Al Ahly for Real Estate Development Sabbour invests EGP 1bn in projects’ construction within four months in the current year, according to Managing Director Ahmed Sabbour.
Daily News Egypt sat down for an interview with Sabbour, whereby he said that his company aims to achieve EGP 6bn sales in the current year. The transcript for which is below, lightly edited for clarity:
Can you tell us about construction works’ costs in your company’s current projects?
The company has injected EGP 2bn in construction works since the beginning of the year and expects to direct another EGP 1bn by the end of December as part of the company’s policy to intensify the implementation of its various projects.
What about end-of-year expected sales values?
The company’s plan includes the launch of a number of new projects and the completion of sales in the offered phases to achieve its selling target for the current year with an expected value of EGP 6bn.
What updates planned regarding City of Odyssia project in El Mostakbal city?
The company is launching the second part of the first phase of the City of Odyssia project in the current month with expected sales exceeding EGP 2.5bn, while the first part of the first phase sales, which was launched in March, reached EGP 4.5bn.
Al Ahly for Real Estate Development launched the City of Odyssia project in March, over 578 feddans, equivalent
to 2.4m sqm and it is being developed over 10 years. It includes residential units comprising of 150 models varying from apartments to townhouses and villas, with a 25-feddan social sports club, to be developed in partnership with El Mostakbal for Urban Development company with investments of EGP 32bn. The company has allocated 50 feddans of the project for service activities, which provides a long-term return. The company also partnered with Hill International, Sabbour Consulting, Gensler Architects, and Jones Lang LaSalle (JLL). Hill International will be managing the design and construction of the project, while Gensler was tasked with providing innovative master planning and urban design services for the new City. JLL has been tasked with providing consultancy services on the development and lease of the Central Business District.
Did your company receive ministerial approval for its project?
The ministerial approval has been issued and is being obtained, and in the meantime the company seeks the completion of the building permits. Furthermore, we will soon begin the project construction.
The City of Odyssia is the third project in El Mostakbal city.The company has begun developing Green Square, on 80 feddans, and we have executed 45% of the construction and aim to reach 70% by the end of the year. Moreover, the company has sold 75% of its units and aims to reach 90% by the end of the year.
Besides, the company has marketed 90% of the L’Avenir project in El Mostakbal city and is located on 100 feddans. We have implemented 15% of the project’s construction and expect to reach 40% by the end of the year, while the investments of the Green Square and L’Avenir projects exceed EGP 4bn.
What is more, is that we have marketed over 50% of Aria project located on 108 feddans in El Mostakbal city.
Can you mention your source of funding?
The company depends on three sources of funding in the development of our projects, which include the company’s capital, banking facilities, and sales proceeds, and we determine their respective ratios, according to the economic conditions and variables during
the development phases.
What about updates on GAIA project?
The company has launched the first phase of the GAIA project in the North Coast and it is located on 285 feddans. The company received construction permits and expects to begin implementation next year, with total cost of EGP 5bn.
What about new company projects to be developed onwards?
The company will develop a 144-feddan project next year, which was received in the second tender for the land in partnership with the Ministry of Housing in the Sixth of October city.We intend to develop an integrated urban project.
Do you have updates regarding marketing fourth phase of Amwaj project in North Coast?
The company has marketed 85% of the fourth phase of the Amwaj project
in the North Coast, which is located on 61 feddans, and includes 650 families with total sales exceeding EGP 700m, and we begin the delivery phase next year.
The company also acquired 15 feddans representing the extension of the project as a sixth phase and is expected to achieve EGP 600m in sales and it is being developed in partnership.
We have also launched Revit Mall’s first phase in the North Coast and marketed 90% of it through a renting system. Plus, we are preparing for launching the second phase. The mall’s total cost is EGP 100m.
What about your company’s land bank size?
The company’s land bank is 5m sqm and seeks to increase it to 6m sqm in the middle of next year. I think developing this size of the land bank requires around eight years.
We are also considering available opportunities to choose, which is compatible with our plan, whether in partnership or through purchasing. The cities of Sixth of October, Sheikh Zayed, and the New Administrative Capital, in addition to Ain Sokhna and Upper Egypt are on our expansion plan priorities. Likewise, we have been in contact with the New Administrative Capital for Urban Development company to know all the opportunities for investing in the capital.
How do you view demand on real estate market in light of current economic circumstances?
I think that the demand for real estate is expected to increase this year, with the reduction of interest rate on bank deposits, because properties are the ideal alternative to investment, due to the high return on investment, compared to the rest of the other savings options.