The Gulf states and in particular Saudi Arabia and the UAE have witnessed a dramatic real estate and urbanisation boom in recent years, driven by mega-projects, government incentives, and surging investor demand.
Dubai recorded property transactions worth over $207 billion in 2024, while Saudi Arabia’s Vision 2030 strategy has fuelled developments like NEOM, pushing residential and commercial deals in Riyadh and Jeddah to $32 billion.
However, the US-Israel war on Iran and the latter’s retaliatory bombing of US bases in the Gulf could slow down this growth. In March, US investment bank Goldman Sachs reported a sharp contraction in real estate investment in the UAE, with a year-on-year decline of 37 per cent recorded during the first 12 days of the month and a month-on-month drop recording 49 per cent compared to February.
Although the Saudi market has been less affected by the Iran crisis, analyses published in March by the Global Property Guide point to a “cautiously subdued” outlook, with expectations that prices will continue on a downward trajectory in the coming months amid mounting geopolitical risks and oilprice fluctuations.
These factors have prompted questions over the impact of the crisis on Egyptian real estate developers investing in the Gulf, given earlier announcements by its top 10 real estate companies of plans to launch projects across the Gulf as well as demand by Gulf investors for Egyptian property.
Mohamed Fouad, a member of the board of the British Egyptian Business Association (BEBA), said “there are several reasons for the expansion of Egyptian development projects in the Gulf, most notable currency stability, abundant liquidity, and strong purchasing power. These factors have created a conducive environment for rapid growth and returns.”
The Egyptian market, he said, continues to possess strong fundamentals, foremost among them genuine demand driven by population growth and a persistent gap between supply and demand, with an estimated need for around 700,000 housing units annually.
This is in addition to the opportunities offered by the country’s new cities and national projects. Such factors render Egypt a market that cannot be overlooked over the medium and long term, particularly as “the number of development companies has grown from 75 in 2016 to around 2,000 in 2026,” Fouad said.
However, certain persistent challenges cannot be ignored, chief among them the erosion of purchasing power due to increasing inflation and a declining dollar-pound exchange rate, he added
The most likely scenario is for large state developers previously heavily investing in the Gulf to cautiously direct some of these investment back to Egyptian properties. Developers that do return will be those with strong financial standing, a long-term vision, and the capacity to devise flexible financing solutions aligned with market conditions.
“The current direction,” Fouad observed, “is towards longer instalment plans, smaller unit sizes, and cash discounts.”He expects developers to target a broader segment of buyers, rather than relying predominantly on higher-income groups.
Tarek Bahaa, CEO of Hometown Real Estate Development, said that Egyptian developers have neither exited the domestic market nor expanded into the Gulf to the extent that is sometimes assumed.
As such, it is not meaningful to talk of a “return”, as they have not, in effect, departed.
Meanwhile, Gulf investor interest in the Egyptian market is likely to increase, particularly as Egypt remains among the least affected countries by the crisis in the Strait of Hormuz, while also benefiting from a high degree of political and security stability.
Domestically, however, the 2026-2027 period is driving developers to return to the traditional fundamentals of the sector — namely, execution, delivery, and operation — in order to rebuild trust with clients, rather than relying on marketing campaigns and high-profile project launches.
Accordingly, the market may require a period to catch its breath until greater clarity emerges at the global level, after which it is expected to see more normal levels of demand, driven by population growth, tourism, and the diversity of real estate demand across segments.
Based on data from major Egyptian developers expanding into Gulf markets between 2023 and Q1 2026, alongside Stock Exchange disclosures and reports by JLL and CBRE, Egyptian firms vary widely in project scale.
The first group has achieved tangible success through established projects, advanced implementation, and actual sales—most notably Talaat Moustafa Group in Saudi Arabia and Al-Ahly Sabbour in Oman.
A second group has entered by securing land or final contracts, including Palm Hills Developments and Mountain View in the UAE.
A third remains at the level of announcements, MoUs, or legal entities without implementation, such as Hassan Allam Properties.
As geopolitical tremors shake the Strait of Hormuz, the ripples are being felt far beyond the oil markets. According to Mohamed Magdi Saleh, Head of Investment Research at Al-Ahly Sabbour, the current Gulf crisis is triggering a fundamental shift in how regional firms operate, turning a period of political risk into a strategic opening for the Egyptian real estate sector.
The repercussions of the conflict are no longer confined to macroeconomics. For years, Egyptian developers have ridden the wave of the Gulf’s urban boom, particularly in Saudi Arabia and the UAE. However, Saleh warns that this expansion faces a reality check as rising energy prices, inflated shipping costs, and surging material prices squeeze profit margins. These logistical strains may force a rescheduling of regional projects as cash flows weaken across the border.
Yet, where there is volatility, there is a search for stability. Saleh points to a notable reversal in capital flows as Gulf investors seek “safe havens” with high growth potential and low entry barriers. Egypt has emerged as a primary beneficiary of this flight to safety, bolstered by its massive domestic market, political stability, and competitive pricing further enhanced by a favorable exchange rate.
The anticipated surge in demand is expected to cluster in the North Coast and Red Sea districts. As geopolitical tensions cause a relative decline in competing regional tourism hubs, Egypt’s unique blend of leisure and investment is proving increasingly resilient.
The opportunity is immense, but it is not guaranteed. Saleh maintains that Egypt’s ability to fully capitalize on this pivot rests on its preparedness for the Summer 2026 season. Success depends on the readiness of tourism facilities, the delivery of a distinctive visitor experience, and the reach of international marketing campaigns. If the infrastructure meets the moment, Egypt may not just weather the regional storm—it may emerge as the region’s most fortified investment destination.
* A version of this article appears in print in the 30 April, 2026 edition of Al-Ahram Weekly
Short link: