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Cairo’s residential market performs real estate market, says JLL

DUBAI, 19 days ago

The real estate market in Egyptian capital Cairo remained stable in second quarter despite challenging global economic conditions, according to real estate expert JLL.
 
Despite a slowdown in Q2, the residential market performed comparatively well on an annual basis and it saw the completion of one project in Q2 2020, bringing the total stock to 159,000 units. Around 35,000 units are currently under construction and are expected to be completed in the second half of the year, stated JLL in its Cairo Real Estate Market Performance report. 
 
In order to attract new developers and investors in the long term, the Central Bank of Egypt (CBE) has reduced interest rates by 3%, the lowest rate since 2016, with the aim to support and finance projects through bank loans rather than relying on off-plan sales, it added.
 
“The real estate market in Egypt continues to benefit from the various initiatives that have been put in place by the government across all sectors. We anticipate this to continue driving demand and attract international investments in the mid-to-long term,” remarked Ayman Sami, Country Head, JLL, Egypt.
 
Primary and secondary rents in the retail market have increased by 5% to 10% annually. These are expected to remain stable with mall operations gradually getting back to normal. Landlords continue to offer incentives to support tenants that include waived service charges and rent free periods. 
 
Some landlords have also adopted a revenue-share model to support retailers to account for the loss of sales. 
The e-commerce is still on the rise as consumer preferences lean towards online shopping, allowing for a prominent number of home-grown businesses to emerge, said JLL in its report.
 
The office market in Cairo will continue to be a two-tired market and while the demand is high for smaller fitted-out primary office space, the requirement for flexible office space is expected to witness a slowdown in the short-to-medium term. This is due to small-to-medium enterprises (SME’s) and start-ups now realising they can work from home, it stated.
 
The government continues to support the sectors most impacted by the pandemic with initiatives such as allowing corporates to pay income tax in three installments rather than one, it added.-TradeArabia News Service



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