36 | THE EGYPT REPORT Q&A panel


www.opp.org.uk | AUGUST 2010


is helping to facilitate both foreign and local investments. Returns are easily forecasted and most projects and investments make very promising returns in their fi rst year.” Aliaa Hussein.


Are land prices rising ... can you give OPP some examples? “Around fi ve years ago, the Egyptian government began selling off former military land in order to satisfy increasing demand for prime locations. When this land was released, it was offered to local developers and


businessmen for as little as $1 per m2 and thousands of square metres were snapped up. However, there was a requirement to have 40% of a structure in place within fi ve years or risk losing the land back to the government. This led to a fl urry of construction activity and part-fi nished buildings now looking for investors to fi nish them. Prices have since risen to around $100 per square metre for 2nd and 3rd line property to as much as $350-plus per square metre for front line beach plots (based on freehold plots in Hurghada). In Cairo, prices vary; prime building land in Zamalek is now fetching $6,250 per square metre and in Giza as much as $13,500 per square metre.” Peter Mitry.


What are the general commission structures like for agents in Egypt? What would be typical? “It depends on the location. For


instance, Cairo is between 2% to 3% while the Red Sea market reaches 5% to 6%. Other small developers offer more than 8% commissions because they don’t have their own sales team and solely depend on agents or the brand name.” Amin Serag.


“Egypt was new to dealing with overseas agents 7 years ago. The custom with local realtors within the Cairo region was a commission range of 1.5% to 2% from both the buyer and the seller. Now, as the residential tourism sector grows, things are changing and a ‘ no buyer commission’ is a key marketing tool.


Commissions from developers


elsewhere in Egypt range between 4% and 10%. Some apply an escalating scheme … others relate it to the sales volume. Yet, it is mostly related to the value of the property and the effort required to close the deal. The amount of


marketing the estate agent performs to promote the specifi c development is also important.” Aliaa Hussein.


“Typically commissions range


from 5% to 10%. For resales, 5% is the norm, while off-plan projects typically offer around 8%.” Peter Mitry.


“They average 5% for most developers and we have a commission structure of up to 10% for agents.” Tarek El Saadi.


“Typically for foreign agents we see between 10% and 20% being offered.” Ian Marsh.


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EGYPTreport


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