Mariam El-Saadany, a real estate analyst at HC, said that the revaluation of Red Sea land and strong tourism revenues enhance the value of Orascom Development Egypt’s shares. She expects 2026 to be a challenging year for the residential sector due to several factors.
She added that the first factor is the significant rise in
property prices amid weak purchasing power. Additionally, the intense buying
activity during 2023–2025 led to an oversupply of units in the market. With
declining interest rates, this will negatively impact customers’ ability to
finance property purchases through returns on savings certificates.
El-Saadany noted that the decline in inflation rates and the
stability of the Egyptian pound make investment demand less attractive.
Consequently, she does not expect real estate demand to recover before the
second half of 2026, which could lead to a market correction, as developers may
be forced to offer only limited price increases when launching new projects.
The company also expects that by the second half of 2026,
the Central Bank of Egypt will further cut interest rates by an additional 300
basis points, on top of the 725 basis points reduced in 2025. This would
strengthen the purchasing power of property buyers in Egypt.
Based on this sector outlook, HC Securities & Investment
stated that it favors companies with investments in the hospitality sector.
This allows them to withstand any potential slowdown in residential activity
and benefit from the government’s focus on developing the tourism sector,
especially after the official opening of the Grand Egyptian Museum.
She added that Orascom Development Egypt is well-positioned
to benefit from both short- and long-term growth prospects in the country. The
increased attention in the Red Sea region, driven by the announcement of Emaar
Misr’s “Marassi Red Sea” project, bodes well for the company’s approximately 15
million square meters of undeveloped land in El Gouna.
El-Saadany believes this will positively impact Orascom
Development in the medium term, despite expected short-term competition. She
also praised the company’s impressive ability to market its units
internationally, noting that overseas sales reached around 49% in El Gouna and
33% in the O West project during the first half of 2025.
Given the government’s focus on increasing tourism revenues
and the growing demand for hotel rooms, she expects the Central Bank of Egypt
to launch further initiatives to expand hotel capacity in the country, which
will benefit Orascom Development.