JLL’s ninth Global Real Estate Transparency Index (GRETI) revealed that Egypt has moved up in the rankings to join the semi-transparent category for the first time in the JLL and LaSalle Investment Management’s 2016 GRETI.
The index revealed that Egypt now ranks 65th, pushing it up to fourth place in the semi-transparent group.
Large emerging markets dominate the semi-transparent group, including the BRIC countries Brazil, Russia, India, and China and all four of the fast-growing MIST economies Mexico, Indonesia, South Korea, and Turkey.
The semi-transparent category includes 37 countries out of 109 markets, where Egypt comes in the fourth place of the category and Dubai in first.
The index revealed that Saudi Arabia also moved into the dynamic semi-transparent group and is ranked 63rd.
Meanwhile, Dubai has retained its position as the most transparent real estate market in the Middle East and North Africa (MENA) region and ranks 48th, with Abu Dhabi ranking 59th, according to the report.
Egypt has continued to improve since 2014, moving up to fourth place within the MENA region over the past two years, said country head of JLL’s Egypt office Ayman Sami.
Sami added that Egypt is now positioned in a very dynamic tier, which is considered the most improved transparency group, and in a category that is seeing growing middle classes mobilising against corrupt practices.
The index includes five tiers of GRETI: highly transparent, which includes 10 countries; transparent with 20 countries; semi-transparent with 37 countries; low transparency with 21 countries; and opaque, which includes 21 countries.
Sami noted that the progress in Egypt can be attributed to the a new political roadmap, which has seen the introduction of a new constitution. The government has implemented a number of initiatives to enable greater real estate transparency. These include facilitating the mortgage process for a wider segment of the population and providing more transparency in the allocation of government housing.
“While transparency has improved, the real estate sector continues to face a lack of quality information on performance and future supply. This is hindering the attraction of the Egyptian market for investors and adding to the general uncertainty surrounding the value of the local currency,” Sami said. “We understand that the government is exerting major efforts to improve the transparency level of the market as part of its overall effort to attract further foreign investment into the real estate sector over the next few years.”
JLL said that capital allocations to real estate are growing with further forecasts that an amount of $1tn will be targeted within the next period, compared to $700bn in the current period.
JLL noted that this expected growth in the sector means investors are demanding further improvements in real estate transparency, expecting standards in real estate to be on par with other asset classes.
JLL believes that transparent real estate practices play a significant role in capital formation and municipal finance. The transparent practices promote security of property ownership, safe housing and workplaces, and the ability to trust agents to act honestly and professionally.
The JLL Global Real Estate Transparency Index is based on a combination of quantitative market data and information gathered through a survey of the global business network of JLL and LaSalle Investment Management across 109 markets in 2016, up from 102 in 2014.
JLL is a professional services and investment management firm offering specialised real estate services to clients seeking increased value by owning, occupying, and investing in real estate. JLL MENA employs over 220 internationally qualified professionals embracing 30 different nationalities across its offices in Dubai, Abu Dhabi, Riyadh, Jeddah, and Cairo.