CAIRO / EMIRATES BUSINESS
Egypt’s Sixth of October Development and Investment Company (Sodic) and Heliopolis Development Housing (Heliopolis Housing) have signed a co-development contract for a major mixed-use scheme in Cairo.
Sodic will develop 70 per cent and 69.8 per cent of the residential and commercial units respectively, while Heliopolis House will develop the rest, according to a company statement.
The project, which will be developed over a period of 10 years in east Cairo, is expected to cost about $3.8bn.
The statement went on to say that the scheme will create 40,000 direct and indirect jobs over the course of its development.
Sodic participated in Heliopolis Housing’s most recent land auction as part of its strategy to increase its land bank and pursue new opportunities for growth, according to a company spokesperson speaking on the sidelines of a conference in Cairo. The co-development deal marks Sodic’s first revenue-sharing venture.
In September last year, Sodic was awarded about 125,500 square metres of land in 6th of October City, west of Cairo. The company also signed an agreement with the local Holding Company for Water and Waste Water, as well as with German Agency for International Cooperation (GIZ) for the rehabilitation of 1,000 homes within inner city slums.
Several major schemes have been announced in the past year, and with Egypt’s continued need for foreign investment to finance these projects, real estate analysts are expecting a number of legislative changes to encourage foreign and private involvement.
The development of the New Capital City provides a massive opportunity for foreign developers and real estate firms within Egypt. The master project could help relieve some of the pressure on the existing urban area in Cairo.
Egypt saw a total of 7,560 residential units delivered in Cairo throughout 2015, compared with the scheduled delivery of 30,000 units forecast by developers at the beginning of 2015, representing a materialisation rate of just 25 per cent, according to a report by US-based property consultancy JLL.