The UAE-Egypt Affair: Behind the scenes of Cairo's $40 billion housing initiative
Egypt's parliament approved plans for the $40 billion housing initiative earlier this week (File Archive/AFP)
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Dubai's leading engineering and construction group Arabtec Holding has signed an historic agreement with Egypt’s Defence Ministry to develop and construct one million housing units in a project worth 280 billion Egyptian pounds ($40.23 billion).
The construction work was scheduled to begin in the third quarter of this year. The first batch of units will be delivered in early 2017 while final delivery of all units will be achieved before 2020, said the Dubai builder in its statement.
The agreement was formalised yesterday (March 9) at a ceremony attended by Field Marshal Abdel Fattah Al Sisi, Deputy Prime Minister, Defense Minister and Commander-in-Chief of the Armed Forces, alongside a number of senior officials, as well as Hasan Abdullah Ismaik, the managing director and CEO of Arabtec Holding and other senior executives.
Commenting on the deal, Ismaik said: “Egypt is held in high regards by the leaders and citizens of the UAE. The two countries are linked together by historic bonds of fraternity and friendship. We at Arabtec are proud to join the efforts of the UAE government aimed at further consolidating these bilateral ties."
"This historical project, the biggest of its kind in the region, will be a major boost to the Egyptian economy and will help improve the living standards for the Egyptian people," he added.
As part of the memorandum, Arabtec’s subsidiaries will develop and construct one million housing units in thirteen locations across Egypt.
This move is in line with the efforts by the Egyptian authorities to provide affordable housing for the country’s growing population.
The project, which is the biggest of its kind in the region, will be a boon to millions of Egyptians who will have access to full-fledged communities, with public amenities such as schools, hospitals, parks and places of worship.
Arabtec Real Estate, a recently formed subsidiary of Arabtec Holding, will undertake the development of this project, which will be developed in phases over a span of five years.
This project is the first in a series of projects that Arabtec looks to undertake as part of its efforts to expand its presence in Egypt.
ArabtecEgypt for Construction, a subsidiary of Arabtec Holding, will undertake the construction work of the project which is expected to create more than one million jobs for the people of Egypt.
The developments will be funded, in the most part, by a number of Egyptian and foreign banks. These banks have already expressed interest in providing a range of affordablefinancing solutions that will appeal to a broad cross-section of the Egyptian population and includes long-term repayment of up to 20 years, said the Dubai builder.
These residential communities will be developed in 13 locations in a number of governorates with an overall land area of over 160 million sq m, of which 149 million sq m will be in Cairo governorate (Al Obour, 10th of Ramadan, Badr, and Al Ikhlas).
The rest are divided between the governorates of Alexandria (Burj Al Arab City – 964,000 sqm); Maanoufiyah (Sadat City – 2,880,000 sq.m); Fayyoum (Fayyoum New City – 2,200,000 sq.m); BaniSuwaif (BaniSuwaif New City – 864,000 sq.m.); Al Menyah (New Al Menya City – 1,640,000 sq.m); Asyout (New Asyout City – 900,000 sq.m); Souhag (New Souhag City – 1,160,000 sq.m)’ Qana (New Qana City – 264,000 sq.m); and Luxur (New Taybeh City – 328,000 sq.m.). The overall built area of these communities will be in excess of 5 million sq.m.
Arabtec chief said the Egyptian economy was poised for a significant rebound, particularly with the current governmental policies geared towards encouraging investment in the property development sector.
"The Egyptian market holds high potential, particularly in the affordable housing sector, and we are determined to take advantage of these opportunities by launching a number of projects that will help meet the ever-mounting demand for housing units in Egypt," stated Ismaik.
Arabtec said it was in the final stages of signing definitive agreements with the Egyptian authorities on key issues, including mechanisms for the implementation of the projects