To understand proptech in Egypt or the opportunities for PropTech here, it is essential to understand the culture and history of Egypt.
Dating back to the time of the pharaohs, Egypt is a culture and history rich country that would all be a desert if it wasn’t for the Nile River. With a bustling population of over 100 million in 2019, Egypt is the most populous country in North Africa and the Arab World. This transcontinental country’s population is 90% Muslim (followers of Islam) and 10% copts (oldest branches of Christianity). Cairo is the capital city and one the more flourishing cities of Egypt. It is interesting to note that Egypt has one of the longest histories of any modern country, emerging as one of the world’s first nation states in the tenth millennium BC. Today it boasts of the iconic monuments of Giza Necropolis and its Great Sphinx.
The rapidly growing population of here has put immense pressure on its natural resources, as the demand for quality housing and life exceeds its supply. Most of its arable land is found near and around the Nile river and this is where the biggest chunk of the population resides. But persisting against these limited resources, Egypt is rushing to become a leading startup and entrepreneurial hub of the world, one that fosters innovation and technological adoption.
But what makes Egypt highly influential in this region is its geography, population, history, and military strength. Along with its oil and gas exports, tourism is a major contributor to the economy of Egypt. Real Estate and its development is a pressing issue in Egypt as it is also a considerable contributor to the economy being a rich and safe asset class. It is interesting to note here that Egypt boasts of one of the largest and most diversified economy in the Middle East, and is touted to become one of the largest in the 21st century. The technology sector of Egypt is also a resilient economy driver, which makes it more lucrative for proptech in Egypt to develop.
Real estate and its impact on prop tech
AAIS reports showed that there is a current demand of more than 900,000 units annually in Egypt, with 239,600 units still needed in Greater Cairo only in FY 2018/19. Over the past few years, the economic slowdown resulted in Egypt suffering from a high inflation rate that has left most people with no choice other than turning their life savings into foreign currency or property assets. As per GlobalPropertyGuide, In January 2019, the headline inflation stood at 12.7%, up from 12% in December 2018 but sharply down from 17.1% in the same period last year, according to the Central Bank of Egypt. The economy is recovering, slowly but steadily.
To combat the severe housing gap, the government is taking new steps. The government has placed strong bets on the real estate market and mega-projects here in Egypt, and mostly half of the new investment in this sector goes to new cities and suburbs that are built from scratch, rather than towards projects around the Nile River. With major infrastructure updates as well as maintenance, and renewed interest in suffering locations, the government is trying to change the real estate in Egypt. This also means good scope for proptech in Egypt and a clean way for new technologies to enter and gain adoption. The PropTech sector of here has the chance to flourish and solve the unique problems of here with the help of intelligent technology.
Startups in Egypt
50% of Egypt’s population is under 30 and tech savvy, driving the startup ecosystem here to innovate and provide products for the world to use. The internet penetration here is at 40% but is growing exponentially. The number of mobile phone users here stands at an astonishing 103 million. Egypt’s massive e-commerce potential as well as its strategic geographic location makes it a favourable place for investment. It is interesting to see the rapidly changing tech industry of Egypt and the the region is currently experiencing strong growth in mobile and web-based industries.
But the best feature of doing business in Egypt, especially Cairo, is the readily available pool of talented developers and techies that are hungry for good work. The new technologies and new government is changing the monopolized industries and paving a path for healthy competition and new entrants across fields. This makes Egypt a strong horse in the race of the world’s fast growing entrepreneurial hubs.
The proptech in Egypt is still growing and a lot needs to be done for this sector to catch up with global standards. There is a lack of new technology and innovation and proptech here is limited to property management solutions, classified basis property sites and some projects in smart and green tech. Tools like 3D printing, Virtual Reality, blockchain, cloud computing are yet to make a mark. Still, there are some interesting startups doing god work in this space like:
Handaz is a team of highly skilled Architects, Civil Engineers and Software Developers who aim to play a profound role in shaping the new paradigm of AEC industry. There is a gap between Technology and the AEC industry. Our Goal is bridging this gap by providing products and services that boost the efficiency of AEC processes and automate the manual, error-prone tasks involved; thus increasing Productivity and Quality, while reducing Time and Cost of the overall process.
FilKhedma is a marketplace for home services in Egypt. It offers quick and easy booking process through its website or call center. The marketplace includes experienced technicians who have worked before in hotels, facility management and freelance. All technicians have to pass rigorous interviewing and background checking as well as customer service and quality training. Technicians are also supervised by experienced engineers.
AqarMap.com that is a property discovery and buy/sell portal that aims to change the way one buys property by empowering them with information like approximate price of any property as well as housing directory.
Nozol is the first real estate CRM platform here and is not only a ‘solutions to professionals working in real estate companies and brokerage firms, but it is also a great tool for consumers looking to buy or rent houses on the Internet’.
Beitko is Egypt’s first app based real estate platform that is a mobile application that offers a meeting point for consumers, developers, and brokers alike.This showcases that there is still a lot of scope for proptech in Egypt and for PropTech to develop and flourish.
The way forward for proptech in Egypt
The proptech in Egypt is still in a nascent stage but is showing signs of growing rapidly. A conducive entrepreneurial ecosystem, increased venture funding, need for innovative solutions to local problems as well as high tech adoption are all factors that point towards a high growth curve in the near future. We expect newer technologies like 3D printing and VR to enter this market and disrupt the traditional ways of real estate of here. This indicates immense opportunities for proptech in Egypt.