Egypt Imposes Fees on Real Estate Partnership Projects in New Cities

SadaNews - The New Urban Communities Authority, affiliated with the Egyptian Ministry of Housing, has imposed new fees on real estate projects implemented under partnerships between more than one entity within the new urban cities, according to a government document.

According to the document, the minimum fee is 1000 EGP (about 19 USD) per square meter for projects developed by Egyptian developers, with 20% to be paid upfront, and the remaining amount to be paid in equal installments over a year without interest, or 80% of the fees to be paid over five years at an interest rate of 10%.

In contrast, the fee is 20 USD per square meter for projects developed by foreign investors, to be paid in one lump sum.

Businessman and Egyptian real estate tycoon Naguib Sawiris has previously considered these fees to be "illegal."

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The fees apply to all lands on which real estate partnership projects are built within the new cities, including areas east and west of Cairo, and lands in the North Coast, with the exception of Upper Egypt cities, as well as the cities of 10th of Ramadan, 10th of Ramadan Gardens, New October, New Obour, and New Suez.

The new regulations also stipulate the suspension of dealings with non-compliant real estate development companies until they rectify their status and pay the due fees, which includes the suspension of government services such as electricity and water and division decisions, until financial procedures are completed.

This move follows previous decisions made by the authority during the past year, which included imposing fees on partnership projects in the North Coast, ranging from 500 EGP per square meter for lands south of the coastal road, to 750 EGP north of the road, and 1000 EGP per square meter for lands with a beach frontage.

The authority also imposed fees for road improvements reaching 1500 EGP per square meter on developers who own lands or projects up to 7 kilometers deep on both sides of the Cairo-Alexandria Desert Road.

According to the document, the revenues collected by the New Urban Communities Authority from these projects will go to the government "Tahya Misr" fund.