Real estate developers and government officials discussed ways of developing new urban communities, which are mainly based on the integration of employment opportunities, housing and services within these cities. As well as, the need to attract foreign investment funds to accelerate the rates of achieving that development.
During the Role of Real Estate in the Comprehensive Development System forum held Sunday in Cairo, developers also discussed the obstacles to attracting these investments, which were discovered during current discussions by the government with foreign investment funds.
Mamdouh Badr El-Din, head of the Real Estate Investment Division at the Federation of the Egyptian Chambers of Commerce said, that there are some obstacles to attracting foreign investment funds to the real estate market. The most prominent of these are the presence of a legislative crisis that does not facilitate the existence of these funds in the market.
Badr El-Din added that Egypt is implementing comprehensive development and new urban cities can be used to accelerate these funds development rates, such as the New Administrative Capital. Therefore, the government supposed to provide facilities that allow developers to expand the implementation of industrial development activities alongside real estate development, in order to achieve comprehensive development that benefits mainly national economy.
For his part, Darwish Ahmed Hassanin, CEO of the Saudi-Egyptian Construction Company noted that the system of partnership in the implementation of projects in the real estate sector, can accelerate the rates of development, especially the new urban communities.
Hassanin pointed out the need for integration of employment opportunities and housing within the same urban community, which is currently implemented, in order to prevent the recurrence of errors of previous cities, including factories only or housing only.
He added that the cities of Badr and Sadat are successful models of integrated urban communities.
Sherif Selim, advisor of the minister of housing, said that the main attractions of any new urban society are the provision of a job opportunity followed by the provision of housing and services to the citizens, stressing that the New El Alamein City is one of the new generation cities focusing on three main axes tourism, education, and residential activities.
The crisis is to structure investment system, which places limited private sector participation in some economic sectors in achieving comprehensive development, pointing out that foreign investment funds is one of the important mechanisms to overcome the crisis, Selim noted.
He added that there are current government discussions with some foreign investment funds, but there are fears of a decline in the price of the local currency, and these funds need a clear mechanism to liquefy investment and exit at any time from the market.
Meanwhile, the chairperson of Al Ahly for Real Estate Development, Hussein Sabbour said that real estate development is the main driver of the growth of the Egyptian economy during the last period, especially by allowing the participation of the private sector in the implementation of that development to become a major and strong shareholder.
“Development does not include building property only, but it should include expanding exports abroad and building factories, through which to provide job opportunities for citizens, as well as implementing service projects that provide the needs of these citizens,” Sabbour added.
Hani Dahi, head of the Engineers Syndicate and former transport minister, said “the real estate market is facing some challenges that do not affect its progress and its ability to sustain and support the local economy. The increase in population requires housing, schools, and employment opportunities based mainly on infrastructure and a strong road network.”
Dahi pointed out that real estate development should be complemented by industrial and tourism development. He called for the government to reconsider the prices of land for developers and their payment systems, in order to develop these lands and support the continuation of the real estate market.
He stressed that the Engineers Syndicate has submitted two working papers on sustainable development in Egypt, since all development in Egypt is based on engineering work, hence the syndicate will work hard with the government to implement comprehensive economic development.
Hassan Hussein chairperson and managing director of Taamir Mortgage Finance Company-Al Oula said that the real estate sector is a partner in the mortgage finance sector, but it is not fully operational because the law does not allow this.
Hussein added that the total mortgage finance amounted to EGP 12bn, which is very little, explaining that leasing activity is growing faster than real estate finance. It is targeted at commercial, administrative, and service projects.
He pointed out that the industrial sector does not face a problem of financing unlike real estate sector.
He called for a clarity of the economic and investment vision to encourage foreign investors to be boosted in Egypt, and attract foreign investment funds.