Emaar: Government Must Support Mortgage Funds To Activate Market
Emaar Misr is one of the leading foreign real estate developers working in the Egyptian market, the volume of its investments posted to EGP 32 billion, with a land portfolio of 15 million m2. Emaar owns real estate projects in the North Coast, New Cairo, Mokattam, and others.
In his interview with “Amwal Al Ghad” Eng. Hazem Ashry, General manager of Emaar Misr, revealed the company’s plan to implement its projects, his view of the Egyptian market, and highlighting the challenges faced real estate sector after the revolution.
Firstly; how revolution affected either sales or Lands Portfolio?
The company achieved a 20% increase in sales during 2011 compared to 2010, as it is possessing ready and fully finished units, suitable for the demand’s level in the real estate market during the period after the revolution. Therefore Emaar was able to complete its projects with a large share of sales in 2011.
About portfolio, currently, we have three main projects “Uptown Cairo – Mivida – Marassi” in addition to the “Cairo Gate” at Kilo 28 Desert Road, those four projects area is 15 million m2, and we are still in the early stages of these projects.
Any updates about “Uptown Cairo” project?
The company is now to extend the project’s infrastructure for the three stages, while the first stage is about to be delivered. “Uptown Cairo” is a residential, commercial and entertainment project established on an area of 4.5 m2, with investment cost EGP 12 billion.
Uptown Cairo also includes business complex, shopping centers, resorts, clubs and “spa” as well as a number of recreational and sports facilities integrated, in addition to the golf course.
We Target to deliver the first phase of 400 housing units during this year, the development takes up to 10 years, to bring total number of units of the entire project to 5 thousand units, on 2017.
What About Prices?
Prices start from one million LE with no maximum limit, varying from one project to another and from one unit to another one, all of which are fully finished, notably that “Uptown Cairo” is the only project with perfect views on internal valleys, and mountains and, in same time, an external view for the heart of Cairo, which makes this place represents the a major challenge for the company
Payment systems provided by the company up to 7 years installments without interest, and only 5% deposit.
How did you deal with the recession witnessed after the revolution?
We are amid first companies that started advertising campaigns in newspapers, roads, and we started a national campaign, not promoting for Emaar’s projects, but calling for Egypt’s stability as one of the main targets for the company’s social responsibility.
Do you cooperate with mortgage finance companies?
We have contracts with mortgage finance companies, but most of sales are performed directly through Emaar, because we already have a good payment system, to face rising in mortgage interest mortgage to 16% compared to other countries where interest ranges between 5 and 8% maximum.
Banks are accused to halt their real estate financing, what do you think?
I do not feel so, because there is no decline any agreement between us and banks, although, we understand the case of anticipation experienced by banks during the previous phase and their look to the real estate sector.
I believe that banks will have to re-invest in this prominent sector, after cirmustances are stabilized and real estate sector regains its performance.
What are your expectations for Emaar in 2012?
We have a percentage of annual increase in sales which is estimated at 20%, and we expect that percentage will continue to grow during 2012 to exceed 50%.
In your point of view, How can Egypt attract foreign funds?
The ability to attract foreign investment funds in real estate sector has a set of mechanisms; the most important are strong and active regulations for these funds business in Egypt.
In addition to the government’s role in spreading awareness campaigns for individuals, developers because most of these funds are individuals, social insurance or pensions.
What about banking transactions?
The size of our projects is huge. Our three main projects investments are LE 32 billion, a part of the funding depends on the sales and borrowing.
There is always a demand for loans as long as the work is ongoing. We had a short term loan, and is being converted to long-term one, we also have a range of syndicated loans led by a HSBC & CIB.
Do you expect a decline in demand for luxury housing?
There is high demand on luxury housing, especially after most of the companies have tended to reduce the areas of its units while keeping global quality standards of intelligent buildings and green spaces as well as architectural designs, which has been implemented in “Mividia” project.
