Real-estate circles in Egypt were in disarray this week after several leading developers faced the risk of having their plots withdrawn, others were handed hefty fines, and some suffered from delays in the issuance of the ministerial decisions needed to begin development.
The crisis involves high-profile Egyptian and foreign developers, including companies active in key Arab capitals and widely trusted by Arab and Egyptian investors.
Social media pages concerned with real estate in Egypt published leaked documents, including an official letter instructing the New Urban Communities Authority, which operates under the Ministry of Housing, to temporarily suspend dealings with 123 companies operating in the North Coast until their legal and administrative status is clarified.
The companies have reportedly been allocated a combined area of 4,000 feddans, estimated to be worth LE110 billion, according to discussions on social media by developers and marketeers.
In the same week, another letter was leaked, revealing the imposition of “improvement fees” on developers operating in the North Coast ranging from LE500 to LE1,500 per square metre depending on the size and location of the land.
Some media outlets have questioned the timing of the leaks, given their impact on major local and regional real-estate developers at a time when property sales in Egypt, especially along the North Coast, are at their peak.
A source familiar with the procedures of the New Urban Communities Authority, who requested anonymity, said that “this is not a crisis, as portrayed on social media. It is normal for any economic authority to follow up with its clients regarding dues, obligations, regulations, and the terms governing land allocations, as well as to monitor implementation plans in line with national development objectives.”
According to the source, it is standard practice for developers to be formally notified of any updates regarding their status and for the relevant authorities to follow up on them, investigating any delays in fulfilling contractual obligations or implementation plans.
These matters, however, are typically handled away from the media and social media platforms, which are not considered appropriate forums for such discussions, he added.
Mohamed Al-Bustani, head of the New Cairo Developers Association, justified the state’s pressure on the developers, saying that it must meet the many obligations it is committed to.
He noted that the association had sent a letter to the Ministry of Housing and the Board of Directors of the New Urban Communities Authority, outlining key requests including the granting of a grace period to developers behind on land installment payments, extending the deadline in ministerial decrees requiring projects to be begun from three months to one year, and rescheduling the debts of companies facing land withdrawal decisions.
“However, we have not yet received a response from the authority,” he stated.
Osama Saadeddin, advisor to the Real Estate Development Chamber at the Federation of Egyptian Industries, noted that the chamber and the Ministry of Housing are in talks to resolve issues facing the country’s real-estate developers, including the 123 companies operating in the North Coast that are members of the chamber.
“The case of each company will be studied individually. Other real-estate companies are facing problems, but they are not members of the chamber. In this case, the chamber is not authorised to negotiate with government entities on their behalf,” he explained.
“In general, some developers are struggling to pay their installments, while others are facing delays in obtaining the necessary permits to begin developing the allocated land. Some companies have changed their core activity, which has required altering part of the designated land use. This involves paying fees to amend the land-use activity,” he added.
Saadeddin declined to disclose details of the negotiations pending the ministry’s final decisions on the status of developers who are members of the chamber.
The chamber is also in talks with the Ministry of Housing and the New Urban Communities Authority regarding the imposition of improvement and development fees on areas along the North Coast, particularly near Ras Al-Hekma and New Alamein.
The fees have been estimated at a maximum of LE1,500 per square metre with the objective of funding large-scale infrastructure and development projects in the area to be implemented in phases over the next three to five years, Saadeddin added.
These development projects are meant to improve the area’s infrastructure, ultimately leading to higher sales and profits for developers and their clients, he pointed out.
“The developers are partners with the state in development and in attracting local and foreign investment. Hence, they do not object to paying the improvement fees. Nonetheless, the negotiations concern the collection of the fees according to a phased schedule in line with the implementation timeline of the development plan,” he said.
“The developers know that the state needs to upgrade the area’s infrastructure and coastal front in line with the plans for Ras Al-Hekma. The upgrades are essential to delivering returns and development opportunities in the city,” he added.
“We believe that the decision to impose improvement and development fees to fund infrastructure and coastal upgrades is fair,” Saadeddin said. “It is logical for the developers to bear the costs, but chalet and property owners are also partners in this process and will directly benefit by increasing the value of their assets in the North Coast.”
Having a schedule for fee collection tied to the stages of the upgrades would help developers and clients see a clearer picture, he noted.
“Whether a buyer plans to buy a unit at present or wait for a later phase, or if they already own one and intend to sell it, knowing when the infrastructure improvements will be completed will help them determine the best timing for investment or resale to maximise returns.”
* A version of this article appears in print in the 14 August, 2025 edition of Al-Ahram Weekly
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