The real estate sector in Egypt has shown remarkable resilience despite the broader economic challenges, such as high inflation and exchange rate instability. According to Property Finder’s Market Watch Q2 2023 report, the sector grew by 22% YoY in Q4 2022. This reflects the positive momentum and substantial contributions of the construction and real estate activities sectors to Egypt’s economic performance.
Egypt’s real GDP recorded a 3.9% growth in Q1 2023, mirroring the growth observed in the preceding quarter and the positive effects of sectors such as tourism, agriculture, and construction on Egypt’s GDP.
The residential and mixed-use real estate sector achieved a significant number of ongoing projects, with a total of 534 projects worth $329,575m. These projects represented approximately 50% of the total number of projects and 75% of the total investments. The governmental development stretches across 13 different governorates, while the private sector’s activity is at 20 governorates. Cairo and Giza governorates have the highest contribution of almost 80% of the total investment of the private sector.
The Suez Canal Economic Zone has been a major driver of governmental investment in Egypt, accounting for almost 80% of the total governmental development. This is due to the industrial and commercial development in the areas surrounding the canal.
The capital, Cairo, is where most of the residential real estate investments take place, representing approximately 57% of the total investment.
The New Administrative Capital, which is a huge project that aims to create a new urban hub, has a share of approximately 44% of the total investments in Cairo.
Giza governorate, which is adjacent to Cairo, has also witnessed significant residential real estate investments, reaching approximately 16% of the total. These investments are distributed across seven different areas and communities, with October City and Sheikh Zayed City having the largest shares of 61% and 21%, respectively.
Egypt has a large number of ongoing real estate projects across 21 governorates, which are at various stages of development. According to the report, about 54% of these projects are halfway through their completion, while 13% of them are in the final stages of completion, with over 90% of the construction already finished. Another 17% of the projects are between 75% and 90% complete.
In Cairo, 62% of the projects are halfway through the construction process, 14% are in the final stages of completion, and 28% are between 50% and 75% complete. Giza has 20% of its projects in the range of 75% to 90% completion.
However, the number of newly launched real estate projects in Egypt has declined significantly by 60% compared to Q2 2022. This can be attributed to the rising costs of construction, which have been observed since Q4 2022. Despite this, Q2 2023 witnessed the start of construction for about 34 projects in eight different governorates.
Egypt witnessed a notable increase in the delivery of real estate projects in Q2 2023, with a total of 11 projects worth $875m. This represents a 19% increase in the volume of the projects and a 46% increase in the value of the projects compared to Q2 2022. Most of these projects were located in Cairo and Giza, which are the two largest governorates in Egypt. Cairo had 36% of the delivered projects, worth 28% of the total investment, while Giza had 27% of the delivered projects, worth 37% of the total investment. The projects in Cairo were distributed across four different areas: Mokattam, Mostakbal City, New Administrative Capital, and New Cairo. The projects in Giza were mainly concentrated in the 6th of October and Sheikh Zayed cities.
The New Administrative Capital was the most prominent area for real estate investment in Egypt, with 25% of the total investment in Q2 2023. The New Capital had 97 ongoing projects with a value of $68,528m, which are expected to transform the city into a new urban hub. The governmental investment accounted for 74% of the total investment in the New Capital, with 34 projects, while the private sector accounted for 26% of the total investment, with 63 projects.
