Egypt Real Estate Report Q1 2012
- ID: 1969075
- November 2011
- Region: Egypt
- 58 Pages
- Business Monitor International
Business Monitor International's Egypt Real Estate Report provides industry professionals and strategists, corporate analysts, real estate associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Egypt's Real Estate industry.
Following 2011’s political crisis, BMI's forecasts see trend growth in Egypt settling over the coming five years, as the political transition from authoritarian rule to competitive democracy raises political risks, slows reform momentum and weakens investment inflows. BMI forecasts real GDP to expand by an average 4.2% between 2011 and 2015. BMI is not yet able to fully measure the impact of the political unrest on the rental real estate market; however, BMI's in-country sources reported towards the end of H111 that rents had not been affected by the troubles and grew, for the most part, in each city and in each subsector.
Further rent increases are less likely in the second half of 2011 and into 2012, although BMI may see some – if at a more measured rate – for industrial space. A rise in rents relative to capital values means that yields for retail space have risen since the end of 2010. However, taking the longer-term view, BMI expects yields will remain stable, or fall slightly, as perceptions of the Egyptian business environment improve.
Key opportunities in the real estate market:
- Delayed projects open up even more opportunity for developers to meet the needs of a growing population in a healthy economy.
- BMI is seeing projects underway and tourism picking up again. Egyptian Resorts Company (ERC), which develops mega communities in the country, reported 40-50% capacity by July 2011, up from just 1-5% following the January revolution.
- Significant investment and growth opportunities will emerge once there is more clarity on the political situation. Broadly speaking BMI retains an optimistic view towards the economy’s long-term potential. The key underlying factors predicating this long-term view are robust economic growth allied to strong population fundamentals and an urbanisation rate of 2% a year. Key risks to the real estate market:
- The legal contestation of land contracts runs the risk of delaying projects, criminal charges against the owners of construction firms and the continued tarnishing of the industry’s reputation. Egyptian courts have finally removed a presidential decree that allowed state bodies to sell land and pocket the proceeds, according to Trade Arabia in June 2011.
- A resumption of large-scale protests on the same scale as witnessed in late January would do further harm to the country’s all important tourism sector and hold back the economy’s growth potential. There are many reservations about the short-term outlook of the country.
- The most notable challenges in the near term include the private sector’s lack of access to credit, in addition to an absence of confidence that the current government is capable of steering the economy through ongoing domestic and external headwinds.
- Any long-term impact of the stalled construction pipeline SHOW LESS READ MORE >
Egypt Real Estate/Construction SWOT
Egypt Economic SWOT
Egypt Business Environment SWOT
Real Estate Market Overview
Real Estate Market Analysis
Table: Egypt’s Real Estate Market – Historic Rents, 2010 And 2011 (per m2/month, US$)
Table: Egypt’s Real Estate Market – Net Yields, 2011 And 2012 (%)
Table: Egypt’s Real Estate Market – Terms Of Rental Contract/Lease, Mid-2011
Industry Forecast Scenario
Real Estate Outlook
Table: Egypt’s Real Estate Market – Rentals, 2011 And 2012 (per m²/month, US$)
Table: Forecast Yield, 2008-2015 (%)
Construction And Infrastructure Forecast Scenario
Table: Egypt Construction And Infrastructure Industry Data, 2008-2016
Egypt - Economic Activity, 2008-2015
Table : Egypt Business Environment Ratings
Table : Middle East And Africa Real Estate/Construction Business Environment Ratings
Egypt’s Business Environment
Table: BMI Business And Operation Risk Ratings
Table: BMI Legal Framework Rating
Table: Labour Force Quality
Table: Middle East and Africa – Annual FDI Inflows
Table: Trade And Investment Ratings
Table: Top Export Destinations, 2001-2009
Egyptian Resorts Company
Nasr City Housing and Development
Orascom Construction Industries
Palm Hills Development
Saudi Egyptian Construction Company (SECON)
How We Generate Our Industry Forecasts
Real Estate/Construction Business Environment Rating
Table: Weighting Of Indicators
- Egyptian Resorts Company
- Nasr City Housing and Development
- Orascom Construction Industries
- Palm Hills Development
- Saudi Egyptian Construction Company (SECON)
- TMG Holding