Plenty of M&A + investment news at home as Fed teases rate cuts in the new year

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What We're Tracking Today

Fed signals pivot to rate cuts, sparking market rally

Good morning, friends. After so much macro and gnashing of teeth in the past few months, your Thursday morning read is packed with corporate announcements.

In the news well: EFG Hermes is said to be fundraising for Vortex, its high-profile renewable energy fund, Raya is making a smart play to up its stake in Ostool, B Investments’ board is going ahead with its bid for Orascom Financial, and the red-hot securitization market shows no sign of flagging heading into the final days of the year.

In Also on our Radar: There’s a gentle current of optimism running through the news. Majid Al Futtaim is looking to invest some EGP 5.7 bn to open 50 new Carrefour branches and 144 branches of wholesale grocery Supeco. Beltone Mortgage Finance is aggressively raising its capital, signaling confidence in its quick-turnaround mortgage product that could help breathe life into a frozen secondary market. And Sky Investments is lining up an EGP 3 bn facility to finance the buildout of a real estate project in the Fifth Settlement.

BEFORE YOU READ anything else this morning: Benedict Evans is back with his annual presentation on the macro and strategic trends he thinks will shape technology and business in the new year. Evans rose to prominence at Andreessen Horowitz and now runs his own consultancy — and is a sharp presence on Threads, for those so inclined.

His AI-focused deck this year has few answers, and plenty of questions — many of them worth pondering regardless of the industry in which you do business. Among the questions and takeaways:

The tech venture space is slowing down across the board — except within AI
Finance and tech executives are pushing hardest to figure out what AI means for their businesses. Retail and professional services execs are lagging behind.
Nobody knows what’s next: Is this a platform shift? Does generative AI change the nature of software? Does it take us to artificial general intelligence?

^^ The presentation is at its best when it’s unpacking all the questions within those last three questions. It’s worth an hour of your time this morning to read the presentation (87 easy-to-read slides) and then watch Evans deliver it in this video recorded earlier this month (watch, runtime: 27:40).

HOTEL BOOKINGS REBOUND-

Hotel bookings in Egypt + the Middle East are rebounding -Accor: Bookings in the region are rebounding after an initial freeze that followed Israel’s invasion of Gaza in October, with occupancy rates in Egypt holding strong, Accor CEO Sébastien Bazin tells Bloomberg. The hospitality giant saw heavy cancellations during the “total panic” of the first few weeks after the outbreak of hostilities, but this was “very, very short-lived, he said. “The occupancy we have today in Sharm el-Sheikh, in Cairo, and many other places has been very, very strong.”

Remember: Business for our tourism sector has remained steady despite the war on Gaza, with Tourism Minister Ahmed Issa still expecting we will hit our target of bringing a record 15 mn tourists into the country this year.

COMMODITY CRUNCH-

Coping with the commodities crisis: Prime Minister Moustafa Madbouly held “intensive talks” yesterday with a number of ministers and senior officials to lay out his government’s response plan spiraling prices and short supply of a number of basic commodities including sugar and onions.

The goal, per a cabinet readout: Short-term price stability. Here’s the rundown:

Clear definitions: Cabinet will finalize and issue a list of what, exactly, constitutes a “basic commodity” at any given time;
The Supply Ministry will take steps to improve the supply of those goods in the market. The statement didn’t say whether the ministry would tap strategic reserves or import more to address the gaps.
Are you hoarding? Price gouging? Government inspectors are going to be making more visits to wholesalers and retailers alike.

PSA- The blackouts are back: With the election over, the four-day respite from blackouts is officially at a close. Expect two hours of power cuts a day from here on out, Electricity Ministry sources tell Al Mal.

HAPPENING TODAY-

#1- Deadline day for brownfield mining bid round: Companies have until 12 pm today to bid for five brownfield gold concessions in the Eastern Desert from the state-owned Shalateen Mining Resources Company. Another 13 exploration concessions will also soon be up for grabs at the start of next year, a government source recently told Enterprise.

Another extension could be in the cards: The government will wait until the end of submissions to determine whether to extend the deadline for a third time, our source said.

#2- The Food Africa Expo concludes today: The three-day trade show in Cairo has hosted b2b networking and taste-testing between F&B players from 30 countries around the Middle East and Africa.

#3- Hopes for yet more trade with KSA: Egyptian manufacturers have spent the week in Jeddah vying for more orders on pumps, car parts, and other engineered goods from Saudi Arabia, the largest importer for our engineering sector. The trip, organized by Egypt’s Engineering Export Council, wraps tomorrow.

#4- El Gouna Film Festival kicks off today after having been postponed from its original October date. In response to the catastrophe unfolding in Gaza, this year’s edition will also feature a program of Palestinian cinema in collaboration with the Palestine Film Institute.

HAPPENING THIS WEEK-

Negotiators are giving GERD talks another go: Efforts to find a breakthrough in the so far intractable GERD dispute will resume in the Ethiopian capital on 16-18 December.

THE BIG STORIES ABROAD-

#1- Fed signals pivot to rate cuts, sparking market rally: Federal Reserve chair Jerome Powell said on Wednesday that the US central bank’s tightening cycle is “likely at or near its peak,” and that officials are now discussing the prospect of lowering interest rates from their current 22-year high, Financial Times reports. As expected, the central bank held the fed funds rate unchanged at 5.25-5.5% in the wake of inflation data that showed price growth moving closer to the 2% target in November, despite indications of persisting underlying pressures.

Fed officials penciled in no further rate hikes in their projections — the first time they’ve done so since March 2021, boosting traders’ predictions of a reduction in March to “a near certainty,” according to Bloomberg.

Officials expect to lower rates by 75 bps in 2024, and expect them to fall to 3.5-3.75% by 2025, according to the Fed’s “dot plot” (pdf). This is a bigger drop than analysts expected, as a recent poll saw economists predicting that the Fed would only trim rates by half a percentage point or less in 2024.

What analysts said: “His presser certainly had a tone of finality to it,” one economist told Bloomberg. “Jerome Powell seems to be done taking the punch bowl away,” said another. “It’s a big change in the language that indicates policymakers see less need to aggressively tighten.”

Cue huge market rally:

US stocks rallied: The Dow Jones closed at a record high of 37k, while the benchmark S&P 500 gained 1.4% to close at its highest level since January 2022.
Bond yields tanked: The two-year treasury yield recorded its biggest daily fall since the collapse of Silicon Valley Bank in March.
Gold popped: The precious metal gained 2.7%.
The greenback fell: The USD fell to a four-month low.
BTC spiked: The cryptocurrency jumped as much as 4% to more than USD 43k.

Powell’s presser is already having an effect here at home: The surge in the international gold price pushed local gold prices to record highs. The price of 24 karat gold rose 1.4% to EGP 3,234 per gram yesterday, leaving it almost 70% higher year-to-date.

** It’s the CBE’s turn next week: The Central Bank of Egypt (CBE) is scheduled to convene for its final meeting of 2023 next Thursday, 21 December.

IN OTHER BUSINESS NEWS-

Bad day for Tesla: The EV giant has been forced to recall almost all 2 mn of its cars on the road in the US to patch the safety features of its autopilot system. (Reuters)
Argentina’s Chicago boy starts the shock therapy: Argentina’s currency plunged more than 50% yesterday, as the country’s new libertarian president Javier Milei kicked off his (slightly less) radical reform agenda, which includes slashing government spending (but doesn’t include burning the central bank to the ground). (Reuters)
SBF’s lawyer breaks silence on his client: “He may be at the very top of the list as the worst person I’ve ever seen do a cross examination.” (Bloomberg)

WAR ECONOMICS-

#1- The cost of the war on Israel’s neighbors: Egypt, Lebanon and Jordan could suffer an economic blow of at least USD 10 bn from the ongoing war in Gaza, according to a UN study picked up by Reuters. The three countries could together lose USD 10.3 bn (equivalent to around 2.3% of GDP), an amount that could double if the fighting continues for another six months.

#2- Ships are rerouting away from the Red Sea and Gulf of Aden amid increasing attacksonvessels by the Houthis, according to S&P Global. Companies are tightening security measures, with some choosing to transit around Africa to avoid the risk of attack, despite prolonging their journeys by around two weeks. Ins. rates have also climbed as the Houthis warned last week that they would expand their target to all ships heading to Israel, regardless of their nationality.

Another vessel came under attack yesterday near the Bab El Mandeb strait: Two missiles fired from a Houthi stronghold in Yemen narrowly missed a commercial tanker heading to the Suez Canal and carrying Indian-manufactured jet fuel, the Associated Press reported.

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“Historic” agreement at COP28 “signals the end of the age of oil”

The end of fossil fuels? One of the most hard-fought COP gatherings ever has ended in Dubai with what the global business press is — in the main — cheering as an “historic” agreement that “signals the end of the age of oil” after leaders from almost 200 countries signed off yesterday morning. The meeting ended in overtime after marathon negotiations

“Together we have confronted the realities and sent the world in the right direction,” said Sultan Al Jaber, wearing his COP28 hat, at his closing plenary speech, describing the package as “historic” and branding it “the UAE consensus.”

Key clauses in the final text, verbatim:

“Transitioning away from fossil fuels in energy systems, in a just, orderly and equitable manner … so as to achieve net zero by 2050 in keeping with the science.”
“Tripling renewable energy capacity globally and doubling the global average annual rate of energy efficiency improvements by 2030.”

It’s the first time in three decades of UN climate conferences a final agreement mentions fossil fuels in its wording and steers toward a low-carbon energy system. The European Union hailed the decision as the “beginning of the end of fossil fuels.”

It was never a certainty that they’d reach an agreement. Saudi Arabia along with Iraq, India and others fiercely oppose the use of “phase out” or “phase down” in any final agreement. Saudi had signaled since the first days of COP28 that it simply wouldn’t sign an agreement that even hinted at the end of hydrocarbons, which account for as much as 45% of its GDP.

In the other: The European Union and small island nations, who have variously called the Arab world’s stance “disgusting,” “deeply disappointing,” and “out-of-step.” Climate change is particularly existential for the island countries, who face the prospect of their nations sinking into seas and oceans.

The compromise was wording on “transitioning away” from hydrocarbons — and some wanted the agreement to go further, with a group of small island countries criticizing the text’s “ litany of loopholes.”

Judge for yourself The final text of the pact — called the “global stocktake” in COP-ese — is here (pdf).

Check out coverage from: Financial Times | Bloomberg | Reuters | Associated Press

Gov’t to launch pilot mandatory carbon market in 1Q 2024

A mandatory carbon market is in the works: The government is planning to launch a pilot phase for a proposed mandatory carbon market in 1Q 2024, two government sources told Enterprise. The market — which will take efforts to reduce greenhouse gas emissions up a notch from the EGX’s planned voluntary carbon market — will be piloted during a non-compulsory first phase, before it goes live following approval from the EGX and the Financial Regulatory Authority (FRA).

ICYMI: The EGX last year announced it would set up Africa’s first voluntary carbon market. The market aims to allow companies in Egypt and Africa working on emissions-reducing projects to sell certified carbon credits, which can then be bought by other companies wanting to offset their emissions.

Voluntary vs. mandatory carbon markets:Voluntary markets allow companies to voluntarily purchase carbon credits to offset their carbon emissions. Mandatory markets legally require participants to offset their carbon emissions by purchasing credits to achieve government-mandated or international reduction targets.

We already have an advisor for the project: The World Bank is advising the Environment Ministry on how to set up the market, one source tells us. In the meantime, a number of governmental entities — including the environment and electricity ministries as well as the FRA and the EGX — are looking at regulatory frameworks adopted by other countries.

Who will be involved? The project will target companies and institutions that operate in a number of industries, including fertilizers, petrochemicals, transportation, waste recycling, renewable energy, construction, mining, and petroleum. The electricity sector has already sold carbon certificates for renewable energy projects, we’re told.

The project could be an FX generator: Carbon certificates will be sold to both local and foreign companies, our source said. Al Borsa also reports that the government will offer surplus carbon credits on international markets in a bid to raise FX.

EFG Hermes eyes USD 300 mn second close for Vortex renewable energy fund

Second close for Vortex Energy IV Fund around the corner? Our friends at EFG Hermes have reportedly opened subscriptions for a second close of USD 300 mn for the fourth fund of flagship renewable energy investment platform Vortex Energy, Al Borsa reports, citing an unnamed source at the fund. The close — which is reportedly targeting commitments from Gulf sovereign wealth funds and European investors — could wrap up before the year’s end, bringing the fund’s total size to over USD 500 mn. A senior exec declined to comment when we reached out yesterday.

ICYMI: The fund reached first close of USD 200 mn back in 2021.

Where’s all that dry powder going to be deployed? The fund will finance the expansion of Spanish renewables developer Ignis Energia and potentially the acquisition of an unnamed major renewables company which is currently under study, according to the local outlet.

Vortex Energy loves Ignis: Vortex has reportedly invested around EUR 398 mn in Ignis so far according to Al Borsa. It had committed some EUR 300 mn to the company as of the beginning of November, EFG Hermes co-CEO Karim Moussa told us last month. It is unclear whether Vortex is still on track to invest a total of EUR 625 mn in Ignis to acquire an undisclosed stake in the firm; Moussa told us previously that it was in talks to revisit the plans due to changing market conditions.

B Investments’ board approves Orascom Financial acquisition bid

B Investments’ move for Orascom Financial Holding MTO advances: B Investments’ board of directors has approved a mandatory tender offer (MTO) to acquire up to 90% of Orascom Financial Holding (OFH) (c. 4.2 bn shares) via a share swap, according to an EGX disclosure (pdf) on Tuesday.

The details: The board agreed to an MTO swap ratio of one B Investments share to 56.76 OFH shares. To enable the swap, the board approved raising its issued share capital from EGP 800 mn to EGP 1.2 bn through the issuance of 75 mn shares at a par value EGP 5 per share. The board also put the share premium per share at EGP 20.22 to accommodate the share swap ratio.

What’s next: B Investments has called for an extraordinary general meeting to approve the capital increase.

Wrapped in two months? B Investments expects the acquisition to wrap in February after the Financial Regulatory Authority has given its blessing to the MTO, Asharq Business quoted the company’s Chairman Hazem Barakat as saying.

We knew this was coming: B Investments had approved a plan to submit the MTO back in June, but requested a deadline extension in September.

Raya Holding to up its stake in Ostool to 90%

Ostool’s largest shareholder is on track to become even larger: Raya Holding for Financial Investments has signed an agreement to purchase a 27.7% stake in its freight subsidiary Ostool from Egyptian Gulf Holding Financial Investments, EGBank’s investment arm, Raya stated in an EGX disclosure (pdf). The acquisition would boost Raya’s stake in Ostool to 90%.

A change of plan: Raya had been on track to sell its 62.3% stake in Ostool to Paradigm Logistics last year, but the sale didn’t go through because the buyer didn’t transfer the funds within the required time, Raya Holding CFO Hossam Husseintold us yesterday.

Why the 180? Ostool’s solid performance in recent years is behind Raya’s decision to up its stake, Hussein told us. Hussein declined to discuss the valuation at which the transaction would be executed.

Market reax: Raya’s shares rose 3.4% to EGP 2.75 on the EGX yesterday.

GB Corp’s Drive raises EGP 1.47 bn in fresh securitization

Drive Finance returns to the securitization market:GB Corp’s car finance arm Drive Finance has raised EGP 1.47 bn in its second securitized bond issuance this month, according to a statement (pdf) released yesterday by our friends at CIB, who advised, led, and promoted the sale.

The sale: The issuance was 1.7x oversubscribed and is part of the company’s three-year EGP 5 bn program. The bond’s three tranches were rated AA+, AA, and A by the Middle East Ratings and Investors Service (MERIS). This takes the total amount raised from the securitization market by Drive in December to almost EGP 3 bn after it closed a EGP 1.4 bn issuance earlier in the month.

Where the money’s going: The proceeds will help Drive improve its liquidity and support its capital structure, in line with the company’s long-term growth strategy, the statement reads.

The buyers: The Arab African International Bank (AAIB) and Ahli United Bank were underwriters of the issuance. Al Baraka Bank and Bank ABC subscribed to the issuance.

Advisors: CIB acted as financial advisor, transaction lead arranger and promoter, alongside the AAIB as the sale’s custodian. Dreny & Partners was counsel and KPMG served as auditor.

DATA POINT- Companies have raised EGP 80.4 bn from securitization so far this year, up 77% from 2022, according to data tracked by Enterprise.

Israel vows to continue its war on Gaza despite overwhelming international opposition

Shocker: Israel doesn’t plan on taking the UN General Assembly’s advice: Israel said it will continue its war on Gaza “with or without international support,” after more than three-quarters of the 193-member UN General Assembly called for an immediate humanitarian ceasefire in a vote on Tuesday.

Israel dealt heaviest military losses since October: Israel yesterday reported that Hamas fighters on Tuesday killed at least 10 Israeli soldiers — including two senior officers — in an attack in Gaza City, in what Reuters says is the highest daily death toll for the military since 31 October.

The IDF might want to rethink its stated goals:“Israel doesn’t seem to be anywhere near achieving its military objective,” senior Israel analyst Mairav Zonszein said on X, referring to Tuesday’s ambush.

The situation on the ground continues to deteriorate:

At least 18.6k Palestinians have been killed since 7 October;
Up to 1.9 mn people have been displaced;
Just 11 of Gaza’s 36 hospitals are partially functional;
The World Health Organization (WHO) reported a sharp rise in fast-spreading diseases; the Gaza Health Ministry reported 327k cases of infectious diseases.

Egyptian cabinet appoints new spokesperson

Cabinet has a new spokesperson:Mohamed El Homsani has been appointed the Madbouly cabinet’s new spokesperson, cabinet said yesterday. Homsani enters the role after serving as the director of Arab League affairs at the Foreign Ministry and has previously been a part of diplomatic missions to the UN in New York, Zambia, and New Zealand.

A quick turnover: Homsani succeeds Sameh El Kheshen, who has been in the job for less than three months. El Kheshen is returning to the Foreign Ministry to take on an unspecified role.

As the vote count continues, there’s little suspense over who won the presidential election on Egypt’s talk shows

The presidential election and ongoing vote count continued to occupy most of the time on the airwaves last night.

The talking heads aren’t holding their breaths over the result: “Although I can’t officially say the result, it’s become quite clear for everyone based on the preliminary results from polling stations,” Al Hayah Al Youm’s Mohamed Sherdy said (watch, runtime: 4:54). Meanwhile, Ala Mas’ouleety’s Ahmed Moussa covered the fierce competition between candidates Farid Zahran and Hazem Omar for (distant) second place, while ripping into the Wafd party for its candidate’s expected poor performance (watch, runtime: 7:05).

A record turnout? Early indicators suggest that over 65% of eligible voters participated in the presidential elections, which would be the highest percentage in Egypt’s history, Masaa DMC’s Dina El Wakeel said (watch, runtime: 2:04).

AND- The coverage of the war on Gaza began to ramp up again last night following Tuesday’s UN General Assembly vote and US President Joe Biden’s minor shift in tone with Israel. Ala Mas’ouleety (watch, runtime: 11:10), Al Hayah Al Youm (watch, runtime: 1:22), and Masaa DMC (watch, runtime: 10:29) all had coverage.

A slower morning in the foreign press amid lull in election, Gaza news

This morning in the foreign press: We’ve hit a domestic news lull uncharacteristic of late, as authorities continue the vote count from this week’s election and regional leaders work out their next steps as Israel angrily dismissed Tuesday’s overwhelming UN General Assembly vote for a ceasefire in Gaza.

Getting attention this morning:

Koshary, pyramids and a camel ride:Conde Nast Traveler profiles Cairo’s pharaonic sites, best restaurants, and cultural hotspots through the eyes of Art D'Égypte founder Nadine Abdel Ghaffar.
The struggles of women footballers: An archaic view and gendered view on football is getting in the way of the success of the women’s game in Egypt, striking a sharp contrast with the men’s team’s stellar track record in African football. (Guardian)

ADES Holding handed 10-year contract to operate Suez brownfields. PLUS: Beltone Mortgage, Majid Al Futtaim, Sky Investments, EGBank

ADES LANDS SUEZ BROWNFIELDS- A consortium led by the Saudi Public Investment Fund (PIF)-backed ADES Holding was awarded a 10-year contract to operate and ramp up oil production at maturing fields operate by Suez Oil Company and Offshore Shukeir Oil Company. The contract, awarded by the Egyptian General Petroleum Corporation, can be extended for another 10 years. (Company statement,pd f)

Remember: Cairo-born ADES Holding raised USD 1.2 bn in an IPO on the Saudi stock exchange in October.

BELTONE MORTGAGE CAPITAL RAISE- Beltone Mortgage Finance has substantially increased its issued capital from EGP 50 mn to EGP 1 bn and raised paid-up capital to EGP 500 mn. (Company disclosure, pdf)

SKY INVESTMENTS TURNS TO BANQUE MISR FOR LOAN- Private investment company Sky Investments is expected to have a request for a EGP 3 bn loan from Banque Misr approved before the end of the year. Other banks could pitch in a portion of the facility, which will be used to fund a real estate project in the Fifth Settlement. (A sharq Busin ess)

AL FUTTAIM TO INVEST EGP 5.7 BN IN GROWTH HERE: Majid Al Futtaim Holding is set to invest EGP 2.2 bn to open 50 new branches of Carrefour in Egypt over the next two years, and another EGP 3.5 bn to open 144 branches of wholesale grocery store Supeco. (Al Borsa)

FRESH FUNDS FOR PORT DEVELOPMENT- The Export Development Bank (EBank) is leading a syndicate of banks that’s putting together a medium-term EGP 2-bn loan for Abdel Salam El Feky Sons to finance the construction of a breakwater at the Alexandria Port and other projects. (EBank statement)

TOUGHER PENALTIES FOR HARASSMENT: President Abdel Fattah El Sisi ratified amendments to the penal code that toughen penalties for people found guilty of harassment in the workplace and on transport. (Youm7)

Dubai is setting up a new sovereign wealth fund

Dubai is getting a new SWF: Dubai is setting up a second multi-bn USD wealth fund to channel state wealth into strategic projects at home and abroad, state news agency Wam reported Monday.

The remit: Chaired by Sheikh Mohammed bin Rashid Al Maktoum, the Dubai Investment Fund will focus its investments in stocks, bonds and securities in local and international financial markets, and will have the power to set up investment funds and companies.

Remember:

Dubai already has one: TheInvestment Corporation of Dubai, which has USD 341 bn in assets.
It’ll still be behind Abu Dhabi: Its neighbor has three sovereign wealth funds: ADQ, Abu Dhabi Investment Authority, and Mubadala, which together manage almost USD 1.5 tn in assets.

Frontier markets are facing a growing debt crisis: Debt levels of the 42 countries classified as “frontier markets” by the Institute of International Finance (IIF) have doubled over the past decade, reaching a record USD 3.5 tn, writes Bloomberg. The debt covers government, corporate, and household borrowing, with USD 200 bn due to be repaid next year.

Inflows are harder to come by: The US Federal Reserve is not expected to cut interest rates until at least mid-2024, which has dampened investors’ appetite for frontier-market debt. “Global rates are considerably higher, and the incentive to invest in these markets is challenging when you can get 4% or 5% in US Treasuries,” IIF Managing Director Sonja Gibbs said.

EGX30	24,774	+2.9% (YTD: +69,7%)
USD (CBE)	Buy 30.83	Sell 30.96
USD at CIB	Buy 30.85	Sell 30.95
Interest rates CBE	19.25% deposit	20.25% lending
Tadawul	11,401	+0.1% (YTD: +8.8%)
ADX	9,437	-0.1% (YTD: -7.6%)
DFM	3,939	+0.1% (YTD: +18.1%)
S&P 500	4,707	+1.4% (YTD: +22.6%)
FTSE 100	7,548	+0.1% (YTD: +1.3%)
Euro Stoxx 50	4,530	-0.1% (YTD: +19.4%)
Brent crude	USD 74.26	+1.4%
Natural gas (Nymex)	USD 2.35	+1.6%
Gold	USD 2,042.10	+2.5%
BTC	USD 43,000	+4.6% (YTD: +158.8%)

THE CLOSING BELL-

The EGX30 rose 2.9% at yesterday’s close on turnover of EGP 4.3 bn (36.5% above the 90-day average). Local investors were net sellers. The index is up 69.7% YTD.

In the green: Mopco (+20.0%), Sidpec (+9.2%) and Abu Qir Fertilizers (+8.6%).

In the red: Fawry (-1.5%), Egypt Kuwait Holding (-0.3%) and Credit Agricole (-0.2%).

It’s green as far as the eye can see in Asia this morning (though the Nikkei has been flirting with the red just a bit) as traders continue the rally that started after the Fed’s big interest rate signal yesterday. (We have coverage of that last bit above, in What We’re Tracking Today.) Futures suggest markets in Western Europe and North America will follow suit later today.

My Morning Routine: Mahmoud Riad

Mahmoud Riad, head of Riad Architecture: Each week, My Morning Routine looks at how a successful member of the community starts their day — and then throws in a couple of random business questions just for fun. Speaking to us this week is Mahmoud Riad (LinkedIn), who leads Riad Architecture.

My name is Mahmoud Riad and I am an architect and the head of Riad Architecture, a three generation, 90-year old firm based in Cairo that is responsible for some of the city’s most iconic modernist buildings, including the Arab League and the Nile Hilton. The firm was founded by my grandfather, Mahmoud Riad, and my brother and I are the third generation of architects after my father and uncle to run the business.

At work I’m CEO, business developer, and designer: My responsibility is to make sure that my team is all in place and effectively handling the tasks that are being delegated to them. I also run client communication and business development. At the same time I like to actually do the design myself with some projects. Usually, these are projects that I feel are significant to the office, like the Arab League building.

Our projects: Currently, we’re working on an extension project for the Arab League, a business park in Sodic West, and building several villas in Dallas, Texas. I have a dream that I want to buy all of Riad Architecture’s Cairo buildings and restore them to their former glory because I’ve been seeing a lot of them demolished or repurposed in a way that defeats the initial idea.

Nearly a century of creation: My grandfather created a legacy of very grand buildings with spatial layouts that were neoclassical in style and had modern facades, while the second generation designed residential homes and offices in the brutalist style of the 1980s and Greco-Roman-, Mediterranean-style resorts on Egypt’s coasts.

I’m trying to lead a different type of philosophy in architecture through my business: My ethos is one based on critical regionalism and phenomenology. We want to design for the spirit of a place, looking at it through a critical eye to try to understand the use of traditional architectural techniques or philosophies, asking why they are incorporated and how they have evolved. We try to push these in a different direction that could cater to today’s zeitgeist and the spirit of the time. We also consider how an individual’s sensory experience alters their perception of space.

That's what we're trying to do as the third generation: I can't really say that we're there yet, as a lot of our projects don't really fall under that umbrella, but we're trying slowly but surely to venture into this. If we have ten regular projects, we hope to have one that we feel can fall under that philosophical umbrella.

We’re seeing a growing trend in revitalizing Cairo’s forgotten buildings: I believe that Cairo’s architectural future is in adaptive reuse, like with all the work that’s happening in Downtown and other metropolitan areas that have been forgotten or left behind. Cairo has a lot of leftover, unoccupied space, much of which is quite substantial and rich architecturally. Instead of tearing them down, repurposing them is a great alternative, but the firms face challenges in convincing investors, who see new builds as more profitable.

I wake up at 5am every morning to be at the gym between 6-8am, so that I can be at the office by 8:30am, reading Enterprise on the drive in. My day starts with checking in with the design team, after which I head to meetings, visit our sites or clients, and return to the office by 4pm where I stay until 7pm. Throughout the day, I take short breaks here and there, but the one constant in my day is work.

Routines make my day easier for me: I structure my time to fit in small breaks to motivate me when I need it, or meditate and listen to different mantras. It gives me a bit of a boost to make sure that I stay on track.

When I’m not working, I really enjoy spending time in the sun or at the pool. We’re currently in the middle of a work marathon, but before that I used to meet up with friends every weekend to venture off to different parts of Cairo and explore places we haven’t seen before — most recently the Nilometer in Manial. My favorite space in Cairo would be a thin triangle in Sharia Al Mu’izz, encompassing the Sabil and Kuttab of Ismail Pasha. The street appears to be one continuous wall until you start walking towards it and the street turns into a fork. It’s a spot that I really like spatially.

The only movie that I’ve seen that I really liked over the last year was Oppenheimer. I’m a big fan of Christopher Nolan and the way he creates this male protagonist type struggling with inner turmoil and decisions they need to live with. I was also really drawn to Ted Lasso as a character, to me he is quite inspirational.

There are two pieces of advice that I stick to: When I was applying to study music, a friend of my father’s told me, “always go for gold, never settle for silver.” The second is from J.D. Salinger’s Catcher in the Rye, which says, “The mark of an immature man is someone who wants to die for his cause. The mark of a mature man is one who wants to live humbly for it.”

CALENDAR

DECEMBER

9-15 December (Saturday-Friday): The Engineering Export Council of Egypt’s trade mission to Saudi Arabia.

12-14 December (Tuesday-Thursday): Food Africa Expo, Egypt International Exhibition Center.

14 December (Thursday): Bidding deadline for five gold mine concessions in the Eastern Desert.

14-21 December (Thursday-Thursday): El Gouna Film Festival.

16-18 December (Saturday-Monday): Egypt, Ethiopia, and Sudan to resume talks over the filling of the Grand Ethiopian Renaissance Dam (GERD).

20 December (Wednesday): End of sugar export ban.

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

Signposted to happen sometime in December:

Gov’t expects to finalize sale of a stake in military-owned bottled drinks company Safi
Gov’t expects to finalize stake sale for military-owned fuel retailer Wataniya.
Gov’t expects to finalize sale of Zafarana wind farm
FRA to announce chosen consortium for credit rating license
Kenyan trade conference in Egypt.

EVENTS WITH NO SET DATE

2H 2023: Egyptian government expected to sign agreements with a consultant for the EuroAfrica electricity interconnector.

2H 2023: President Abdel Fattah El Sisi and Turkish President Recep Tayyip Erdogan expected to hold a summit.

3Q 2023: E-Finance to launch in Saudi Arabia.

4Q 2023: EGX to launch its new futures exchange.

4Q 2023: EGX to launch a shariah-compliant index.

End of 2023: A Developments’ first phase of the Lazoghly development completed.

2024: Standard Chartered Bank to open a branch in Egypt.

25 February 2024 (Sunday): Deadline for bidders for oil and gas expansion in the 23 new regions.

Q1 2024: Opening of the new developed Pyramids Plateau in Giza.

June 2024: Gov’t expects to finalize sale of Beni Suef combined-cycle power plant.

1H 2024: Gov’t expects to finalize sale of four water desalination plants.

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

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

November 2024: Egypt to host the 12th session of the World Urban Forum (WUF12).

2Q 2025: Safaga Terminal 2 to start operations.

2024

EVENTS WITH NO SET DATE

The Grand Egyptian Museum could be officially open to visitors some time between February and May 2024 .

Q1 2024: Opening of the newly developed Pyramids Plateau in Giza.

JANUARY

1 January (Monday): Egypt to join the Brics.

1 January (Monday): Private-sector minimum wage to rise to EGP 3.5k.

7 January (Sunday): Coptic Christmas.

17 January (Wednesday): A delegation of Egyptian companies to visit Istanbul.

25 January (Thursday): Revolution day.

FEBRUARY

11 February (Sunday): The deadline to apply for the Chicago Booth Executive Program

APRIL

9 April (Tuesday): Eid El Fitr (TBC).

25 April (Thursday): National holiday in observance of Sinai Liberation Day (TBC).

MAY

1 May (Wednesday): National holiday in observance of Labor Day (TBC).

5 May (Sunday): Coptic Easter.

6 May (Monday): Sham El Nessim (TBC).

29 May (Wednesday): Chicago Booth Executive Program

JUNE

15-19 June (Saturday-Wednesday): Eid El Adha (TBC).

30 June (Sunday): June 30 Revolution Day.

JULY

7 July (Sunday): National holiday in observance of Islamic New Year (TBC).

23 July (Tuesday): Revolution Day.

SEPTEMBER

2-5 September (Monday-Thursday): Egypt International Airshow, El Alamein International Airport.

15 September (Sunday): National holiday in observance of Prophet Muhammad’s birthday (TBC).

OCTOBER

6 October (Sunday): Armed Forces Day.

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