Cairo, Egypt: Colliers International, The Global Commercial Real Estate Leader, released its latest white paper on Egypt’s New Cities or Future cities as referred to in the report. The paper highlights the opportunities within those new cities, occupancy levels across key new cities in Egypt, key challenges and how to improve those cities and make them more desirable for the changing demographic.
With approximately 100 million people, Egypt is the most populous country in the Middle East. This has grown by almost five million over the past two years, of which 69% are under 35 years of age. This rapidly increasing population requires accommodation, schools, healthcare facilities, office space and retail / entertainment centers. However, why is Egypt facing challenges to attract more people to the new cities, despite of the rapid increase in population?
Mansoor Ahmed, Director of Healthcare, Education and Public Private Partnerships (PPP), highlighted that “With the exception of a few, occupancy rates across the majority of the new cities do not exceed 30% (according to the latest data by CAPMAS), especially the first and second generations launched in the 1970/80s. Average occupancy levels across first generation cities is 43%, second generation cities are approximately 23%, while the third-generation cities are struggling to exceed 15%. In order to create a self-sustained community where residents can live, work and play, social infrastructure is vital. Not only should there be sufficient housing to meet demand from various income segments, but also key drivers that keep residents within the community, such as community retail, F&B, schools, medical centers and supportable commercial spaces are essential to maintain occupancy levels”.
The report also highlights Job creation and the commercial elements required to support the growth.
Mansoor adds “Developments in new cities require an allocation of 15% and 20% of their land area for commercial and industrial use. This translates into more than 0.5 million feddans of land dedicated to commercial and industrial investments. This is a significant opportunity in both the private and public sectors generating employment opportunities in turn sustaining the development of communities in new cities”.