Egypt is seeing a big increase in luxury real estate projects funded by Gulf countries like the UAE and Qatar. Since 2021, the Gulf has invested around $59 billion in Egypt’s real estate market, especially along the Mediterranean coast and in new cities. Big projects include Ras El Hekma by the UAE’s Modon and the $30 billion Alam Al-Roum development by Qatar’s Qatari Diar near Marsa Matrouh.
Major Projects and Their Scale
- Ras El Hekma: Funded by Abu Dhabi with a $35 billion package, this project is turning a large part of Egypt’s North Coast into a luxury resort city. The Egyptian government owns 35% of this project.
- Alam Al-Roum: Qatar’s $30 billion plan aims to build a new luxury city accessible from Europe, covering 40 square kilometers with homes, marinas, golf courses, and more.
- Emaar’s Marassi North Coast: Dubai-based Emaar is expanding with $1 billion more investment, developing hotels, golf courses, and high-end housing.
Economic Benefits and Concerns
These large projects bring in hard currency and create jobs, which is important for Egypt’s young population facing unemployment. They also attract wealthy local and foreign buyers, many seeking second homes or golden visas.
However, prices are very high. At Alam Al-Roum, homes start at about $233,000 in a country where the average income is just over $3,000 per year. This raises questions about how sustainable the market is for ordinary Egyptians.
Egypt Faces Financial Challenges
Egypt must pay nearly $71 billion over the next three years to service foreign debt. While Gulf investments help, the country still faces risks due to short-term loans and economic challenges. The government has acted to improve conditions by reforming older rental laws and reducing subsidies on gas and fuel.
Growing Demand and Rising Prices
Luxury real estate prices have risen quickly, with villa prices on the North Coast increasing about 15.8% year-on-year. Many wealthy Gulf investors are actively buying properties in Egypt to diversify their investments and benefit from residency-linked visas.
Opportunity with Risks
Gulf investments are transforming Egypt’s luxury real estate market and boosting the economy. But heavy reliance on high-end buyers and foreign money means challenges remain, especially around affordability and debt sustainability. Careful management will be needed to ensure lasting benefits.
Image by Tamer Soliman from Pixabay
