Egyptian economic expansion to stabilize to around 4.5% between 2021, 2022: Savills Egypt

CAIRO – 16 June 2021: The Egyptian economic expansion will moderate to around 4.5 percent between 2021 and 2022, but, starting 2023, GDP growth is likely to return to its pre-pandemic rates of above 5.5 percent, Head of Savills Egypt, Catesby Langer-Paget stated Tuesday.

“We can very much see the impact of Egypt’s economic expansion on the real estate market, as the market is maintaining its position and is regarded as an attractive investment. Also, one should note that the decrease of interest rates in the market is positioning real estate assets as the safe haven for investments across the country, driving demand for local investors, Egyptian expatriates as well as foreign investors,” Langer-Paget added.

Savills, one of the world’s leading real-estate consultancies, launched its first Egypt Property Report. This report offers a comprehensive look at the Greater Cairo real estate market, with in-depth analysis of the residential, offices and retail sectors.

During a press conference to announce the release of the Savills Egypt Property Report, Langer-Paget said: “Marking our third year in Egypt, this report will be the first of many, as this industry continues to thrive and develop. Globally, we release hundreds of reports annually from our 650 global offices, which real estate professionals and investors rely on for current market trends and predictions for the future to help make the right decisions.”

In addition, Head of Operations at Savills, Sherine Badreldine explains: “Reports show that the real estate market is maintaining its position and even growing in some sectors; as in the case of the residential market where demand for units has remained strong across Greater Cairo, bringing the current residential stock to 7.1 million units. Furthermore, following the government’s expansion vision and the Egyptian New Urban Communities Authority (NUCA), private developers are offering a variety of large mixed-use developments across both West Cairo and New Cairo, leading to a strong increase in the supply of Grade A residential developments, accounting to around 1.0% of the total supply in 2020.”

Badreldine added: “The same applies for the office market: the demand for office space remains strong and is gradually increasing on an annual basis across Greater Cairo. There has been a steady growth in the number of foreign corporations recently establishing their operations in the city or expanding their footprint.”

Finally, Zeinab Adel, Head of Strategic Consultancy at Savills explained: “The upcoming years will continue to witness an increase in residential demand driven by population growth. For the office market, the demand for office space remains strong, nonetheless, patterns of supply and demand within the key office hubs are changing. With a current office supply stock of 1.7 million sqm (end of 2020), developers are preferring to move away from Downtown Cairo and Giza towards mixed-use organised office parks, that offer a variety of amenities and sufficient parking space in Sheikh Zayed City and New Cairo.”
 

Adel concluded that the report also linked the change in the retail sector to the change in demographics due to a growing and affluent Egyptian middle-class youth. This shift has been more prevalent in the last few years, especially in 2019, with the significant increase in the city’s retail GLA with the handover of Mall of Egypt and Almaza City Centre, in addition to retail strips in New Cairo and the expansion of Cairo Festival City