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Developers take a stance against new fees on North Coast projects: Seventeen real estate developers have appealed against the newly-introduced fees on projects in the North Coast, a government source told EnterpriseAM.
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ICYMI- Local and foreign developers with projects in the North Coast were hit with new fees over the summer — local developers are charged a standardized EGP 1k per sqm fee on land used for tourism developments, while foreign developers face a flat USD 20 per sqm fee.
Developers are pushing for reductions in the fees imposed, so they can settle them and proceed with their licensing, marketing, and construction activities, several real estate developers told EnterpriseAM. Very few companies have complied with the payment schedule, the government official told us.
To sweeten the pot: Local developers will be required to settle on 20% of their total due upfront, with the rest paid over five years. These are more lenient terms than those imposed on developers on the Cairo-Alexandria Desert Highway and along the Dabaa Axis, who have to settle 50% upfront and the rest over three years.
Who owes what: Thirty-three companies are required to pay the new fees on a total of 50 land plots. Emaar Misr is required to pay EGP 2.7 bn, SODIC was slapped with a EGP 4 bn bill, and Palm Hills is required to pay EGP 2.5 bn in fees.
Some companies are saying they will not significantly increase prices at their projects, despite the government fees, including Intro Group’s real estate arm M squared, according to comments from CEO Karim Malash at a press roundtable attended by EnterpriseAM. The developer faces EGP 500 mn in fees on its North Coast project Masyaf Ras El Hekma, Malash said, adding that the company already paid 20% upfront and will respect the instalment schedule set by authorities.
The clock is ticking: Developers have until 20 September to start settling their dues, the government source told us, adding that the government could push back the deadline in efforts to prompt more companies to settle their payments.
IN OTHER REAL ESTATE NEWS-
A new real estate player enters the scene: Newly-established real estate developer One of One acquired four land plots in East and West Cairo, under a EGP 150 bn investment plan, according to a press release (pdf). The developer acquired a plot in Sheikh Zayed, which it will turn into an integrated administrative and commercial hub, a plot in Sixth Settlement, which will become a fully integrated residential development, a plot in New Zayed, and another in New Sphinx.
