JLL released its 2015 annual review of the Cairo Real Estate Market, assessing the latest trends in the office, residential, retail and hotel sectors.
According to JLL’s Cairo Real Estate Market Overview for 2015 report, Cairo real estate market has weakened in various segments in 2015 which was impacted by currency devaluation, restrictions on capital outflows, construction delays, occupier vacancies and security concerns.
“While the Cairo real estate market experienced robust growth over the first half of 2015, a combination of economic, political and security uncertainties have taken some of the steam out of this growth and the market has generally cooled over the past few months. As a result, we witnessed mixed performance across the office, residential, retail and hotel sectors during 2015It is encouraging to note that the Egyptian government is proposing structural reforms, state incentives and major infrastructure spending to attract much needed foreign investment, which will eventually trickle down to the real estate market. This government support is contributing to a continuation of positive sentiment which is leading some developers to announce new projects.” said Ayman Sami, Head of Egypt Office at JLL MENA.
“It is interesting to note that Cairo residential completions remained somewhat lower than in recent years, on the back of continued construction delays across a number of developments. The delays in project handover reflect both over-optimistic assumptions by developers and the slowdown in the level of pre-sales. Continued delays are expected in 2016 due to the unforeseen rise in construction costs as a result of the devaluation of the local currency and the restrictions imposed on the importing of construction materials. The residential market in Cairo exhibited very mixed conditions during 2015. In general terms the sale market outperformed rentals but the pace of growth in both markets slowed in the final quarter, probably as a result of continued uncertainties around the value of the EGP. Demand continues to be driven by families moving from central areas to less crowded satellite cities.” he added.