Majid Al Futtaim to invest $3.4bn in Egypt over five years in first move into housing
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Majid Al Futtaim plans to invest about $3.4 billion in Egypt over the next five years — more than it has spent in the country in 27 years — with close to $3 billion earmarked for the Mada City development east of Cairo and $400 million for projects beside Mall of Egypt.
Majid Al Futtaim will invest around $3.4 billion in Egypt over the next five years, more than it has spent in the country in 27 years, Khalifa Bin Braik, chief executive of Majid Al Futtaim Asset Management, told EnterpriseAM. The Emirati group’s cumulative investment in the Egyptian market stands at about $2.8 billion.
Close to $3 billion of the new money goes to Mada City, the integrated city east of Cairo that the group is developing in partnership with Midar. The remaining $400 million funds developments adjacent to Mall of Egypt in west Cairo. The first is ELMNT33°, unveiled on Monday with an EGP 457 million price tag, spanning 5,300 square metres and combining dining, lifestyle and flexible co-working.
Mada City is the group’s first residential and hotel development in Egypt. “This is the first time we’ll go into residential,” Bin Braik said. “We decided to because we saw the demand is there, and investors and residents see big demand in this sector.” Preliminary works on Mada City are expected to start within 12 to 18 months, kicking off a multi-year buildout spanning housing, office space, hotels and a retail mall.
The second west Cairo project, Junction, is the group’s first business complex in Egypt, carrying a total cost exceeding $386 million for its first phase. The group is also partnering with Ennismore on a 25hours-branded property at Junction, with operations expected to start within three years.
The expansion is a wager on Egyptian housing demand at a point when the buyer base is thin and the market is being restructured under a draft law governing who can build. Households able to carry current asking prices in the new cities start at a monthly income of EGP 150,000 and make up about 6 per cent of Greater Cairo’s population. Majid Al Futtaim posted record first-half EBITDA of AED 2.5 billion, up 11 per cent year on year, on revenue of AED 17.5 billion, with markets outside the GCC growing revenue 4 per cent on strong growth in Egypt and Kenya. Its SHARE loyalty programme, which has 14 million customers across the UAE and Saudi Arabia, will launch in Egypt shortly.