Egypt’s project market worth in the real estate sector stands at $395.7 billion, the 2018 Oxford Business Group Report on Egypt states, with the sector forecast to grow at a compound annual rate of 8.03 percent until 2021. While many are worried about a real estate bubble bursting and causing a sectoral downturn, founder of Dar Al Mimar Group (DMG) and chairman of Mountain View Amr Soliman suggests otherwise.
Having Mountain View and Idrak under its umbrella, DMG has member companies in the engineering, real estate and hospitality sectors.
Business Forward sits down with Soliman to talk about the theory of the real estate bubble in Egypt, the relationship between the government and the private sector and the best way to move forward.
Describe the 2018 real estate sector in Egypt in three words.
Very competitive, risky, high potential.
What is your take on the real estate bubble theory?
We talk too much. We need to rely on a scientific way to evaluate the real estate bubble. The scientific way is to look at supply and demand. So, do we have demand? Yes, we have big demand because of the growth of the population and number of marriages – this makes the industry grow. We also have big supply – and this is the competitive part. I would rather say it’s a competitive market, than a bubble market. Where is the bubble happening? Maybe in Dubai because it’s like a transit city. But in Egypt, we have real demand. As long as we have real demand, we have an industry.
What piece of advice would you give people who are entering the real estate market?
You are jumping into a very competitive market. My advice for those who are starting to enter the real estate market is to look after their efficiency, make sure they are innovative, not give bad promises, make sure to build trust in the market and do more than they say.
How would you evaluate the relationship between the government and the private sector in the industry?
The relationship between the government and the private sector is a good one because the government is realizing that it is the big developer and it sees the need of a win-win situation in partnership with the private developers. All the private developers are the small developers and the government is the big one. The government needs to be the regulator and the driver of the market.
What is the best way to move forward?
International standards are the way to grow. We need to adopt them. If these standards are absent, you are not competing globally and you are out of the game.