How the GEM is reshaping West Cairo’s real estate investment map: The inauguration of the GEM has been whetting the appetite of real estate developers, with developers increasingly looking to secure licenses for the surrounding areas in recent months, a government source told EnterpriseAM. Those interested in setting up new developments and hotels are looking primarily at land plots adjacent to the museum, or in areas overlooking the pyramids, as well as in October Gardens and Sheikh Zayed City, according to our source.

The government is currently working on re-planning the area, which includes — among other things — repricing land designated for investors, with land allocation priority going towards tourism investments over conventional urban development. The strategy also entails tapping qualified and experienced companies to establish large-scale projects in the vicinity, our source tells us.

A proposed administrative zone is also under review, earmarked for service and administrative projects targeting international companies looking to establish headquarters in the area.

High-end hospitality takes center stage: There are already clear signs of the investments pouring into the hospitality sector, including Talaat Moustafa Group’s (TMG) Icon, which announced earlier this month its plans to set up a new USD 788 mn luxury tourism project behind the GEM. The project, due to open its doors within three years, will include a 495-key Four Seasons-branded hotel, along with serviced residences and a commercial area. The GEM’s opening was the primary driver behind this extensive regional development, Icon said, with the company expecting the area to become a global cultural and tourist destination in the next few years.

At the same time, Arabia Developments is racing to finish building the EGP 16 bn, 500-key Fairmont at its Sun Capital project in October Gardens, company sources told EnterpriseAM. The hotel is scheduled to open its doors in 2028 and will be part of the wider EGP 30 bn Sun Capital project, which overlooks the pyramids. The project also includes another building with Fairmont-branded and managed hotel apartments — a first for the hotel brand in Egypt.

Market dynamics are shifting…: The GEM’s opening is a game changer for Egypt in several respects, including boosting our standing as an international cultural and tourist destination, and encouraging more investments in real estate, hospitality, and tourism across the capital and in West Cairo in particular, Chairman of the Federation of Egyptian Industries’ Real Estate Division Tarek Shoukry told EnterpriseAM. The expected influx of tourists is going to help drive significant added value for surrounding land plots and projects, with the area set to become a new residential, entrepreneurial, and investment hub, Shoukry said.

… and prices will follow: Real estate prices have already been impacted by the opening of the GEM, with the prices of ready units in the area rising as much as 50% due to the buzz surrounding the museum’s inauguration, Thiqa Real Estate Valuation Chairman Mohamed El Dahshoury told us. However, the spike in prices is likely temporary, with El Dahshoury expecting the appreciation in land and home prices to stabilize somewhere between 25-30% next year. Beta Egypt for Real Estate Investment Chairman Alaa Fikry, meanwhile, suggests that land prices — which were set some time ago — already factored in the presence of the GEM, and therefore should not rise again significantly. However, El Dahshoury notes that areas like Hadayek Al Ahram previously saw several price spikes around previous expectations of the GEM opening its doors.

All of this will get a helping hand as the government continues to focus on infrastructure spending — including new road networks linking West Cairo to the city center — which will make the area all the more appealing to real estate and tourism investors.

Hotel apartments are going to be the name of the game: With the area surrounding the GEM becoming a premier tourist attraction, new real estate developments need to dedicate substantial space to hotel apartments and serviced housing to account for the rising demand in the area, Fikry told us. Where possible, developers are likely to develop a full-fledged hotel to capitalize on tourist interest, Fikry said. El Dahshoury agreed, telling us that developers are moving towards bringing more hotel apartments online near the pyramids, particularly amid high occupancy rates and substantial demand. This trend is also pushing up real estate prices as several projects are being converted into highly valued hotel accommodation.

The rest of the city needs to be prioritized, too: Officials should think about how to maximize tourism income across the city, rather than focusing solely on West Cairo and the immediate area surrounding the GEM, El Dahshoury stressed. While many tourists flock to the pyramids and nearby attractions, those who choose to stay in areas further away from major attractions tend to spend more, he noted, suggesting that there’s a way to capitalize on this by marketing all hotels and serviced apartments across the city.

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