Aided in part by the large domestic market, a spate of new industrial facilities, competitive labour costs and increasing urbanisation, the fundamentals of the Egyptian construction market look promising. The Egyptian real estate sector has continued to see growth, which has helped to support some contractors, but companies relying on work in the infrastructure segment, particularly those dependent on government contracts, have been suffering. Although the sector has been buoyed by positive population demographics and a mild backlog of public projects, rising costs and disputes over land ownership continue to pose challenges. However, the continued and long-term need for investment in housing and infrastructure means that diversified construction groups will certainly survive, if not thrive, over the medium to long term.
The real estate market continues to exhibit potential, despite facing many challenges in the near term. Some of these, such as uncertainty, are the result of the turbulence following the 2011 revolution, while others, such as issues relating to the availability of land, date back several decades and will require sustained government action to resolve. In spite of an uncertain macro environment, the Egyptian real estate industry has managed to thrive over the past year and looks set to continue doing so. This is thanks to very propitious demographic fundamentals and a trend towards using property as a safe haven investment.
This chapter contains interviews with Dasha Badrawi, Managing Director, Sixth of October Development and Investment Company (SODIC); and Magued Sherif, CEO, Hyde Park.