Real estate associations call on authorities for support: Some in the real estate industry are asking for state support as they battle the economic headwinds that the rest of the business community is presently facing. In a list of demands submitted earlier this week, the real estate divisions of the Federation of Egyptian Industries (FEI) and the Federation of Egyptian Chambers of Commerce (FEDCOC) are asking the government for a package of measures that would provide favorable lending terms and loosen rules for delivery times in a bid to help them withstand soaring inflation rates. We spoke with a number of industry players to see what they’re looking for:

More time to deliver: Developers are asking authorities to give them a breather by extending project deadlines by 9-12 months and exempting them from late delivery fines, Mohamed El Bustani, chairman of El Bustani Group and head of the Real Estate Developers Association in New Cairo and the new administrative capital, told us. Contractors working on government projects are requesting a 4-6 month extension, according to Mohamed Sami Saad, head of the Contractors Union. Under regulations introduced last year, developers have to complete projects within a specific time frame agreed with the Housing Ministry and face legal penalties if they don’t deliver on time.

Preferential borrowing costs: Industry figures want companies in the real estate sector to be included in the government’s new subsidized loan program, which is set to offer EGP 150 bn worth of loans at a subsidized 11% interest rate. Announced last week, the soft loans are currently only expected to be made available to companies in the industrial and agriculture sectors. Construction and real estate companies previously had access to subsidized loans under the central bank-backed scheme which has been scrapped as part of Egypt’s UD 3 bn loan agreement with the IMF.

Debt restructure + favorable repayment terms: Developers are also angling for upcoming repayments to be rescheduled and for the government to collect payments for newly-sold lands over long-term periods of up to 10 years.

Attracting foreign investment: They reiterated demands for measures to increase their ability to sell property to foreigners in foreign currency and make it easier for them to purchase property.

A chat with Abdalla: Developers also want a meeting with CBE Governor Hassan Abdalla to discuss looser financing solutions to make it easier for prospective homebuyers to purchase property amid soaring prices. This includes pushing for an approach that collateralizes the property being purchased rather than the borrower’s credit capacity.

The real estate sector has been coping with heightened inflation for almost a year in the wake of Russia’s invasion of Ukraine. Soaring prices of building materials, import restrictions, and rising interest rates have pushed up costs dramatically and led to a slowdown in the industry. In parallel, the state has not reduced what it charges developers for land; industry players have for some years now warned that land prices are prohibitively high, driving up the prices of new builds.

Some firms are at risk of going bust: Prices of building materials have roughly doubled in price and the fall of the EGP against the USD in recent months could push some developers into insolvency, Alaa Fekry, chairman of Beta Egypt and member of the FEDCOC Real Estate Investment Division, told us. “The question is who will be able to continue and who will not. Not all companies will be able to continue.” Fikry anticipates property prices to rise by at least 30% this year on the back of rising material costs.

The government has provided some support already: In July, the government gave developers a six-month deadline extension to complete ongoing projects in new cities after the Egyptian Businessmen’s Association submitted a list of demands in April that included rescheduling repayments and extending project deadlines.