The company behind the Al-Hayah Resort in Fayoum governorate is looking to extend the usufruct period for the company.
Ahmed Sayed, the owner of Kayan company, said that the current 10-year period of usufruct is not sufficient for investors to realise profits. The Al-Hayah Resort has been established on unexploited land. The company obtained the right to usufruct the Martyr Hassan Abdel Moneim Youth Center in the city of Tamiya in Fayoum.
He told Daily News Egypt that the 10-year usufruct right is the project’s biggest obstacle, as setting up a project at a great cost and high quality needs periods of 20 to 25 years.
This would ensure that the investor can work with confidence in achieving returns on investments, and pump in finance to the project without worry.
Sayed said that taxes and electricity fees reach EGP 20,000 per month, and operating expenses reach as high as EGP 80,000. This means that the total monthly expenses exceed EGP 160,000 in the winter months, and could double in the summer.
He added that he has met with Minister of Youth and Sports Ashraf Sobhy on more than one occasion, with the minister welcoming the proposal to increase the number of years of usufruct.
Sayed noted that he has submitted all the required papers and documents, but no decision has been made yet on his request.
He said that in 2018, the Kayan United Contracting Company was established with a capital of EGP 250,000, provided that new investments would be poured into projects according to need.
The first government project that the company obtained was the Martyr Hassan Abdel Moneim Youth Center in Fayoum, despite the company’s intension to obtain usufruct rights for the Fayoum stadium. The decision, however, marks a general trend towards developing Egypt’s youth centres.
Sayed mentioned that the project is located on 5,000 sqm, and cost EGP 18m before the opening. It consists of two semi-Olympic sized swimming pools, an administrative building, chalets, a wedding hall, cafeterias, and a children’s garden.
The project floors cost EGP 3m, and new development has recently been made at a cost of EGP 3m. Sayed added that in the first two years, the centre is expected to record revenues of EGP 1.6m compared to expenses of up to EGP 2m.
The novel coronavirus (COVID-19) pandemic has caused great losses of nearly EGP 3m. The Ministry of Youth and Sports has waived rents for a period of three months.
Despite this, there are more obligations than the monthly rent of EGP 15,000, such as operating expenses that had to be paid.