The New Urban Communities Authority (NUCA) is planning to expand land offerings for different segments of income besides facilitating the work of real estate companies in the new cities subsidiary to NUCA. This will happen through the application of new real estate regulations in all cities, according to vice chairperson of the New Urban Communities Authority (NUCA) for real estate and commercial affairs, Tarek El Sebaay.
NUCA completed the phase concerning resolving investors’ problems and launched a new axis for real estate investment distributed on individuals and companies inside and outside Egypt and including average and luxurious residential units.
El Sebaay considers real estate regulations as a new constitution for the NUCA, which avoids problems related to the previous real estate regulations in order to cope with the targeted plan of the investment.
NUCA held several sessions with the real estate development companies to find satisfactory solutions for both parties. Even if the satisfactory ratio reached 90% on the items of the regulations, it will be considered an accomplishment.
The regulation itself is adjustable according to the developments of the real estate sector. The ongoing discussions with the representatives of the market are necessary because the main goal is to reach an ongoing urban development mechanism that satisfies both parties and ensures the right of the state and provide the developer with a good return on investment.
The regulation includes new items such as the development of the public developer mechanism for developing new urban communities and items to govern the partnership between the NUCA and the private sector.
The real estate regulation allowed the NUCA to seek help from major real estate developers to accelerate the new urban community development in accordance with the rules laid down by its board of directors.
He added that the NUCA will cooperate with the federation of developers that is planned to be established to classify the real estate investment companies, according to several technical, administrative, and financial rules approved by the board of directors of the NUCA. Their classification will determine who will be invited to apply for obtaining the land in accordance with the abilities of each company.
El Sebaay expects the growth rates in the real estate sector to be high during this year, especially after offering large tracts of land for real estate and industrial investments, as well as offering lands for low- and middle-income individuals.
He furthermore said that the NUCA began offering the first phase of the residential lands with a total of 500 pieces in Nasser, West Assiut, and Qena in Upper Egypt, all of which are set to start being developed during the current fiscal year.
He explained that applicants must be Egyptians, whether companies or institutions, and applicants must be aged 21 and above at the time of the announcement. The conditions booklet will be obtained from the Housing Development Bank (HDB) in Qena and Assiut, and booking applications can be submitted from 9 to 27 April. The booking deposit value amounts to EGP 50,000, and a public lottery will be held in accordance with the availability of land plots and spaces.
If somebody acquires a piece of land, a payment of 25% should be completed, in addition to 1% from the total value of the land for administrative expenses and 0.5% for the board of trustees within a period of two months starting from the date of the lottery. The rest of the price of the land, 75%, will be paid in three annual instalments—the first instalment must be paid after one year.
The NUCA will deliver the land 12 months after the payment of the 25% of the total value. The construction work is to be completed within three years from the date of the delivery of the land.
31,000 new pieces of land
El Sebaay noted that the NUCA will offer 31,000 pieces of land to individuals, distributed on social housing, distinguished housing, and outstanding housing.
The pricing committee at the NUCA is currently specifying the selling price per square metre to be allocated for social and distinguished housing through a public lottery, while the outstanding lands will be sold through an exclusive auction.
Lands are distributed on 14,800 plots for social housing in 11 cities, 10,400 plots for distinguished housing in 13 cities, and 6,164 plots for outstanding housing in 10 cities.
NUCA offered more than 80,000 pieces of land over the past year, distributed through a lottery, including 21,300 plots for social housing, and 58,800 plots distinguished and outstanding housing units—in addition to 2,224 distinguished plots in the 10th of Ramadan City in a separate offering.
He explained that the real estate and commercial affairs sector developed a plan to activate the NUCA’s resources through offering investment lands for real estate companies and to individuals to be distributed on different axes of income.
Increasing the offering of the lands allocated to individuals aims at preventing lands’ trafficking and brokering. The one wishing to obtain a land will establish a house, unlike the broker who buys the land to resell it to obtain extra profit.
He noted that the NUCA deal with the developments of the real estate sector and has recently decided to grant real estate companies a six-month period free of charge to complete their projects, which are being established on the lands of the NUCA.
El Sebaay said that the NUCA has offered a number of pieces of lands for real estate companies during the current fiscal year and priced them in US dollars.
The NUCA allocated 155 acres in New Cairo to the Saudi company Najd Nile in order to establish an integrated urban project, 31.5 acres to Karnak for reconstruction and development to establish a medical city with an integrated university, and 15,800 to Arabian Andalusia Holding Company to set up a hospital.
The direct allocation will be done according to several criteria, including the financial solvency of the company which conducts the development of the project, meeting the technical conditions, and considering the payment of the land value in dollars.
Dar Misr for social housing
Furthermore, the technical opening for the offers of the competing companies over 48 pieces of lands in Dar Misr housing project for low- and middle-income citizens started.
The NUCA received 357 offers from competing companies over the 48 pieces of lands out of 98 offered in 10 new cities.
The NUCA announced 98 land plots through the one-stop shop at GAFI within two social housing projects for low-income citizens and in a Dar Misr for social housing project at 110,000 metres and 540,000 metres.
Lands will be allocated for the establishment of service and investment activities, divided between commercial, administrative, and commercial, residential, and entertainment facilities, as well as hypermarkets, nurseries, integrated schools, and several other amenities.
The booking value amounts to 5% of the price of the land, or an amount between EGP 8,600 and EGP 18,300, according to the location and size of each piece of land.
The NUCA offered services lands in eight cities and sold 15 pieces of land worth EGP 298m out of 44 plots on spaces varying between 93,000 square metres and 935,000 metres.
El Sebaay said that offering lands on Dar Misr’s websites aims at providing services to the population, where NUCA will begin to deliver the units of the first phase to those who booked them for the coming period.
He pointed out that the NUCA is preparing for the second phase of the integrated urban investment offering through the one-stop shop system at the GAFI.
The first phase of the urban investment lands offering saw 40 companies applying for booking 17 pieces of lands out of 64 pieces of lands on areas ranging in size between 3.5 acres and 106 acres, which have been announced in 20 new cities. 12 pieces of lands worth EGP 698m were allocated.
Solving the problems of the investors
NUCA was working hard in the past period on resolving the problems of the investors and made many compromises. The compromises included scheduling the payment of the dues to the NUCA, studying the demand on the real estate communities, and approving many controls to ensure that the projects development rates will not be delayed.
He said that we need to change the concept of “disputes and settlements” because the NUCA did not have disputes with the developers over funds to be settled, but the debate is over guaranteeing the rights of the NUCA without wronging the investor through deducting lands or imposing new fees—provided commitment to development, according to El Sebaay.