Madinet Nasr for Housing and Development (MNHD) owns a number of real estate projects, including a 45km area on the Cairo-Suez Desert Road, Tigan, Al Waha, Primera, and Nasr Gardens.
The company’s paid-up issued capital stands at EGP 375m, divided across 375m shares with a nominal value of EGP 1 each. The shares are traded on the Egyptian Exchange at EGP 14.4.
Ahmed El Hitamy, managing director of MNHD, spoke to Daily News Egypt about the company’s expansion and investment. He said that MNHD seeks to diversify its projects in the coming period, through launching non-residential, commercial, and tourist projects in several areas nationwide.
The company plans to secure EGP 900m in investments for Sarai’s first phase after the company managed to sell all the units in just 48 hours at EGP 815m.
What are the latest developments in the company’s acquisition of financing from banks?
The company is about to complete negotiations with banking alliances to borrow EGP 2bn to be repaid within eight years, at a variable interest rate, as the company cannot afford the high interest rates in the coming years.
The company will obtain the loan in early 2017, from which EGP 600m will be allocated to Tag City and EGP 900m to the Sarai project.
How much did the company register in sales?
The company achieved EGP 3.5bn in sales, compared to the targeted sales of EGP 1.5bn in 2016.
The company will review its targeted sales in 2017, after the great success of this year.
What is the company’s expansion plan?
The company plans to launch K-Zone, a new phase of Tag City, during the first half of 2017; it will be larger or similar to T-Zone.
The company has succeeded in reaching the highest levels of sales in this region during the current period, as compared to its competitors.
How much are construction costs for the company’s projects?
The company takes into account the cost differences when calculating the profit margins. We issued the project’s price list after the appreciation of the US dollar on the informal market and the flotation of the Egyptian pound. The cost of land per metre in Tag City is EGP 11,000-12,000, up from EGP 9,000.
The construction cost of Sarai project amounted to EGP 1.1bn, but we have not yet concluded the project’s licences. The loan contract signing is scheduled for the beginning of 2017, while the project will be delivered within four years.
This phase of Sarai project is on an area of 220,000 sqm. It includes about 1,300 units ranging from 120 to 240 sqm.
What are the challenges facing Sarai project?
Ehab Reda, the manager of Sarai project in New Cairo, faces major challenges in the current period. The project is just 25km from Tag City in East Cairo.
We face competition among real estate developers in the same area, such as Al Ahly for Real Estate Development (Sabbour) and ARDIC for Real Estate Development (Zizinia).
When will you propose the tenders for the Sarai project?
The company will offer the tenders for Sarai within four to six months, and the delivery of the project will begin within four years.
The company has achieved high sales records; the cost per metre of land in Sarai is considered the highest among other projects in the region.
When will the company issue its Global Depositary Receipts (GDR)?
The GDRs are scheduled to be issued in the second quarter of next year.
What are the developments of the company’s decision to postpone the collection of Primera project’s instalments?
The next meeting of MNHD’s board of directors will decide whether to approve the postponement of the collection of instalments for the Primera project, located in El Waha project in Nasr City, or to refund the collected sums for those who wish to do so without any fines.
The project is currently stalled, upon the neighbourhood management’s decision due to a disagreement on the ownership of a part of the land. The total collected money for this project is estimated at EGP 122m.
Does the company intend to increase its real estate portfolio in the coming period?
The company seeks to add new areas to its real estate portfolio, amounting to 9.5m sqm in Cairo and other governorates.