Sodic boss expects real estate to stage recovery starting 2H2020: Property sales could start bouncing back throughout the second half of this year after the government relaxed covid-19 measures and amid the ongoing gradual return to “normal life,” our friend Sodic CEO Magued Sherif told Al Mal and Hapi Journal in separate interviews. Expectations are that activity in the market will fully return to pre-covid levels during 1Q2021 or sometime in 2Q2021 in a more conservative outlook, says Sherif. The upmarket real estate developer is currently revising its 2020 sales target, which it expects to fall short of a previously forecast EGP 8.4 bn. Sodic’s board is due to start discussing within two weeks several scenarios for the pandemic-induced slowdown, Sherif adds.

Sodic is on the lookout for expansion prospects as the future looks clearer, says Sherif, noting that “we have reached a [higher] level of reassurance” when it comes to the pandemic. The company had previously earmarked EGP 3.7 bn in investments this year, split between construction work and prospects in the North Coast, Sheikh Zayed, and close to the new administrative capital. This figure will likely be revised downward as all construction work in Egypt was suspended for two consecutive weeks earlier during the pandemic, says Sherif.

The company is still building up its land bank and is eyeing new land acquisitions in the coming period, backed by a strong financial position, Sherif says, noting Sodic had some EGP 3.85 bn cash in hand by the end of 1Q2020. Debt is also an option for Sodic to finance the purchases, particularly as the company has a “distinguished relationship with banks” and is currently studying several other financing options including receipt factoring, he says

Sahel plans underway: Sodic recently held meetings with officials from the New Urban Communities Authority (NUCA) to launch a new phase in its planned Malaaz project in the western strip of the North Coast, he says. The chief executive hailed the recent transfer of land ownership in the area to the centralized, more experienced NUCA from local municipalities. Sherif, however, believes the Housing Ministry should double to six months a grace period it provides to construction firms to help builders and developers cope.

Other highlights:

• Sodic is in talks with AAIB for a EGP 2.5 bn loan to finance construction at Villette, and expects an agreement within three months;
• The company has invested nearly EGP 1.3 bn in EDNC, its first non-residential complex, due for delivery in November 2021;
• Its recently-launched online platform kept sales afloat amid the pandemic, helping the company retain its large expat and foreign customer base, which purchase 18% of its properties;
• The company is interested in building in the new capital, but is yet to commit to a formal plan.