Magued Sherif
Managing Director of SODIC
Real Estate & Construction / Egypt
Widening gap in demand “real driver” of Egyptian real estate market
Headquartered in Cairo and listed on the Egyptian stock exchange, SODIC is one of the country’s leading real estate developers with cumulative contracted sales of $1.7 billion and over 9,400 units sold. This year, SODIC continues its central role in tackling the country’s ever-growing demand for high-quality housing by acquiring new plots of land. Magued Sherif, Managing Director of SODIC, explains SODIC’s vision and founding principles of operation.
What is the largest trend driving Egypt’s real estate market?
The real estate market is insufficiently supplied to meet pop ulation growth. For example, Egypt has a current real estate demand of 3 million units that grows by about 400,000 units annually. Meanwhile, private developers only provide 20,000 units a year. This ever-widening gap is the real driver of the real estate market.
How will the Egyptian pound’s devaluation affect the sector?
With a cheaper Egyptian pound, property will become more affordable for foreigners. In particular, Egyptian expatriates will have an incentive to reinvest in their country through cheaper property. This is a likely scenario, as Egyptians are homebuyers by nature and have always preferred real estate as an asset class for storing wealth and hedging against inflation.
How do current sales reflect the health of the real estate market?
SODIC is one of Egypt’s leading real estate developers, and this is reflected in our earnings: our net profit margin came in at 21 per cent in 2015, which is close to double our margin in 2014. In 2015, we achieved sales of $450 million, about 43 per cent higher than 2014. We delivered about 721 units last year, which is higher than planned. Looking forward, we have already started the year by signing a revenue-share agreement with Egypt’s Heliopolis Company, whereby we will jointly develop 2.751 million square meters of land over the next decade.
What is SODIC building to supply growing demand?
In 2016, SODIC will launch new phases of our existing projects on the North coast, as well as in East and West Cairo. This is in addition to launching the first phases of 30 acres of newly acquired land in West Cairo during the second half of the year.
What sets SODIC apart?
To date, SODIC has developed over 6 million square meters of land and brought over 3 million square meters of built up area to the Egyptian market. It is our staunch commitment to delivering on our promises to all our stakeholders that sets us apart from the competition. This includes our commitment to timely delivery to our clients and delivering consistent quality while continuing to maintain strong growth through the acquisition of new plots of prime land. We are also growing our recurring income streams — not only do we sell property, we also retain retail and commercial projects. It is because we honour our commitments even during the most challenging macro-economic operating environments that SODIC has earned and maintained its strong reputation in the Egyptian real estate market.
