Saudi-UAE consortium withdraws from major investment project in Egypt

An official source in the consortium that includes the UAE’s Al-Shafar Group and the Saudi Egyptian Construction Company, has announced its withdrawal from a project to develop land belonging to the now dissolved National Democratic Party (NDP) overlooking the River Nile in downtown Cairo. The source cited the high costs resulting from the decline in the value of the Egyptian pound, reported Bloomberg Middle East.

The Egyptian government allocated the project to develop this land to two companies affiliated with the Sovereign Fund of Egypt in March, namely Nilus for Hotel and Commercial Services, and Nilus for Residential Services. The source noted that the shares specified for the consortium were based on the evaluation of the price of the land versus the buildings, but that these shares were affected by the decline in the value of the pound and the increased prices of raw materials and energy.

The project aims to build two towers. One is a 75-storey hotel with office and commercial units, and the other is a 50-storey residential building with 446 luxury residential units.

In September 2020, the Egyptian government allocated approximately 16,500 square metres of NDP-owned land overlooking the Nile to the Sovereign Fund after years of controversy over ownership between the Ministry of Antiquities and the Cairo Governorate.

Over the past two years, Egypt has witnessed significant fluctuations in the exchange rate between the official and black currency markets, which has affected various sectors, including real estate development and the prices of raw materials. It has also led to the emergence of a black market for such materials.

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