{"id":619662,"date":"2024-05-08T00:00:00","date_gmt":"2024-05-08T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/hardhats\/egp-float-jumpstarts-cairos-real-estate-market-in-q1-2024\/"},"modified":"2024-05-08T00:00:00","modified_gmt":"2024-05-08T00:00:00","slug":"egp-float-jumpstarts-cairos-real-estate-market-in-q1-2024","status":"publish","type":"hardhat","link":"https:\/\/enterpriseam.com\/egypt\/hardhats\/egp-float-jumpstarts-cairos-real-estate-market-in-q1-2024\/","title":{"rendered":"EGP float jumpstarts Cairo\u2019s real estate market in Q1 2024"},"content":{"rendered":"

Cairo\u2019s residential real estate market made a strong start in Q1 2024<\/strong>, with construction, handovers, and project launches progressing on the back of price stability following the EGP float, global real estate consultancy JLL said in its quarterly Cairo Real Estate Market Overview report (pdf)<\/a>. This strong performance marks \u201ca turning point in the sustained growth and development of the country\u2019s real estate market,\u201d a separate statement (pdf)<\/a> by JLL reads.<\/p>\n

The why: <\/strong>The EGP float has reignited investor confidence and provided developers with clarity on pricing after they had been basing prices on speculations of the future exchange rate on a volatile and unpredictable parallel market.<\/p>\n

By the numbers:<\/strong> Over 7k residential units were completed during the quarter, bringing the total residential stock to around 276k units. Residential sales prices jumped 83% y-o-y in Sixth of October and 95% y-o-y in New Cairo. Meanwhile, rental rates in the two districts rose 42% y-o-y and 43% y-o-y, respectively.<\/p>\n

It was a mixed bag for the office sector:<\/strong> Nearly 9.5k sqm of office space was delivered in the first quarter with the completion of Trivium Zayed in West Cairo, bringing the total office stock to over 2 mn sqm. While the sales market took a hit as the weakening currency rendered office spaces unaffordable to many buyers, prices on the rental market were virtually unchanged y-o-y. Average rent across the city inched down 1% q-o-q to USD 357 per sqm, while rent in prime locations dropped 6% q-o-q to USD 480 per sqm.<\/p>\n

A shifting retail landscape: <\/strong>Occupancy rates in many malls rose as the float paved the way for affordable local brands to enter the retail sphere in lieu of the international brands that exited the market amid a drop in consumer purchasing power. Average rental rates across both primary and secondary malls in Cairo rose around 8% y-o-y and 14% y-o-y during the quarter. The average vacancy rate inched down 1 percentage point y-o-y to 8%.<\/p>\n

Hotel occupancy on the decline: <\/strong>Hotel occupancy across the city dropped to register 65% at the for the year by the end of March. Meanwhile, the average daily rate dropped 10% y-o-y to USD 123 in the same period, driving down the revenue per available room by 19% y-o-y to USD 80.<\/p>\n

More growth in the cards?<\/strong> \u201cThe long-term outlook for Cairo\u2019s real estate market remains positive, thanks to renewed confidence in Egypt's economy and a sustained demand for diverse types of asset classes,\u201d said JLL\u2019s Egypt head Ayman Sami, adding that \u201cthe market is poised for significant expansion.\u201d<\/p>\n

In the pipeline:<\/strong> Around 24k residential units, 1.4k hotel rooms, 402k sqm of gross leasable area for retail activity, and 555k sqm of office space are slated for completion this year.<\/p>\n

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