The Real Estate Investment Division at the Federation of the Egyptian Chambers of Commerce (FEDCOC) has prepared a memorandum asking the parliament to solve the high lending interest rate issue that has added to the burden on real estate companies that bought pieces of land from the New Urban Communities Authority (NUCA), according to Mamdouh Badr El-Din, head of the division.
Badr El-Din said that the Central Bank of Egypt’s (CBE) decision to increase the instalment interest rate may affect the building rates in real estate projects, not to mention the other challenges represented in high prices of raw materials.
He added that this memorandum will also be sent to NUCA and the Ministry of Finance to find a solution to the crisis.
The Real Estate Investment Division has called on companies suffering from the high lending interest rate to send details of their problems via e-mail to the division, so as to review all cases working under different contracts.
In response to a question about the initiative launched by the division for the implementation of social and middle-class housing units, Badr El-Din revealed that Minister of Housing Mostafa Madbouly has approved the initiative. He added that the ministry’s share of the social housing units will represent 30%, in exchange for granting the lands to real estate companies.
The ministry is expected to sign the initiative protocol within a week, while the division still waits for NUCA’s approval to allocate pieces of land for the expansions of Sheikh Zayed City, Badr said.
NUCA had approved the allocation of 2,000 acres for expansion in 6th of October City in order to implement social housing units under this initiative. The cabinet also approved the implemention of social housing units in new cities through real estate investment companies.
NUCA will allocate several pieces of land on areas of 50-100 acres for each real estate developer to establish his housing project in exchange for building other social housing units in accordance with the same specifications followed in the Ministry of Housing.