Head of Real Estate Export Council Hesham Shokry stated that the global real estate export market trades $300bn annually, half of which are real estate funds and the second half are individuals or small investors.
Shokry said that the global real estate assets reached $4trn, of which 60% are owned and managed by real estate funds, noting that “whoever wants to create a strong real estate in Egypt must have funds, and unfortunately we do not have real estate funds in Egypt.”
He added that MIPM exhibition in France, the largest real estate conference and exhibition in the world, is considered the first stop for those who want to put themselves on real estate export map because it represents the largest gathering of real estate funds in the world, as there is no strong real estate industry in a country without presence of property funds.
He further revealed that when the Real Estate Export Council was established, two studies were conducted, a study for a specific vision for the export of property, and another integrated study of challenges and their solutions since 2018 but no response.
He pointed out that the law concerning granting nationality in return for buying property in Egypt when it was issued had a problem, which is that residency and nationality are granted to a foreigner when he buys real estate from a government agency or a public legal entity.
Head of the Real Estate Export Council highlighted that the most important problems are property funds, and stressed the need to amend executive regulations.
He disclosed, “There are 860 real estate funds worldwide, and we in Egypt do not own any fund, and therefore it is not possible to claim export property because real estate funds always deal with projects with fixed periodic returns, and there are specialised real estate funds at the global level in the last ten years in terms of health and education. Meanwhile, we in Egypt have no awareness of their importance in Egypt, but investment funds in the world have taken care of health and educational buildings.”
He elaborated that foreign real estate funds will not enter the Egyptian market because there are no Egyptian real estate funds. The existence of real estate funds must be activated, the executive regulations must be amended and problems related to them must be overcome, and large financial institutions must be encouraged, in cooperation with banks in Egypt, to establish real estate funds as a first step to attract foreign real estate funds. There are real estate funds in more than 40 countries in the world, including African countries in Nigeria and South Africa.
He called for registering the property so that developers can export it abroad; pointing out that no foreign real estate fund will approach the Egyptian market as long as there is no registration.
He pointed out that solutions can be found away from real estate registry, and it can be done through the state authority of the land, as the foreign investor does not care about the name of the real estate registry, but all that matters is the existence of an authority approved by the state that registers.
Furthermore, he explained that when establishing any project in new cities, the state authority owns the ministerial approvals and it has plots of land, buildings, licenses and everything related to the project, so the contract becomes documented by the state, and this will satisfy foreigner and real estate funds to support real estate export.
Shokry also called for issuing a law related to the real estate developers federation, explaining that despite the huge real estate market and the volume of investments in this industry and the number of developers present, there is no federation.The federation is a first step to regulating the market and for developers to have a federation that is addressed and spoken on their behalf and officially represents this profession and they can talk with the government, he concluded.