Egypt Imposes Fees on Slowly Executed Tourist Projects in the Red Sea

SadaNews - The General Authority for Tourism Development in Egypt has imposed new fees averaging around 700 EGP (13 USD) per meter on tourist and hotel projects in the Red Sea area, in exchange for a one-year extension to complete execution, as part of government efforts to reorganize the market and maximize returns from real estate and tourism projects, according to three sources familiar with the matter who spoke to "Asharq" on condition of anonymity.

One source stated that "the decision applies to projects that have an execution rate between 20% and 80%, while projects that have exceeded an 80% execution rate will receive the additional extension without incurring any new fees. He added that lands allocated for projects with execution rates below 20% will be reclaimed.

These measures come as part of a broader government initiative to reevaluate and manage real estate assets along the shores of the Red and Mediterranean Seas, alongside attempts to regulate the market.

Fees in the North Coast but with amendments

In recent months, the government imposed new fees on real estate projects in the North Coast and new cities, before making amendments to the calculation method, reducing the actual fee value by about 50% in some cases, according to government sources who spoke to "Asharq".

The government adopted a new calculation method based on the saleable built-up area instead of the total land area, which resulted in a reduction of fees imposed on developers by between 48% and 50%, according to three government officials who spoke to "Asharq" last April.

The amendments apply to foreign developers who are required to pay fees in dollars, as well as to Egyptian developers who have been issued ministerial allocation decisions for projects before February 2024.

A ministerial allocation decision is considered an official approval issued by the Ministry of Housing through the New Urban Communities Authority, granting the developer the right to allocate land and establish the project according to specific conditions, and is a prerequisite for starting execution.