City Edge Developments targets EGP 2bn sales this year

Amr El Kady, CEO of City Edge Developments said that the company is developing two projects with total investments of EGP 5.5bn in Sheikh Zayed City. One is residential and the other is a mixed-use establishment located in Sixth of October City.

 

Company plans to launch new project in North Coast next summer

El Kady added that the first project, Etapa, is a residential one located on an area of 77 feddans, with total initial investments of approximately EGP 2bn, provided by self-financing, and the value of the land is fully paid. The first phase of the project launched recently, which has achieved sales of EGP 250m. This phase represents about 10% of the project’s total units.

El Kady noted that the company also plans to launch the second phase next month, which is planned to include about another 10% of the project’s units. We plan to offer other phases of the project throughout the year.

We are aiming to be the first national developer in the local market,

He pointed out that the company has started earth works of the Etapa project, as the company obtained the ministerial approval for the project.

Moreover, building licenses are currently being obtained, which the company expects to receive as soon as possible, especially in light of the facilitations offered by the Ministry of Housing to real estate developers to support the development movement and real estate investment.

He explained that the second project is a mixed-use establishment project on 14 feddans with total investments of EGP 3.5bn. It is a medical administrative project, which also includes an entertainment centre for children. The commercial part of the project will be leased to maintain the quality and activities of the project. Meanwhile, the medical and administrative parts of the project will be sold.

“It is planned to inject investments of EGP 1bn in both projects during the current year, especially with the company’s plan to accelerate implementation rates. The company also aims to achieve contractual sales in both projects of EGP 2bn by the end of 2018. In addition, the company plans to expand its participation in external exhibitions to market the two projects,” El Kady said. “The company plans to launch a new project in the North Coast next summer, in order to diversify its investment portfolio, and we will announce its details when it is launched, which will be a first of its kind.”

The company is aiming to be the first national developer in the local market, based on an ambitious expansion plan and depending on the composition of a strong administrative structure capable of implementing that ambitious plan, according to El Kady.

Regarding his vision to the real estate market, El Kady said” There is great competition in the real estate market in general and in Sixth of October city in particular, especially with the emergence of a range of projects with a high level of excellence recently. In addition, companies are providing different mechanisms of paying installments that are attractive to customers, which makes customers the main element in this competition. “

“Moreover, target customers are divided on all real estate companies operating in the market, especially with multiple options available to them, which is in the interest of clients, who are able to choose from many available choices. Therefore, our company is going to develop its product and marketing mechanisms to succeed in that competition.”

The export of property should primarily target non-Egyptian clients

He believed that the export of property should primarily target non-Egyptian clients in order to obtain hard currency to support the local economy. In addition, studies show that there are several nationalities that prefer to buy property outside their home countries, which encourages real estate investors to compete in providing products eligible for exporting.

As for the most promising cities in real estate investment, he noted that the new cities in general are the most promising, such as cities of New Mansoura and New Alamein, as well as Upper Egypt’s new cities. These areas also includes clients with high purchasing power according to studies and market research, as well as, the previous experiences of developers in these areas support this trend.

Regarding the company’s financing plan for its expansions, El Kady pointed out that all financing choices are available to the company as needed, and it seeks to create a strong management structure capable of achieving the ambitious expansion plan of the company.

City Edge Developments is a partnership between the New Urban Communities Authority (NUCA) owning 60%, the Housing and Development Bank (HDB) with 38%, and the Holding Company for Investment & Development with 2%, with a total capital of EGP 1.3bn. Through providing the best in class standards, the company’s vision is to ultimately be the national brand for premium real estate developments in Egypt.

He revealed that the company plans to participate in the International Property Show in Dubai in April, targeting Egyptian expatriates there, in addition to Arab Gulf customers who want to acquire units in Egypt. Furthermore, granting accommodation for foreigners who purchase property in Egypt is the most important mechanism supporting that trend.

Nevertheless, the presence of the NUCA in the structure of the company gives it great confidence both in the domestic and foreign markets, El Kady said.

City Edge CEO noted that the market has experienced price increases of 30% since the floatation of the Egyptian pound, which does not represent the full increase in the cost of implementation, as developers have borne part of the increase to continue marketing their projects, especially with their depending on marketing as a financing mechanism for the implementation of projects.

Thus, the companies have provided repayment periods of up to 10 years, in addition to lowering down-payments, which sometimes reach 0%, despite the price increases representing a financial burden on the developers who finance the projects and on clients.