Egyptian authorities arrested the former housing minister a security source said on Wednesday, a step which may add to worries among real estate investors that land transactions made under previous governments may be voided.

Ibrahim Soliman was the second former housing minister to be arrested in connection with deals approved while in office, part of a campaign against corruption targeting figures from the era of deposed President Hosni Mubarak.

Soliman was responsible for several controversial contracts with real estate developers.

Property companies have already been reeling under a string of legal challenges contesting their land holdings since a court ruled last year that a deal with Talaat Moustafa Group (TMG) , the country's biggest developer, was illegal.

TMG has been in a long-running legal battle for its $3 billion Madinaty project because the land was not auctioned and was sold below market value.

That suit has prompted several copycat cases, including one against Egypt's second biggest listed developer Palm Hills and Egyptian Resorts.

Palm Hill's chairman and chief executive Yasseen Mansour is also facing trial in a case connected to the other housing minister, Ahmed el-Maghrabi, for profiteering and wasting public funds.

Maghrabi is accused of having improperly arranged the sale of land in Sixth of October near Cairo and its later transfer to Palm Hills via a foreign company specially set up to conclude the deal.

Soliman, who was minister from 1993 to 2005, came under fire from independent parliament members in 2009 for alleged corrupt real estate deals that involved family members and senior government officials. – Reuters