LIVING "By the Real Estate Leaders" Fall 2015 - Issue #7 | Page 9

So how is the plan for the new capital affecting development in the area? MH: I imagine that in 20 years, Sokhna will be comparable to the Fifth Settlement now. The new capital is expected to develop in the area between Madinaty and Sokhna, and that is partially why prices are going up. The other attraction is that Sokhna is still the only beach resort in Egypt that is just one hour away from Cairo. MG: There are still a lot of negotiations about the new capital, and it may end up that they develop the administrative zone and wait on the rest of it, but the idea that it is being developed is enough to bring investors to the area. At the end of the day, buyers think of it as a package: they buy property in the Fifth Settlement or 6 October City, and they have to have a place in the North Coast and a place in Sokhna. I think that the new capital will change things and that people will be more willing to make larger investments in the area. But the problem remains that Sokhna is still a weekend destination, and even then it only reaches 30-40% occupancy, unlike Sahel, which runs for three months a year. This is why there are fewer services in general. Shamm El Nessim is probably the only time that you’ll find large numbers of people in Sokhna, and even then it is limited because Gouna attracts a large crowd as well. In the past few years, it seems that summer and winter destinations are not as rigid as they once were (i.e. many vacationers go to the Red Sea in the summer). Do you think that this distinction between summer destinations and winter destinations still exists for buyers? MH: I think that the government is working to change this over the next few years with destinations like El Alamein City on the North Coast, which is being developed as an actual city that will run all year. Also, the infrastructure that Emaar has developed in Marassi must be used all year as well, so I think things are changing in Sahel. Sokhna is also changing because of the new capital, and it will probably become a year-round destination as well. I think that, in the future, all of these destinations will be used all year, but people will still prefer to go to Sokhna in winter and Sahel in summer. MG: There is also a difference in crowds – people don’t just look at the weather. Some people follow the parties and others try to avoid crowds, so it depends on what individuals want as well. What do you expect will happen to the price of property in Sokhna in the coming period? Sokhna is also an area with many factories. Does that affect the price of property? MH: I don’t think it matters to most clients and very few of them care about this. One client was telling me that he was concerned about pollution in the area, especially after the expansion of the canal, but this was a very rare case. Generally, clients look at two things: the name of the compound and who lives inside. Even if the beach is rocky – which is the case in many areas - most people don’t mind. They just care that they have a view of the sea from the villa, and that their neighbors are decent people. If you really think about it, Ras Sedr is the best destination in Egypt; it has the best weather, good wind, the beaches are nice and sandy, but nobody really goes. So people invest more in communities and the name of the developer. But does the environmental factor affect the sustainability of the area over the next 20-30 years? MH: I think that in 20 years, Sokhna will become a residential area and that the coastline to Hurghada and beyond will be developed. Once it becomes a residential area, it will not matter if it is polluted. In 20 years, it will be considered very old and people will be attracted to a new area, because that is how things happen in Egypt; we develop areas, exhaust them and then we move on to something new rather than trying to fix things, and this is exactly what happened in Sahel. The other factor is that President Sisi made a very good decision regarding the area between Zaafarana and Hurghada; he has prevented the development of any compounds in this area, so it is expected that it will be a corniche, which is the best way to bring life to this area. This is how people think anywhere outside of Egypt; they develop public beaches on the beachside and build properties on the other side. How important is the developer’s role in the stability and sustainability of a compound? MH: The developer's name is crucial and people are right to follow the name or reputation when it comes to investment. When a developer grows, he cares about his reputation, because he knows that if he fails once, he will not have people's trust in the future. I think this is the number one decision-making factor for certain people, partially because it builds trust, and also because it is tied to a certain community. MH: The price of property is already rising, and buyers are starting to compare investing in Sokhna to investing in Sahel, but up until now, Sokhna is still cheaper than Sahel. This year, we are seeing prices go up to EGP 12,000-13,000 per square meter in Sokhna, whi