Damac in $5.4bn Cairo project

UAE-based Damac Holding will spend 30 billion Egyptian pounds ($5.42 billion) over 10 years on a residential and commercial project near Cairo to tap demand for housing in Egypt, company officials said on Tuesday.

The company bought 6.3 million square meters of land in an auction last May and will build villas, parks, and commercial space in the latest development in Egypt by Gulf Arab investors.

"There is economic growth and population growth in Egypt so prices should continue to rise," Damac Chairman Hussain Sajwani said at a news conference.

Damac opened the first phase of the development, located in New Cairo east of Egypt's capital, on Tuesday. Villas on a 4.7 million square metre lot were priced at an average of 2 million pounds, officials said.

Damac, with a total portfolio of more than $30 billion, is also developing a $16.3 billion residential and tourism project on Egypt's Red Sea coast and a 2 billion pound commercial and retail venture in 6th October City west of Cairo.
The Gamsha Bay project, 80 km (50 miles) north of Hurghada town on the Red Sea, will include hotels, 5,000 villas, an 18-hole golf course and a marina.

About 20% of the Dubai-based company's revenue could come from Egypt by 2009, said Damac Chief Executive Peter Riddoch. Currently up to 80% of revenues come from the UAE, with the rest from developments in countries including Jordan, Lebanon, Qatar and Saudi Arabia.

"We like what we see in Egypt with the growth of the middle class," he said.

Egypt's economy surged 7.1% in the fiscal year ending in June, its fastest rate of growth in at least two decades.

Damac's UAE-based competitor Emaar Properties said in April it would start two real estate projects in Egypt, bringing the total value of its projects in the most populous Arab country to $5.5 billion. (Reuters)

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