Minister of Housing Mostafa Madbouly estimated an EGP 35bn investment for the 500-acre project implemented by Palm Hills Developments in New Cairo.
Prime Minister Sherif Ismail attended the Ministry of Housing’s ceremony Monday to sign the fourth contract for the memoranda of understanding (MoU) signed in participation with the private sector during the Egypt Economic Development Conference in Sharm El-Sheikh last March. Palm Hills representatives also attended the ceremony.
Madbouly said the New Urban Communities Authority (NUCA) will obtain 42% of the project’s total revenues, at a minimum of EGP 14.7bn.
The 42% will be split into two parts; 10.4% representing the land value of EGP 10bn, and 31.6% for the project’s total revenue. Those will be paid to NUCA as a share of the entire size of project buildings, equivalent to EGP 4.7bn, which include residential, administrative and commercial activities.
Madbouly said the NUCA can ask Palm Hills to market its share by selling or renting, while it cannot market the entire project and divest NUCA of its share. He said Palm Hills will make an advance payment of EGP 50m upon signing the contract, and the remainder will be paid later; both entities will agree to appoint an auditor.
The land cannot be used for other purposes, and Palm Hills cannot deal on any piece of land before implementing the project and delivering NUCA’s share in full. Palm Hills is allowed to use sub-developers. The project will be implemented in eight years starting from the day of the first ministerial decision to approve planning.
The Ministry of Housing previously turned three MoUs signed at the economic conference in Sharm El-Sheikh into contracts. The Palms Hills contact marked the fourth, and a fifth will be signed within days, leaving only one to be confirmed. The total investment value of the MoUs amounts to EGP 135bn.