CAIRO: After selling just 33 apartments last year, Egypt s Nasr City Housing is stepping up development, selling units before delivery and targeting a wider range of buyers, its chief executive officer said on Wednesday.
Once one of Egypt s leading home builders, the formerly state-run firm, now owned 30 percent by Beltone Private Equity, has settled disputes that held up work on some of its best land and will soon start selling units in a key project.
We sold a lot of land, and now we re changing the strategy, Hisham Akram told Reuters in an interview.
Leaving land as the cherry on top, or cream on top, we need to achieve our sales figures by selling apartments, he added.
The company will start selling units off-plan, or before delivery, in its 3.5 million square meter Nasr Gardens project in the first or second quarter of 2010, pending government approval of its master plan, he said.
Work on the land, near Cairo s airport, stalled for over a decade because of a dispute with the country s aviation authority over the planned height of the development s buildings.
Swiss-based Orascom Development Holding, known for building luxury resorts, is managing the development of Nasr Gardens in return for 2 percent of the project s sales and 10 percent of its profits.
Apartments in Nasr Gardens will likely cost more than Nasr City s old average of LE 3,500 per square meter, as the company targets wealthier buyers, Akram said.
We ve traditionally been servicing the lower B class, he said. We re attempting to service the upper B class, and hence capture more of the B class, with the new project in Nasr Gardens.
Akram said initial estimates put the project s total costs at LE 19 billion and revenue at LE 30 billion, but these numbers would likely change.
The first phase of Nasr Gardens will span between 500,000 and 600,000 square meters, he said.
Akram, one of Beltone s founding members, said the private equity firm took control of Nasr City in 2006 to unlock its value, which mostly meant settling conflicts that had left some of its best land unusable.
It has since resolved a dispute with the Egyptian army over a 5.5 million square meter plot on the outskirts of Cairo known as Kilometer 45. The army had refused to leave the land until someone paid to move the shooting range that lay on it.
In the middle of this year, Nasr City agreed to pay about LE 40 million over several years to relocate the range in a deal coordinated through Egypt s housing authority, Akram said.
Kilometer 45 should be available within six months, he said, adding that the company was looking at primary infrastructure for the land, but will not start building on it right away.
We re not in a hurry, he said. We already have our hands full, and we don t need to open up a new project.