Egypt intends to put 31% of “Upper Real Estate” for sale

An Egyptian official said that the Egyptian government intends to offer a 31% stake in the Upper Egypt Tourism and Real Estate Development Company to the private sector, adding that international investors have expressed interest in acquiring the stake.

The official added, during statements to “Bloomberg”, today, Sunday, December 3, 2023, that the government has already assigned the determination of the market value of the share to the management of the National Bank of Egypt, which is one of the shareholders in the ownership of the company, but he did not mention any estimates of the value of the share.

Offering the share to foreign and Arab investors

He said: “The share to be exited represents the share of the Holding Company for Tourism and Hotels and its subsidiary EGOTH, which are two state-owned companies affiliated with the Ministry of Public Business Sector.”

He explained that the ownership of Upper Egypt for Tourism and Real Estate Development is distributed at a rate of 21% to the Egyptian General Company for Tourism and Hotels “Egoth”, 10% to the Holding Company for Tourism and Hotels, 29% to the National Bank, 20% to the Bank of Egypt, and 20% to the Upper Egypt Investment Company, which is fully owned by the public sector.

He added that the share will be offered to foreign and Arab investors who own distinctive brands in the tourism and real estate development sectors, and who have expressed a serious desire to acquire the share and other shares in the ownership structure, but he refused to disclose their identity.

Selling Egyptian property abroad

On another level, Dr. Ahmed Shalabi, Chairman of the Egyptian Real Estate Council and CEO of Tatweer Misr, said that the initiative to sell Egyptian real estate abroad for dollars, which was announced as being approved by the government, has been discussed for some time through the Egyptian Real Estate Council because it is a great opportunity for the dollar to enter through Egypt’s official channels.

The head of the Egyptian Real Estate Council added, that 50% of the sales of real estate development companies this year were made outside Egypt, 39% of which were to Egyptians abroad and 11% to foreigners, and that the 20 largest companies in the market had their sales since... The beginning of the year reached 446 billion pounds, and it is expected that the sales of real estate development companies by the end of the year will reach one trillion pounds.

Challenges facing the real estate sector

The CEO of Tatweer Misr pointed out the major economic challenges facing the real estate sector since 2016, which led to great awareness among developers and thinking about the mechanisms of the hedging process. The company took many hedging measures against crises, and among these mechanisms was the presence of raw material stores worth... Up to 500 million pounds, in addition to accelerating construction operations, and keeping a percentage of each stage of the project of 10-15% and not selling it, and it will be sold later to compensate for any future losses.

The head of the Egyptian Real Estate Council pointed out that exporting Egyptian real estate is considered a priority and part of the state’s plan to achieve $100 billion in exports.