(MENAFN - Daily News Egypt) Al Dau Development is looking for expansion across Egypt, Mohamed Salem, senior operations and commercial director at Al Dau, told Daily News Egypt in an interview, where he talked about the company's projects and development plan; the transcript for which is below, lightly edited for clarity:
What are the updates of the company's projects in West Cairo?
We aim to expand in core markets especially in Egypt which includes the company's major development projects, such as Pyramids Heights in West Cairo and Cairo West Residence which will be our first residential project in Cairo, in proximity to the Grand Egyptian Museum and Sphinx Airport.
How much investments the company has directed to its projects this year?
Al Dau Strand is one of the most important projects of the company in Hurghada, with EGP 1bn investments, spanning over 25,000 sqm and offering a total of 384 residential units overlooking the sea, all of which are distinguished by beach fronts and landscaping constructed on an area of 2,000 sqm with two marinas for yachts. The company plans to deliver Al Dau Heights' second phase during 2019. The first phase is expected to be completed by the end of the first quarter (Q1) of 2020. Mohamed Salem, senior operations and commercial director at Al Dau
What is the company's expansion strategy in the coming period?
Al Dau Development is looking for expansion across Egypt. Out of Al Dau's keenness to provide luxurious services to our clients, it's scheduled to open Al Dau Village Mall in Hurghada by Q1 of 2020. It will include a wide range of international brands along with top notch national brands to provide Hurghada's residents and shoppers with the best shopping experience amidst the increasing demand from clients in the area after the development of surrounding areas and roads.
What are the products your company intends to offer in the coming period?
We pay attention to all details to ensure the highest international quality of our various projects meeting consumers' and investors' aspirations and requirements whether in commercial or residential units.
What's the company's delivery plan?
Al Dau Heights's 1st phase has been completed and delivered. Our target is to deliver the second phase during the year. This phase comprises of 300 units. In addition, we aim to inaugurate the first phase of Al Dau Village Mall by Q1 of 2020, to be the first comprehensive mall in the Red Sea. It is being built on an area of 22,000 sqm alongside Al Dau Heights project. The total area of Al Dau Heights and Al Dau Village Mall is around 85,000 sqm.
What is the size of the company's investments in Al Dau Heights and Al Dau Strand?
Al Dau Heights' investments reached EGP 2bn with a total of 1,063 units. Al Dau Strand's investments stand at EGP 1bn for establishing 384 units, while Al Dau Village Mall's investments are EGP 500m.
Coastal areas in Egypt are transforming into first homes and there is a great demand by Egyptians on these areas specially the North Coast, Alamein, Hurghada, and Ain Sokhna. How do you see this?
Reviewing the history of the North Coast, we can find that the focus on the coastal areas is changing. Investments are moving between Marakia, Agami, Marabella, Marina, Sidi Abdelrahman, and Ras Al-Hekma in direction to Marsa Matrouh. We see that the area connecting between Ras Al-Hekma and Marsa Matrouh has become promising for tourism investment. This affirms that the North Coast sales will not stop in 2019.
What is the company's plan regarding real estate export?
We seek to provide various facilitations supporting foreigners' purchase of Egyptian real estate, including easing conditions of real estate funding because the current one applies to a limited number of units, which are not in the scope of foreign buyers' demands whether in relation to value or location.
Over the past two years, the clients of Al Dau Development varied between English, Germans, and Russians. A legislative amendment is required to promote real estate export. Foreigners have at least 100,000 units in Hurghada, and represent around 15% of Al Dau Development's clients. They are mainly English and Germans, and prefer units whose instalments range between €100-120. Usually, foreign buyers prefer studios and 1-bedroom units that range between 58-110 sqm.
What is your expectation for real estate prices after fuel price hikes?
The real estate market in Egypt is big and is very competitive, but this market is able to sort itself and only main players can provide excellent services at competitive prices.
Of course, real estate prices may see increases due to increased fuel prices, but real estate developers are offering large payment facilities that are very similar to bank financing services. With the increase in instalment periods of up to 10 years, to pay the instalments of the units that have been booked.
Unlike all expectations that the real estate market will slow down in 2019, the sales witnessed a boom during the first half (H1) of 2019. Please explain why? And what are your expectations for the H2 of the year?
The real estate market revealed the real need for non-residential units of all types other than housing units that investors used to put in the market, as the volume of investment demand for this type of units as indicated by recent market studies. As well as the current stage of great efforts to facilitate the registration of real estate, and activate the system of one window, and take a series of measures in support of investment. Through the opening of new markets and the provision of real estate products that meet the aspirations and needs of consumers and investors. Everyone should be well aware that demand trends are increasing towards real estate for investment, especially non-residential units of all kinds, medical, service, administrative, or commercial units, including recreational areas.
How do you see developers' participation in foreign exhibitions? Do you think this strategy helps in promoting Egypt's property export?
Real estate exhibitions outside Egypt are different, for example, Al Dau Development received an invitation to participate in an exhibition in China. The exhibitor asked the company to send representatives who speak Chinese. The exhibitions in China have a special character, which is completely different from local exhibitions.
The China Real Estate Exhibition is based on giving the opportunity for serious customers to meet with representatives of companies to negotiate the purchase after seeing all the projects. Each participating company knows the exhibition's details, dates, and the number of customers who will meet them.
However, in light of our participation in the London exhibition, it became clear to us the need to develop the philosophy of exporting real estate in general and that we need more international marketing efforts, and the real estate developers must open branches in the countries that target them and attract and recruit foreign marketing competencies.
In your opinion, what are the most in-demand areas in Egypt? And why?
Al Mansoura is a new and attractive investment zone that serves more than an area, such as Tanta, Alexandria, New El Alamein, New Mansoura, New Damietta, and the Suez Canal region which means that there is a large demand for investment in these areas, especially in light of the scarcity of land in the old cities and the strong purchasing power that exceeds the supply.
Do you see the launch of mega real estate projects by the government would improve economic performance?
When we highlight the important role of the government in the development process, it must not exceed the role of the development plan and not become a competitor to the real estate development companies. It can provide the land to facilitate the process of investment and development, and its role in providing the integrated service areas that lead the development movement in any city. This is a kind of long-term investment, but it must be offered at a distinguished level that attracts customers and serves development in the cities of Upper Egypt and the new urban cities whose services are sought by the pioneers. They are available in the capital and the cities of greater Cairo.