Dubai-based mall developer Majid Al Futtaim Properties, has moved forward with the foundations at its $800m Mall of Egypt project and 70 percent of space in the Cairo-based has already been let out to tenants, despite the ongoing unrest in the African state, a leading executive told Arabian Business.
MAF Properties secured US$450m worth of financing to fund Mall of Egypt from a consortium of banks led by National Bank of Egypt and Banque Misr and it broke ground on the project last spring.
The $400m construction contract has been awarded to a 50/50 joint venture between Orascom Construction and BESIX Group.
“We have just broken ground and are a little further on than that, we have put some of the foundations in,” Jonathan Emery, managing director of property development at MAF Properties, told Arabian Business on the sidelines of a construction conference in Dubai.
The mall will be built on 399,400 sqm of land outside Cairo and will include North Africa’s first manmade indoor ski resort, similar to MAF Properties’ Ski Dubai in Mall of the Emirates, about 380 retail outlets, a Carrefour hypermarket, 17-screen cinema complex and an amusement park. It is due to open in late 2015.
Despite the ongoing unrest in Cairo, Emery said MAF Properties was committed to the project and it had not seen any decline in demand for space.
“We are carrying on… We are about 70 percent pre-let,” he added.
Iyad Malas, CEO of parent company MAF Holding, in January said he was confident in the Cairo market and the company would persist with the project.
Malas said sales in the company’s two existing malls in Egypt, in Alexandria and Maadi, rose 24 percent last year compared to 2011, during the height of political disturbances.
MAF Properties said it is also planning to expand into Georgia, Kazakhstan, Armenia and Azerbaijan in the near future, starting with Georgia as early as this year.
In April, MAF Properties also opened its first mall in Lebanon and Malas said a second mall was planned for the new Beirut Waterfront project, with construction to possibly start this year.
The company, the largest private shopping mall developer in the Middle East, said its revenue grew 10 percent last year compared to 2011, to AED21.6bn ($5.88bn).
Earnings before interest, taxes, depreciation and amortisation (EBITDA) increased 7 percent to AED3bn. Excluding currency depreciation in Iran, EBITDA grew 9 percent.
The company said its balance sheet remained strong with total assets valued at more than AED38bn, with AED7bn debt.
MAF Properties contributed about 65 percent of MAF Holding’s EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), with revenue increasing 15 percent to AED3.2bn. The company’s malls saw about 147m visitors during 2012.
MAF Retail, which operates the Carrefour franchise, saw 8 percent growth in revenue, rising to AED17.8bn, contributing 31 percent of the group’s EBITDA. MAF Ventures, which operates the group’s leisure and entertainment facilities, increased its revenue 11 percent to AED806m.
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