Egyptian real estate developer Palm Hills Developments will raise its stake in Maccor for Securities Investment Company to 60 percent, the daily Al-Mal said on Tuesday.
Palm Hills had bought 52 percent of Maccor, which has stakes in firms that own a total of 762 hotel rooms, for LE 141 million ($25.6 million) earlier in the month.
“Palm Hills is looking to increase the capacity of hotels under Maccor from 762 to 1,300 rooms within 18 months, and then to 3,500 rooms by 2015,” Al-Mal quoted Palm Hills Chairman Yasseen Mansour as saying.
Palm Hills is expanding into the hotel sector to soften the impact of the volatile real estate market. Revenues from hotels as well as commercial and administrative units should generate around 30 percent of Palm Hills’ revenues by 2015, the paper quoted Mansour as saying.
Many of Egypt’s real estate firms do not recognize revenue from a sold unit until construction is all or partly complete, a process that can take more than four years after the contract is signed.
A number of Egyptian developers have moved into store and hotel ownership to secure steadier income.