Egypt Government restores EGP9 billion from Talaat Moustafa’s Madinaty

Egypt’s General Prosecutor reached an EGP 9 billion (US$1.2 billion) settlement Wednesday with real estate developer Talaat Moustafa Group over its Madinaty project, after a long-drawn out land dispute.

In 2010, Egypt’s High Administrative Court decided in a court ruling that the US$3 billion Madinaty land deal is void, citing that “the method of the selling [of the state-owned land to TMG] made the price less than the land’s market value.”

Following the verdict in 2010, real estate prices dropped.

But in 2011, another court ruling asserted that the Madinaty contract was valid, but ruled that a committee be set up to reevaluate the lands not yet used for construction.

The project became mired in legal disputes because the Mubarak-era governments sold the land directly to TMG without a public auction as required by Egyptian law.

Madinaty, which includes homes, hotels and a golf course, is one of the most ambitious examples of a Mubarak-era drive to re-house mostly rich and middle class Egyptians on the outskirts of the teeming, polluted capital Cairo.