-Aziz Fadel and Minister of Tourism Hisham Zaazou were all present to provide updates on the topic’s latest developments.

According to Mahlab, the government is currently pushing for such assemblies to discuss the issues facing real estate investment and financing.

“The main focus of the government and the Ministry [of Housing] today is to start solving the problems for those [citizens] most in need,” Mahlab said

The ministry is currently working in several directions, he said, adding that the first focus project would be in “social housing”.

Mahlab noted that “the state is currently building units with areas that can reach 76 sqm in new cities and different Egyptian provinces.”

“The first phase in this project is almost complete – expected to be finalised in July – and will include around 52,000 units,” the minister added.

The second phase of the project, which will be implemented over a period of 14 months, has already begun, and will include the building of around 92,000 units.

The government is also focusing on the organisation of co-ops, which, according to the housing minister, were frozen and have suffered many challenges during the past 15 years.

“The issue of co-ops was discussed during the latest cabinet meeting, in which it was decided to raise the co-opt loan of a unit from EGP 20,000 to EGP 50,000,” the minister said.

The financing of the real estate sector is another ministry priority and is currently being studied in cooperation with the Central Bank of Egypt.

“We’re studying issues like facilitating loan conditions and changes in some of the procedures that can form challenges for investing in the sector,” Mahlab said.

Mahlab stated that the government is encouraging the private sector to offer land with infrastructure and utilities. “Several [plots of] land were sold to the private sector; however, they still don’t have the necessary utilities or infrastructure,” he said.

According to Fadel, the civil aviation ministry will assume a “stimulating and encouraging role” in real estate investment during the coming period.

“Enormous projects, with an investment value of EGP 7bn, are currently under implementation,” Fadel said.

He added that, aside from assisting the real estate sector, the projects that are being implemented will help provide job opportunities to Egyptians.

With regards to the 2014 plans for the ministry, Fadel said that there is a plan to build new terminal in the Sharm El-Sheikh airport. The new terminal will cost EGP 3bn with the capacity to hold 10 million passengers.

“Another terminal will be located in Borg-Al-Arab. It will cost around EGP1.2bn and will accommodate 4 million passengers.

“The ministry plans to offer [tenders] for the airport city project, which will be implemented over a 10m square metre area and investments of EGP 100bn.”

According to Fadel, the “airport city will include a free trade zone, commercial and entertainment facilities and several industrial projects”.

Hisham Zaazou discussed the relationship between the real estate and housing sector and the tourism industry: “The higher the demand for tourism housing projects that offer different accommodation to tourists, the more investments in the real estate sector will be made.”

Zaazou said that, so far, the number of building units for tourism housing and accommodations completed reached 54,523, with an investment registering more than EGP 9m.

“There are an additional 31,848 units that are under construction with the initial cost of EGP 6m,” the tourism minister added.

Zaazou concluded his speech by saying that the current climate is now focusing on the use of clean and renewable energy in the real estate and tourism sectors.

The minister stated he would head to the city of Gouna in Hurghada to attend a protocol signing that will help the city have a greater reliance on clean and renewable energy in order to become a “Carbon Neutral City”.

The protocol will be signed between the Egyptian Ministry of Environmental Affairs and the Italian Ministry of Environment.

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