Egypt Gas to help supply gas to Jordanian industrial zone

Wednesday, 30 Oct 2024

Egypt Gas to help supply gas to Jordanian industrial zone

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Today at a glance

Manufacturing

Sumitomo Electric’s pigtail cable factory in Tenth of Ramadan nears completion.

Energy

Egypt Gas to help supply Jordan’s Quweira Industrial Zone with natgas.

Healthcare

Vezeeta announces new innovation hub, Visa and Nymcard partnership, regional expansion plans.

EARNINGS WATCH

SODIC reports highest ever quarterly sales + Mashreq reports 9M earnings.

Also on our Radar

AngloGold to acquire Centamin next month.

PLANET FINANCE

HSBC reports strong 3Q results + plans a fresh USD 3 bn stock buyback.

HARDHAT

Could serviced apartments act as a growth driver in Egypt’s property sector amid changing market dynamics?

What We're Tracking Today

Egypt’s Madbouly delivers speech at KSA’s Future Investment Initiative forum

Good morning, ladies and gentlemen. We have a busy issue for you this morning as we race towards the end of another week.

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MADBOULY AT KSA’S FII FORUM-

Madbouly talks development and geopolitics at “Davos in the Desert”: Prime Minister Moustafa Madbouly delivered a speech on behalf of President Abdel Fattah El Sisi during the opening session of the Future Investment Initiative (FII) conference in Riyadh — often referred to as “Davos in the Desert” — where he focused on pushing forward development amid regional strife, according to a cabinet statement.

Madbouly presented Egypt’s four-pronged development strategy: Madbouly’s speech revolved around Egypt’s approach to securing sustainable and inclusive development, with a particular focus on empowering the private sector and further developing our energy sector, transport and infrastructure networks, and telecom and CIT industry. In particular, the PM highlighted our plans to diversify our energy sources, become a regional energy hub, capitalize on our geographical location in transport and logistics networks, and realize the potential benefits of AI.

Geopolitics was also among the key talking points: Madbouly emphasized Egypt and Saudi Arabia’s shared role as “the main pillars of security and stability in the region,” saying that “the security of the Gulf states is an integral part of Egypt’s national security.” The PM also reiterated the two nations’ shared stance on the crisis in Gaza, emphasizing the need for a ceasefire agreement and the establishment of a Palestinian state.

Madbouly held a number of bilateral meetings on the sidelines of the event, including a meeting with his Vietnamese counterpart Pham Minh Chinh that saw the two sides discuss boosting trade and investment ties. The PM also met with the FII Institute’s CEO Richard Attias and Kuwaiti Finance and Economic Affairs and Investment Minister Noura Al Fassam, according to a separate cabinet statement.

** You can find out everything you need to know about the forum in a rundown of theevent that EnterpriseAM KSA published yesterday and check out today’s issue of EnterpriseAM KSA for its recap of day one of the event.

HAPPENING TODAY-

#1- Supply Minister Sherif Farouk is in the Jordanian capital to attend a forum on Accelerating Food Systems Transformation in the Arab Region jointly organized by the Jordanian government and UN organizations, according to a statement. The two-day forum, which begins today, will discuss strengthening food security in the region and bilateral cooperation to improve food systems.

#2- The CEO Women Conference is finally here: The CEO Women Conference is taking place later today under the theme The Future of Healthcare in Egypt. The conference will highlight women's role in healthcare, the global focus on public health, and the role of AI in healthcare. The event — which will be held at the Four Seasons Hotel — will also debut the Entrepreneur Zone, a platform that will allow female entrepreneurs to showcase their innovative projects, connect with investors, and build valuable partnerships.

#3- Attention, real estate players: The Decision Makers Conference is putting the country’s real estate sector in the spotlight today, bringing together 500 attendees and over 30 speakers to discuss the country’s real estate sector. The conference will host sessions on urban development strategies, attracting foreign investment, and the current challenges and promises of Egypt's real estate industry with input from leading public and private sector players.

PSA-

WEATHER- We’re in for another cool day in Cairo, with a high of 26°C and a low of 18°C, according to our favorite weather app.

It’s just as cool in Alexandria, with a high of 26°C and a low of 19°C.

** DID YOU KNOW that we now cover Saudi Arabia and the UAE?

** Were you forwarded this email? Tap or click here to get your own copy delivered every weekday before 7am Cairo time — without charge.

CIRCLE YOUR CALENDAR-

Premium Healthcare to vote on acquisition of three labs operators next month: Premium Healthcare’s, previously known as City Lab, ordinary general assembly will meet on Thursday, 21 November to discuss and vote on the acquisition of three companies — Maadi for Lab Acquisitions, Ezz Laboratories, and a hospital management services provider, according to an EGX disclosure (pdf). The acquisitions have a combined price tag of EGP 1.1 bn, with Maadi for Lab Acquisitions being the most costly at EGP 478 mn.

We knew this was in the pipeline: The company announced last month that it intends to fully acquire four local labs operators — in addition to the hospital management services provider, which was not on last month’s list — in a EGP 991.7 mn acquisition spree.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

THE BIG STORY ABROAD-

It’s another mixed day in the foreign press dominated by US elections news as Kamala Harris delivers her closing remarks ahead of elections, more strikes in Gaza and a worsening humanitarian crisis, and a smattering of business news courtesy of earnings season.

#1- Less than one week from the US elections, Harris doubled down on her fight against The Donald with closing remarks at the Ellipse, where Trump had rallied his supporters on 6 January to fight against his loss in the 2020 elections, resulting in the US Capitol riot. She said Trump was “unstable, obsessed with revenge, consumed with grievance and out for unchecked power,” a day after Trump’s rally in Madison Square Garden hit a lot of nerves due to racist remarks from his allies. (Reuters | CBS | Semafor | The Guardian)

#2- At least 93 Palestinians — at least 20 of whom were children — were killed in northern Gaza yesterday in an airstrike on a residential building, an attack which the US called “horrifying,” Reuters reports. The US envoy to the United Nations also said Israel is not tackling the “catastrophic humanitarian crisis” in Gaza, as it faces a looming deadline imposed on 13 October to facilitate aid into Gaza or potentially lose US weapons support, the Guardian reports separately.

ALSO GETTING ATTENTION- Hezbollah appointed a new successor to its slain leader Hassan Nasrallah, Naim Qasem, in a move showing “continuity” and “resilience,” experts say. (Bloomberg)

#3- A handful of earnings are getting attention:

Google owner Alphabet reported a 34% jump in net income on the back of strong performance from its cloud division — results that help appease investors’ concerns over the payoff of Big Tech’s investments in AI. (FT | CNBC | Reuters)
Visa also saw its net income jump more than expected in a positive indication of consumer spending, beating market estimates. (Reuters | CNBC | FT)

ALSO- For the fellow iSheep, have you seen Apple’s new releases? The tech giant released its new Mac Mini — the tiniest desktop machine in its history — as well as the M4 iMac, and rolled out its first Apple Intelligence software capabilities across iOS, iPadOS, and macOS a day earlier.

*** It’s Hardhat day — your weekly briefing of all things infrastructure in Egypt: Enterprise’s industry vertical focuses each Wednesday on infrastructure, covering everything from energy, water, transportation, and urban development, as well as social infrastructure such as health and education.

In today’s issue: We look at what serviced apartments mean for Egypt’s property sector amid changing market dynamics.

Tags:

Moustafa Madbouly What We're Tracking Today

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Manufacturing

Sumitomo Electric’s pigtail cable factory in Tenth of Ramadan to begin operating next month

Sumitomo’s Tenth of Ramadan factory to go live next month: Japanese conglomerate Sumitomo subsidiary Sumitomo Electric is putting the finishing touches on its cable factory in Tenth of Ramadan, with production set to begin next month before an official opening in 1Q 2025, according to a statement. The company has invested some EUR 22 mn in the factory.

(Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

A slight delay: The factory, which will produce pigtail cables used in cars and cable harnesses, was originally scheduled to begin operations by the end of 2023.

The details: The 150k sqm factory will add around 3k jobs to the company’s existing workforce in Egypt. The factory was expected to produce cables for 1 mn cars per year, which would make it among the largest cable producers in the world.

More to come: The company plans to invest some EUR 8 mn in the Egyptian market over the coming 12 months, according to the statement.

VERNBRO’S NEW PHARMA FACTORY SET TO LAUNCH NEXT YEAR-

Vernbro Global to open EGP 1 bn pharma factory next year: US-based Vernbro Global Investment has completed the construction of an EGP 1 bn pharma factory spanning 7k sqm in Beni Suef that is set to open within a year, Al Borsa quotes the firm’s Sherif Younes as saying.

The company has big investments in Egypt: Vernbro Global is currently developing two logistics zone projects in Tanta and Kafr El Sheikh, with the Kafr El Sheikh project set to see EGP 6 bn in total investments by the time it is complete, Younis said. The project — which is currently around 30% complete — will be up and running in two years’ time and will include a commercial center, medical facilities, logistics warehouses, and auto services. Meanwhile, the Tanta project is almost ready to go and will include more or less the same facilities as the Kafr El Sheikh zone.

There’s more in the pipeline for Vernbro, too: The company aims to secure an 80-feddan plot from the Supply Ministry’s Internal Trade Development Authority in either Assiut or Sohag to set up an additional commercial and logistics center, Younis added.

Tags:

logistics Manufacturing pharma Sumitomo Electric

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Energy

Egypt Gas to help supply Jordan’s Quweira Industrial Zone with natgas

Egypt Gas to help supply natural gas to Jordan's Aqaba: State-owned Egypt Gas will partner with Jordan’s Aqaba Development Corporation (ADC) to set up a natural gas supply network for Quweira Industrial Zone in Aqaba, Jordan according to a statement. The project, which is set to be completed within 11 months of breaking ground, will cut down on energy costs, help set the stage for a more investment-friendly environment, and boost Jordan’s export competitiveness, Jordanian Energy Minister Saleh Al Kharabsheh said.

(Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

The details: The agreement will see both companies construct a pipeline network, control systems, and leak detection infrastructure that will deliver 30k cubic meters of gas per hour in the project’s first stage, reaching up to 90k cubic meters per hour in the future.

Not the first of its kind: The state-owned Egyptian Jordanian Fajr Natural Gas Company Egypt last year inked an agreement to build and operate a linking point and a station for the transport and supply of natural gas to the Quweira Industrial Zone. Work on the project is set to be completed during 1Q 2025.

Jordan is trying to reduce its energy bill, the minister said, adding that the government has launched an initiative to deliver natural gas to all of the country’s industrial areas. He explained that the country’s hefty energy bill was one of the main obstacles facing investors interested in the Jordanian market.

Could we see more of Egypt Gas in the Jordanian market? The company is currently conducting a number of fiscal and technical studies for projects regarding supplying industrial zones, domestic, and commercial areas in Amman, Zarqam, and Aqaba with natural gas.

Tags:

energy Jordan oil and gas

Healthcare

Vezeeta announces new innovation hub, Visa and Nymcard partnership, expansion plans outside of Egypt

Introducing Vezeeta Lab: Digital healthcare platform Vezeeta has launched a new innovation hub — dubbed Vezeeta Lab — to develop the company’s presence at home and abroad, in addition to developing new services, the company said in a statement (pdf). “Vezeeta Lab aims to empower the healthcare sector by providing advanced services that align with the growing needs of customers,” Chief Corporate Development Officer Choucri Asmar said.

(Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

Aiding the company’s expansion plans is a big part of the innovation center, with the company planning to expand into Libya and Iraq by next year, a company official told EnterpriseAM. Vezeeta is also looking to increase its presence in countries it is already operating in, he said, name checking Saudi Arabia, the UAE, and Nigeria.

Visa and Nymcard are also on board with the company’s plans: Vezeeta also signed cooperation agreements with electronic payments leader Visa and fintech player NymCard to develop, simplify, and improve the platform’s payment and booking services for both patients and doctors. The end game, according to Vezeeta, is to “create an integrated ecosystem for digital healthcare services that enhances quality and user experience.”

This is Visa’s first healthcare venture in the region: The agreement “marks our first steps into the healthcare sector in Egypt and the Middle East and reflects Visa’s commitment to driving digital transformation, by providing innovative and secure payment solutions,” Visa Egypt Country Manager Malak El Baba said.

Tags:

healthcare Vezeeta Visa

EARNINGS WATCH

Egyptian real estate giant SODIC reports highest ever quarterly sales + Mashreq reports 9M earnings

Earnings o'clock: It was a busy day for earnings with both our friends at real estate developer SODIC and UAE-based lender Mashreq Bank reporting their earnings for 3Q 2024 and the first nine months of the year.

SODIC REPORTS HIGHEST EVER QUARTERLY SALES-

SODIC’s Ogami pushes the company’s sales to record highs: Real estate developer SODIC reported EGP 31 bn in gross contracted sales in the third quarter of the year — a quarterly record for the company — which the developer attributed to “robust demand” for its new Ogami development on the North Coast, the company said in its latest earnings release (pdf). Net income was up 45% y-o-y to EGP 309 mn in the quarter and revenues increased 14% y-o-y to EGP 2.4 bn.

(Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

It’s been a good year so far for SODIC: On a 9M basis, the company has seen its revenues rise 26% y-o-y to EGP 6.3 bn, while its net income jumped 71% y-o-y, coming in at EGP 935 mn. Its gross contracted sales rose the highest, noting a 101% y-o-y increase to EGP 39.8 bn during the first nine months of the year.

The breakdown: North Coast projects accounted for 72% of the company’s total contracted sales for the nine-month period, with the Ogami project making 54% of total sales. West Cairo projects contributed 24% of total sales.

Remember: SODIC broke ground on its 440-acre Ogami development in Ras El Hekma in September. The hospitality project was planned by the DLR Group and includes a Nobu hotel, restaurant, and residences, alongside 800 meters of pristine beachfront.

What they said: “Our strong performance across all financial metrics is a testament to the strength of our brand and the confidence our customers have in our ability to consistently create value for them. We are proud to have made strong strides in our hospitality and retail platforms in 2024, further strengthening our customer experience which continues to set SODIC apart,” said SODIC General Manager Ayman Amer.

MASHREQ REPORTS 9M 2024 EARNINGS-

Mashreq reported AED 5.8 bn in net income after tax during the first nine months of 2024, maintaining its position y-o-y, according to the lender’s latest earnings release (pdf). On a pre-tax basis, the UAE-based bank’s net income rose 9% y-o-y to AED 6.5 bn, with the lender noting that its net income after tax remained strong despite the corporate income tax rising by an additional AED 500 mn.

Driving the growth: “Principal drivers of this increase are strong business growth with healthy margins, the benign interest rate environment, and relative low risk costs,” the lender said, pointing to a 13% y-o-y increase in net interest income — which recorded AED 6.3 bn during the nine-month period — and a 21% y-o-y jump in non-interest income which recorded AED 2.8 bn.

On a quarterly basis: Mashreq saw its net income dip 21% y-o-y in 3Q 2024 to record AED 1.8 bn and its pre-tax net income fall 15% y-o-y to AED 2.0 bn.

What they said: “Our strong performance in the first nine months of 2024 underscores Mashreq’s strategic direction and operational resilience in navigating dynamic market conditions,” CEO Ahmed Abdelaal said.

A year for expansion: “This year has been pivotal in expanding our footprint and enhancing digital capabilities. We launched the fully digitized NEO CORP platform for our wholesale banking customers clients in Bahrain, Kuwait, with Qatar to follow very soon, as a part of the initial roll out and made our first corporate banking loan transaction in the UK, strengthening our presence in key markets,” the CEO said.

Remember: Mashreq Neo Egypt launched in Egypt earlier this year with the aim of fulfilling clients’ on-the-go banking needs.

** We spoke to the bank’s head of Neo and personal banking Radu Topliceanu to learn more about what’s in the pipeline for Mashreq Neo. Check out the interview here.

Tags:

earnings earnings watch Mashreq Bank real estate SODIC

LAST NIGHT’S TALK SHOWS

Talk shows cover the razing of historical tombs

Antiquities Ministry confirms the razing of ten tombs amid broader urban renewal drive: Around ten historical tombs have been demolished as part of a plan to remove the Sayeda Aisha bridge and reroute entry to Historic Cairo through the Citadel area and its surroundings, head of the Antiquities Ministry’s Islamic, Coptic, and Jewish department Gamal Mostafa told Ala Mas’ouleety’s Ahmed Moussa (watch, runtime: 4:09). The tombs’ owners were given the choice of retaining the tomb structures or displaying them in the Cemetery of the Immortals, Mostafa said, with most families opting to have the structures transferred to the cemetery (watch, runtime: 4:15).

(Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

The painting of the Qasr El Nil lions got some airtime: Mostafa also addressed the controversy over the renovation of the iconic lion statues on the Qasr El Nil bridge, emphasizing that the renovation had been conducted in a scientific manner under the supervision of the Supreme Council of Antiquities (watch, runtime: 7:44). Speaking on Extra News, Tourism Minister Sherif Fathy said that the cleaning and maintenance process the statues have gone through has been performed previously without damaging the statues or changing their original color (watch, runtime: 2:52).

What controversy? The Syndicate of Fine Artists issued a statement voicing its concern regarding the renovation work being done to the statues, explaining that the way the renovation work is being done incorrectly and will damage the statues.

ALSO- What can we expect from the US presidential elections? “There’s a general sense that the Biden administration was particularly weak, and that the level of personnel in the US is generally declining,” political commentator Mostafa El Feki told Sherif Amer on Yahduth Fi Misr (watch, runtime: 3:23). El Feki predicted that Americans would opt for a more “aggressive” leader that exudes a stronger image than his predecessor — implying that republican presidential candidate Donald Trump would emerge as the victor.

Tags:

LAST NIGHT’S TALK SHOWS Tourism and Antiquities Ministry

Also on our Radar

AngloGold to acquire Centamin next month

M&A-

Inching closer to the AngloGold-Centamin acquisition: LSE- and TSX-listed mining company Centamin’s shareholders approved NYSE-listed global miner AngloGold Ashanti acquisition bid, with 98% voting in favor, the company said in an LSE disclosure. The transaction will be carried out on 22 November, pending the Royal Court in Jersey’s approval in a court hearing scheduled for 20 November.

ICYMI: AngloGold and Centamin last month reached an agreement that would see the Johannesburg-based mining giant acquire Centamin in a cash and share transaction valued at around USD 2.5 bn. The acquisition will give AngloGold ownership of the Centamin-run Sukari mine in Egypt, one of the world’s largest gold mines.

RETAIL-

Modon, Lulu to develop more retail facilities in Egypt: Abu Dhabi-based Modon Holding has partnered with the GCC’s largest grocery and retail chain Lulu Retail to develop and operate hypermarkets, supermarkets, and other retail facilities in Egypt and the UAE, according to an press release (pdf). Modon will be responsible for development works while Lulu will manage operations.

REAL ESTATE-

Adeer in negotiations to develop 1.2k-feddan worth of new projects: Saudi Sumou Holding Group subsidiary Adeer is in negotiations with a number of Egyptian real estate firms to develop nine projects on a total area of 1.2k feddans, CEO Bassel El Serafy told Al Borsa. While Sarafy did not disclose further details on the location of the projects or the negotiating firms, he did note that Adeer is currently in talks with Melee Development about developing a 100-feddan integrated urban area in West Cairo.

Adeer is looking to up its investments in Egypt: El Serafy previously told Asharq Business that the company plans to invest USD 400 mn in the Egyptian real estate sector over the next five years, with the company already developing projects in partnership with Paragon Developments, Hassan Allam Properties, and Melee. The company is also looking to set up an Egyptian real estate fund alongside Saudi fund manager Areeb Capital.

RENEWABLES-

AOI to construct Abu Qir’s new EGP 88.3 mn solar station: Abu Qir Fertilizers has awarded installation rights for its EGP 88.3 mn solar station to Arab Organization for Industrialization (AOI), according to an EGX disclosure (pdf). We first got word of the 2.5 MWp station in June after Abu Qir’s board approved the project in an effort to cut down on the company’s electricity consumption. AOI will have a year to complete the project.

Tags:

Abu Qir Fertilizers ALSO ON OUR RADAR Centamin real estate renewables Sukari gold mine

PLANET FINANCE

HSBC reports strong 3Q results + plans a fresh USD 3 bn stock buyback

HSBC posted pre-tax net income of USD 8.5 bn in 3Q 2024, rising 10.4% y-o-y, according to its earnings release. The improvement was fueled by growth in wealth and personal banking and gains across foreign exchange, equities, and global debt markets. However, net interest income dropped by USD 1.6 bn due to increased funding costs and asset sales. Operating expenses rose 2% to USD 8.1 bn, driven by technology investments and inflationary pressures. The bank completed the distribution of USD 4.8 bn to shareholders for last quarter’s results, which will bring HSBC’s total payouts in 2024 to USD 18.4 bn.

(Tap or click the headline above to read this story with all of the links to our background and outside sources.)

The lender also announced a new stock buyback of “up to” USD 3 bn, which is expected to wrap before its full-year earnings are released in February, according to the earnings release. The buyback announcement comes as the bank’s earnings came in stronger than expected, Bloomberg says. The bank “has already handed USD 34.4 bn to shareholders in the past 18 months, much of it in the form of stock buybacks, which have become one of the bank’s preferred ways to distribute capital to its investors,” the business information service notes.

Market reaction: HSBC’s shares closed up 3.9% in London yesterday, according to market data. The shares hit an intraday high of 4.9%, Bloomberg says.

ICYMI- Last week, HSBC unveiled a majo r restructuring plan to merge its global commercial and investment banking units and reorganize its geographical division to create standalone units for Hong Kong and the UK, while combining Asian Pacific and Middle East operations into one Eastern division. However, HSBC’s Chief Georges Elhedery refuted any suggestions that these moves are leading to a break up of the banking group, The Guardian said. “This is not either a precursor or an intent or a preparation for any split,” he said.

OVER IN THE US OF A- Top Wall Street executives — including the chief executives of Goldman Sachs, Morgan Stanley, and Standard Chartered, among others — doubt the US Federal Reserve will enact more than one more interest rate cut by year-end, Bloomberg reports. Speaking at a panel at the Future Investment Initiative forum in Riyadh, the executives signaled that further cuts are unlikely to be as significant as traders predict.

Traders anticipate that the Fed might implement two more rate cuts this year, potentially lowering the rate to c. 3.5% by the end of 2025 — following the first rate reduction in September. While Goldman Sachs CEO David Solomon said future predictions are difficult to make until after the US presidential elections are through “and we get a clear sense of policy actions,” BlackRock CEO Larry Fink suggested that cuts may not come quickly or deeply, especially given persistent high inflation.

EGX30	30,620	-0.5% (YTD: +23.0%)
USD (CBE)	Buy 48.64	Sell 48.78
USD (CIB)	Buy 48.64	Sell 48.74
Interest rates (CBE)	27.25% deposit	28.25% lending
Tadawul	12,062	+0.1% (YTD: +0.8%)
ADX	9,312	+0.1% (YTD: -2.8%)
DFM	4,583	+1.0% (YTD: +12.9%)
S&P 500	5,833	+0.2% (YTD: +22.3%)
FTSE 100	8,220	-0.8% (YTD: +6.3%)
Euro Stoxx 50	4,950	-0.4% (YTD: +9.5%)
Brent crude	USD 71.12	-0.4%
Natural gas (Nymex)	USD 2.35	+1.6%
Gold	USD 2,787	+0.2%
BTC	USD 72,491	+4.1% (YTD: +71.5%)

THE CLOSING BELL-

The EGX30 fell 0.5% at yesterday’s close on turnover of EGP 4.2 bn (0.8% above the 90-day average). Regional investors were the sole net buyers. The index is up 23.0% YTD.

In the green: Ezz Steel (+3.2%), Cleopatra Hospitals (+2.5%), and Emaar Misr (+2.0%).

In the red: Palm Hills Development (-4.1%), GB Corp (-3.0%), and Oriental Weavers (-2.8%).

Tags:

Financial Markets interest rates Planet Finance

HARDHAT

Could serviced apartments act as a growth driver in Egypt’s property sector amid changing market dynamics?

Are serviced apartments the next big thing in the real estate market? Given the saturation of the luxury and mid-income housing segments, developers are looking to introduce new products in 2025 as way to make sure that demand keeps pace. To meet evolving consumer needs amid rising construction costs that are pushing unit prices up, the real estate division is currently advising developers to venture into serviced apartments as a promising new product, Head of the Federation of Egyptian Industries’ (FEI) real estate division, Osama Saad El Din told EnterpriseAM.

(Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

But what is a serviced apartment, exactly? Serviced apartments are similar to rented units, but with some important differences. The units are fully finished, usually small in size, often leased immediately upon completion by specialized companies, and include services and amenities included in the rental price. These services often include things like housekeeping, laundry services, and even sometimes meals and a concierge, while internet, cleaning, and other amenities are included at no extra cost — an attractive prospect for those with busy lives or who will not use the property as their main place of residence.

Demand for serviced apartments reflects a changing market: Serviced apartments correspond to the market’s demand for adaptable offerings and meet the preferences of both current and potential clients, including foreign buyers and Egyptians abroad. The goal, Saad El Din says, is to adapt to market shifts and address rising costs that are changing customer habits.

The target audience: Egyptians living abroad, Arab and foreign tourists, and incoming students are among the primary target customers for these units, industry insiders told us. Small units are particularly in high demand in business hubs and tourism areas, positioning serviced apartments as a highly sought-after product for the foreseeable future.

Serviced units could be the new best seller during the next couple of years: Saad El Din sees demand for serviced apartments remaining strong in 2025 and 2026, with major developers already focusing their resources on these projects to meet both domestic and international demand. Some of Egypt’s top developers are already working on these projects and have begun marketing them internationally to attract more clients, he added.

Luxury appeal and competitive returns: These units prioritize luxury, premium finishes, and competitive features that promise significant investment returns, Saad El Din told us. He also noted that some companies — tied to major developers or operating independently — now offer marketing services for a share of the returns, which works to make investing in serviced apartments more secure.

A sought-after product in today’s market: Real estate marketing agency, B2B Marketing President Nehad Adel told EnterpriseAM that the market’s rising prices have driven demand for smaller units, particularly those under 50 sqm with long repayment plans and high savings potential. Serviced apartments in designated areas are likewise gaining traction for similar reasons, Adel explained to us, adding that Egypt’s real estate demand now falls into two categories — end-use properties, which are widely available across various price ranges, and investment properties, including serviced apartments and office spaces in commercial areas.

The price tag: The average price per sqm in these luxury units reaches EGP 100k, offering solid investment returns, while office spaces command higher prices, averaging EGP 150k per sqm, with potentially greater returns, according to Adel.

The new trend is in line with larger government targets: The real estate division is working in line with the country’s investment map to boost Egypt’s tourism infrastructure and increase hotel room capacity, Saad El Din told us. Developers have asked the government for more detailed investment maps for coastal areas, where demand for serviced apartments is expected to grow in line with projected tourism increases.

The industry is calling for the units to qualify for tourism incentives: Our sources confirmed to us that the FEI’s real estate division has asked the government to allow developers looking to build serviced apartments to benefit from the government’s EGP 50 bn subsidized loan program for hospitality companies. We also heard that the government has given its preliminary approval to the proposal.

Serviced units are already a big feature of the new capital: The business district in the new capital will host many of these serviced apartments, as will similar developments in Ras El Hekma and New Alamein.

Serviced apartments show that real estate is becoming more than just a safe haven asset: Mohamed El Bustani, the deputy head of the Federation of Egyptian Chambers of Commerce’s real estate division, told EnterpriseAM that the real estate market is expanding, noting that Egypt’s current economic environment has made real estate an attractive investment option, beyond its traditional role as a safe haven asset.

Your top infrastructure stories for the week:

Egypt and Italy are launching a new ro-ro shipping line in November connecting Damietta Port with Italy’s Port of Trieste. The shipping line will facilitate the transport of perishable agricultural commodities to European markets.
New hospitals in the pipeline: The government will offer up 21 plots of land to the private sector to develop the country’s healthcare sector in an effort to add 173k beds to the country’s residential capacity by 2030.
New Egyptian-Libyan industrial complex in the works? An Egyptian business delegation agreed with its Libyan counterpart to set up a comprehensive industrial complex leveraging Egyptian raw materials to serve as a trade corridor to Algeria, Tunisia, and other African markets.

Tags:

Hardhat infrastructure real estate

CALENDAR

2024

OCTOBER

30 October (Wednesday): The CEO Women Conference, Cairo, Egypt.

30 October (Wednesday): Decision Makers Conference, Cairo, Egypt.

NOVEMBER

2-3 November (Saturday-Sunday): The Iraq Investment Forum.

4-8 November (Monday-Friday): World Urban Forum, Cairo, Egypt.

7-9 November (Thursday-Saturday): FinExpo Conference and Exhibition, Cairo.

8-9 November (Friday-Saturday): Carerha Summit 2024, Cairo, Egypt.

10-12 November (Sunday-Tuesday): Falak Startups’ Fund Manager Masterclass, Cairo, Egypt.

12-15 November (Tuesday-Friday): Arab African Investment and International Cooperation Summit, Aswan, Egypt.

17-19 November (Sunday-Tuesday): Autotech Exhibition for Automotive Aftermarket & Feeder Industries, Cairo, Egypt.

21 November (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

25-27 November (Monday-Wednesday): Annual Digital Nation Conference, Cairo, Egypt.

26-28 November (Tuesday-Thursday): Egypt Energy Show, Cairo, Egypt.

28-30 November (Thursday-Wednesday): Cairo International Wood and Wood Machinery Show, Cairo, Egypt

30 November (Saturday): Deadline to apply for renewable energy projects under the peer-to-peer (P2P) system.

DECEMBER

16-17 December (Monday-Tuesday): Mining World Conference 2024, London, UK.

26 December (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

EVENTS WITH NO SET DATE

2H 2024: Gov’t to launch the Cairo Ring Road BRT buses.

3Q 2024: Egyptian-Armenian Joint Committee.

First week of November: Egypt-Turkey high-level trade consultation mechanism.

November 2024: Egypt to host the World Urban Forum (WUF12).

End of 2024: The launch of the high-speed train line linking Ain Sokhna with Al Alamein City.

2025

7-10 April 2025 (Monday-Thursday) : EFG Hermes One on One conference, Dubai, UAE.

May 2025: Egyptian Exporters Association (Expolink) exhibition, Italy.

July 2025: The first operational trail of Egypt-KSA electricity interconnection line.

March 2025: Operation of phase one of the Amotope wind farm

EVENTS WITH NO SET DATE

2Q 2025: Safaga Terminal 2 to start operations.

Mid-2025: The Administrative Capital for Urban Developments to roll out the second phase of offering industrial plots to investors.

2027

20 January-7 February: Egypt to host the African Games

EVENTS WITH NO SET DATE

End of 2027: Trial operations at the Dabaa nuclear power plant expected to take place.

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