While the Covid-19 pandemic put pressure on real estate sales after a partial lockdown in early 2020, the sector has demonstrated resilience over the medium term. According to the Aqarmap Egypt Index, in March 2020 real estate demand fell by a record 29.6% to 1936 points, the lowest level since the Egyptian pound was floated in 2016. However, by March 2021 demand had recovered to 2483 points, and as of February 2022 stood at 2739. Aggregate sales were down 32% year-onyear (y-o-y) in the first half of 2020 to LE22bn ($1.4bn), before experiencing a 17% y-o-y recovery in the second half of the year, to LE43.2bn ($2.7bn).

The sector’s performance was buttressed by real estate’s reputation as a safe haven for investment, economic recovery in the second half of 2020 and demographics trends. Around 60% of the country’s population is under the age of 30, with the total headcount expanding at a rate of roughly 2-2.5% per year. Real estate activity was further supported by interest rate cuts – the Central Bank of Egypt (CBE) lowered benchmark rates three times in 2020 to their lowest level since July 2014 – and mortgage finance initiatives aimed at facilitating homeownership.

Performance & Size

The expansion of the real estate sector has been fostered by a series of largescale infrastructure projects, in a trend that started to accelerate in 2013. The government has prioritised the sector as an avenue for maintaining sustainable economic expansion, especially given the country’s large and growing population – numbering 103.5m as of June 2022 – and high levels of urbanisation.

These factors have put strain on existing real estate stock: in 2020 demand for housing was forecast to reach as high as 700,000 units per year, up from 300,000 units per year in 2014. This surge has been driven by the fact that there is a cultural preference for investment in real estate, as well as the fact that it was seen as a relatively safe investment after economic reforms in 2016 and 2017 led to the depreciation of the pound. The government’s more recent drive to build a series of new cities utilising smart technologies is expected to fuel future demand.

The real estate sector is an important economic growth engine, contributing 11.4% of GDP in current prices in FY 2020/21. It is dominated by the private sector, which accounts for 99% of all real estate activity by value. In current prices the sector was valued at LE687.3bn ($43.7bn) in FY 2020/21, up from LE623.8bn ($39.6bn) in FY 2019/20. In constant prices, it contributed LE415.5bn ($26.4bn) to GDP in FY 2020/21, with the private and public sectors accounting for LE411.3bn ($26.1bn) and LE4.2bn ($266.9m) of the total, respectively. This put the sector up 3.7% from the previous fiscal year, when it was valued at LE400.3bn ($25.4bn) in constant prices, LE396.3bn ($25.2bn) of which was attributed to private sector activities. Its expansion outpaced that of the broader economy, which grew by 2% over the same period, and helped offset some of the losses seen in tourism and manufacturing, which shrank by 26.7% and 6.5%, respectively.

This strong performance was reflected in that of real estate companies, with the majority of those listed on the Egyptian Exchange recording profits in the first nine months of 2021. For example, Talaat Moustafa Group posted a 8% y-o-y rise in net profit, to LE1.7bn ($108m), while revenue was up 8.6% at LE11.3bn ($718m). Emaar Misr, meanwhile, saw its net profit increase by 138.9% in the first three quarters of 2021, from LE1.2bn ($76.2m) to LE2.8bn ($177.9m), while revenue rose by 217% from LE2.4bn ($152.5m) to LE7.6bn ($482.9m). Palm Hills Developments, for its part, registered a 21.7% increase in net profit, from LE536.6m ($34.1bn) to LE653.3m ($41.5bn), with revenue up 63.9% from LE3.6bn ($228.7m) to LE5.9bn ($374.9m).

While the sector was largely able to navigate the economic headwinds associated with the pandemic, it has been affected by increases in the price of construction materials and other factors. In late 2021 investment bank Al Ahly Pharos released a report forecasting a 10% increase in real estate prices in 2022. The bank noted this would come on the back of a 15% increase in the cost of building materials, which were particularly affected by global supply chain disruptions and shipping delays, as well as Covid-19 lockdowns that shuttered factories and suppressed overall demand. A similar report from Arab African Bank forecast that real estate developers would need to increase prices by 9.3% in 2022 in order to maintain profit margins in the face of the rising cost of building materials.


These factors have fuelled investment from private developers such as Emaar Misr, Sakan Developments, Jumeirah Real Estate Investment and Tatweer Misr. In FY 20219/20 investment in real estate reached LE885.2bn ($56.2bn), the majority of which came from the private sector, at LE650bn ($41.3bn), according to data from the CBE. The government, meanwhile, accounted for LE235.1bn ($14.9bn) in investment, with public companies contributing the remaining LE11.4m ($724,400).

The pandemic has put downward pressure on investment in real estate in Egypt, with the total falling to LE611.7bn ($38.9bn) in FY 2020/21. Over that period the private sector invested LE473.8bn ($30.1bn) in the sector, while the government and public companies accounted for LE137.6bn ($8.7bn) and LE25.9bn ($1.6bn) worth of investment, respectively. This figure is set to grow in the coming years, especially as new cities are built across the country.

In June 2021 Egyptian construction firm MBG Development said it has invested LE7bn ($444.8m) in the real estate market, with a focus on the New Administrative Capital (NAC) and the Nile Delta region. Madar Development – which manages projects outside Cairo, as well as on the North Coast and in Ain Sokhna – disclosed in November of that year that it would invest LE22bn ($1.4bn) in the luxury residential segment. More recently, in January 2022 local firm ADVA Developments announced it would invest LE2bn ($127.1m) over five years to build its first project in Sheikh Zayed City.

Regulations & Support

The government is working to streamline the real estate registration process, as well enhance consumer protection and ensure projects come to fruition. In 2020 Egypt enacted the Real Estate Registration Law to encourage owners to register properties, with the minister of justice estimating that as much as 95% of units were unregistered as of December 2020. The government aims to create a digital system that will provide certification to apartments and standalone homes, minimising the red tape associated with registration. It also included new fees of LE500 ($31.77) to LE2000 ($127) for registration. While it was set to come into force in March 2021, that month the authorities announced enforcement would be postponed during a two-year transition period to give government officials additional time to implement procedures and finalise fees. In November 2021 the Cabinet approved amendments to the law, separating tax payments from registration procedures and fees.

Additional measures under the Real Estate Registration Law came into force in June 2022 with a one-year grace period, namely that projects must be built and approved in phases, along with new reporting rules and capital requirements based on project size to increase the likelihood of completion and cover potential refunds in case of delays exceeding two years. This will strengthen the August 2021 directive that developers can only market a project once it is 30% completed; prior to the directive, developers had sold units before breaking ground. While some developers rely on offplan sales to finance projects, the measure is expected to safeguard investment and bolster confidence.

Even as the sector saw positive growth during the pandemic, developers were not immune to the slowdown in real estate sales. In an effort to support liquidity, in February 2021 the CBE issued a series of regulatory changes to help real estate companies manage the economic headwinds brought on by the pandemic. The new rules allow banks to finance the purchase of land by developers: with 95% of land purchased via the government, the amendment will in effect help investors pay off what they owe to the state.

Previous regulations implemented in the early 2000s excluded loans from being used for land sales to deter hoarding and selling at a higher price at a later date. The regulatory changes stipulate that banks guarantee cash flow for the project, and that the company receive down payments from customers and begin construction. The CBE decision permits financing of projects that are jointly managed by public and private entities, conditional on the partners’ creditworthiness, reputation and financial solvency.


The gross leasable space (GLA) of office space in Cairo has expanded in recent years, from 936,000 sq metres in 2015 to 1.1m sq metres in 2019 and 1.5m sq metres in the third quarter of 2021. This figure is expected to triple by 2025, with the supply of office space reaching 4.5m sq metres, according to a 2021 report from property advisory Savills. The market is characterised by a preference for mixed-use parks with office space, retail, food and beverage options, and parking spaces. Office projects in eastern Cairo are also seen as attractive, due to the area’s access to the NAC.

“Following the outbreak of the pandemic, several companies stated that the size of their workspaces would be reduced as more employees work from home. In my opinion, regardless of whether companies reduce the number of in-office staff or remain at 100%, workspace needs will remain the same,” Ashraf Ezz Eldin, managing director of Al Futtaim Group Real Estate, told OBG.

Some 27,000 sq metres and 58,000 sq metres of new office space was delivered in the second and third quarters of 2021, respectively. This figure was set to grow further, with 95,000 sq metres in the pipeline for the final quarter of the year, according to real estate consultancy JLL. However, no new space was added in the first quarter of 2022 and total office GLA stood at 1.7m sq metres. Cairo-wide rents were up 4% that quarter compared to the same period a year prior.

Office rents in Cairo averaged $329 per sq metre a year as of the third quarter of 2021, with the Mohandiseen and Maadi areas having the most affordable rents. Overall office vacancy rates eased slightly, from 9% to 8%. The preference for newer establishments was reflected in neighbourhoods’ average rental costs: Mohandiseen and Maadi had average rents below the city’s average; Downtown Cairo, Heliopolis, Sheikh Zayed City and Smart Village were within the average range; and New Cairo was above average.

While inquiries and transactions slowed in the third quarter of 2021, demand from banks and financial technology companies increased for grade-A office locations like East Cairo. There was also demand from local companies for converted residential buildings and smaller units of 300-500 sq metres, reflective of many firms’ need to cut back on expenditure in light of some of the economic pressures imposed by the pandemic.

Another effect of the health crisis was an increase in the popularity of flexible offices: not only did the market see the emergence of local co-working spaces, but more established firms that had adopted hybrid operations during the pandemic sought to sublease unused units to generate revenue. “This, in particular, is one of the most notable features of the Podium at Cairo Festival City. The Podium offices offer flexible layouts, ranging from 95 sq meters to 1000 sq meters, accommodating different arrangements and ensuring a working environment that caters to various business needs,” Ezz Eldin told OBG.


Cairo is one of the largest retail markets in the MENA region, supported by a young population and a growing middle class. Since reforms in the 2000s opened opportunities to international brands, preference has shifted from street-front shops to organised shopping centres. There has also been a growing emphasis on the shopping experience, with more open-air malls coming on-line and older, more established malls like Cairo Festival City Mall and the Mall of Arabia opening new outdoor spaces. Meanwhile, some developers have begun offering food trucks and drive-through food and beverage outlets, which are seeing higher returns than traditional restaurants.

Retail GLA has grown in recent years due to the expanding presence of shopping centres and the emergence of new areas of development. Around 15,000 sq metres were delivered in both the second and third quarters of 2021, with 57,000 sq metres expected to come on-line by the end of the year and 189,000 sq metres over the course of 2022, according to JLL. Retail rents for primary and secondary malls in the opening quarter of 2022 were up 1% from the year before, and the average vacancy rate held steady at 11%. Retail GLA that quarter stood at 2.9m sq metres.


In recent years, a preference for newer residential areas located further away from the centre of Cairo has emerged. While central neighbourhoods such as Heliopolis, Zamalek and Downtown Cairo were popular in the early 2000s, Egyptians have gradually moved outwards, to areas such as Tagamoua El Khames, 6th of October City, Obour City and El Shorouk. The government drive to build a series of new cities utilising smart technologies – including the NAC and New Obour City outside Cairo, and New Alamein City on the Mediterranean – is expected to continue this trend.

In the first quarter of 2022 there were 231,000 residential units in Cairo, with 21,000 expected to be delivered over the course of the year. Sale prices in neighbourhoods such as 6th of October City and New Cairo rose when compared to the same period of 2021, by 8% and 6%, respectively. Rental rates increased by 2% in both areas. The most expensive neighbourhoods for real estate purchases remained in central Cairo, with the average price per sq metre in Zamalek and Garden City reaching LE20,350 ($1290) and LE17,400 ($1110), respectively, as of late April 2022. The average price per sq metre in the NAC stood at around LE12,250 ($778).

Activity in the segment has begun to recover from a slowdown during the pandemic, even though it has yet to reach pre-pandemic levels. The recovery will be further supported by government initiatives to facilitate homeownership. Private developers are also working to increase demand, partnering with banks to provide mortgage financing for up to 20 years.

The majority of units in central Cairo are apartments, whereas mixed-use developments with grade-A units are more common in the city’s west, as well as New Cairo, El Shorouk and the NAC. Demand for residential units is expected to increase at a compound annual growth rate of 1.4% between 2020 and 2025, with appetite concentrated in the mid- to-high-end segment.

“Pre-pandemic Cairo was experiencing growing demand across all segments, particularly in areas like New Cairo, which is located between central Cairo and the NAC,” Ezz Eldin told OBG. “Despite the pandemic, the underlying dynamics of the market have remained stable, meaning that demand, along with rents and sales prices, have not seen dramatic fluctuations, though flexible payment plans were available in the short term.”

Housing Finance

Real estate financiers more than doubled the value of their loans during the course of the pandemic, from LE3.4bn ($216m) in 2020 to LE8.1bn ($514.7m) in 2021, according to data from the Financial Regulatory Authority. The sharp increase was attributed to real estate’s strong performance, as well as the fact that developers are increasingly partnering with financing companies in order to make the property purchasing process easier for clients.

Financing institutions are looking to capitalise on this trend. In December 2021 Al Taamir Mortgage Finance announced it would increase its annual lending from LE990m ($62.9m) that year to LE1bn ($63.5m) in 2021 and LE2bn ($127.1m) annually through to 2026. They are also working with developers to provide financing solutions. In September 2021 Commercial International Bank announced it would partner with SODIC to provide payment plans of up to 20 years.

At the same time, non-bank players are working to disrupt and better serve the space. In June 2021 Bedaya Mortgage Finance launched the country’s first nonbank mortgage finance app, noting that the segment remains both underserved and underpenetrated.

Central Bank Programme

To promote homeownership, in July 2021 the CBE launched a mortgage initiative to channel LE100bn ($6.4bn) to banks and other mortgage providers to finance the purchase of fully furnished and non-seasonal homes at a subsidised interest rate of 3% for up to 30 years.

Lower-income borrowers – individuals earning LE4500 ($286) per month or households earning up to LE6000 ($381) per month – must pay a 10% down payment on homes worth up to LE350,000 ($22,200). Middle-income recipients – or individuals and families earning up to LE10,000 ($635) and LE14,000 ($890) per month, respectively – must make a down payment of 15% for homes worth LE1.1m ($69,900) and 20% for those worth LE1.4m ($89,000).

These efforts follow a CBE programme in 2014-19, under which those making LE4200 ($267) to LE40,000 ($2540) a month could qualify for a mortgage interest rate of 10%. It also provided LE50bn ($3.1bn) to banks in early 2020 to subsidise loans for middle-income buyers on units of up to LE2.25m ($143,000).


While the aggregate contracted sales of the six largest real estate firms fell by roughly 5.8% in 2020 to LE65.2bn ($4.1bn) – the most significant drop since 2011 – the sector is expected to see expansion in the medium term. The six firms’ aggregate sales are projected to see a compound annual growth rate of 5.2% in 2021-25, according to a March 2021 report by Arab African International Securities. The market is likely to continue its shift towards high-income, mixeduse retail developments that feature outdoor spaces and open shopping. At the same time, office space is projected to expand as foreign companies resume more normal business operations after a brief, pandemic-induced pause in in-person work. Meanwhile, demand for residential units will be concentrated in the mid- and upper-income segments, and a 2021 report from Savills predicted the most growth in West Cairo and New Cairo, with more central areas at capacity.