Invest-Gate’s Roundtable “Proptech Innovations: Shaping the Future of Real Estate” Hosts Egypt’s Property Pioneers to Lead Digital Transformation in Real Estate, ACUD Chairman Announces Launch of First Real Estate Startup Incubator
Invest-Gate has kicked off its third roundtable “Proptech Innovations: Shaping the Future of Real Estate” in 2024 on Monday, September 9th at the Nile Ritz-Carlton.
This unique occasion witnessed the attendance of Eng. Khaled Abbas, Chairman and Managing Director of Administrative Capital for Urban Development (ACUD) who used the opportunity to announce the launch of Egypt’s first real estate startup incubator, a symbolic gesture that emphasizes Invest-Gate’s leading role as a pioneering platform for innovation in the real estate sector.
During the event, Abbas inaugurated and toured Invest-Gate’s first-ever proptech Startups Pavilion, which provided an exclusive platform for up-and-coming entrepreneurs to share their ideas, innovations, and visions for the future of proptech. This new and exciting pavilion was designed to be a conducive environment for business networking, showcasing the latest technologies and solutions that Egyptian proptech startups have to offer.
The roundtable was also marked by an elaborate awards ceremony in which Invest-Gate took the opportunity to recognize and honor the industry’s officials and leaders for their merits and remarkable contributions to the industry, which included Eng. Khaled Abbas himself for his successful and highly effective leadership as the ACUD’s Chairman and Managing Director.
Taking a deep dive into the world of digitalization and the endless possibilities of cutting-edge technological solutions, this engaging discussion sought to explore the unlimited potential that proptech can offer Egypt’s growing and swiftly developing real estate market as it seeks to become more globally competitive.
Divided into two separate sessions, the entire roundtable was moderated by Mr. Amr Elkady, Founder & Managing Director of AKD Advisory and Board Member of Egypt’s Real Estate Export Council, and witnessed the presence of an elite group of senior officials, business executives, and experts.
Both sessions involved interactive polls which the audience actively participated in and each session gave the floor the attendees to ask questions to speakers on the panel. The first session addressed three different topics including understanding proptech, boosting ROI with proptech, and the development of smart cities.
Starting the discussion, ACUD Chairman and Managing Director Eng. Khaled Abbas stressed that the use of technology in the Egyptian real estate sector is no longer a luxury. Instead, it has become a necessity and a tool for enhancing performance and decision-making.
Further elaborating on this point, he emphasized the importance of using technology wisely in order to create an extensive real estate database that provides critical data and insights that are necessary for comprehending real estate dynamics, value drivers, and utilization variables. He emphasized how this information helps clients, developers, and foreign investors make decisions more quickly.
Abbas emphasized that the New Administrative Capital is the epitome of smart technology infrastructure that enables the integration of technology in all aspects of the city, boosting its competitiveness compared to other markets.
He outlined plans to use cutting-edge technologies that support the development of smart cities that provide an improved quality of life via integrated technology solutions. He underlined that proptech is a key component in the NAC’s transformation into a smart city and is a key pillar for accomplishing sustainability objectives and satisfying the expectations of a progressive society.
Furthermore, Abbas stated that the Ministry of Justice and ACUD are working together to initiate the national real estate ID project, pointing out that each real estate asset in the New Administrative Capital (NAC) is given a unique code. He made the point that the NAC’s overall growth strategy, which includes the NAC’s transportation infrastructure, is largely shaped by the registration of real estate properties inside it.
Moreover, Eng. Bedeir Rizk, CEO of Paragon Developments, said that proptech provides the real estate industry with solutions to reduce the cost of materials and boost sustainability. Proptech also enhances sales operations, enables online registration of property ownership through online portals, and improves the management of facilities, Rizk added.
He also highlighted the importance of enhancing the user experience with regards to proptech as an essential pillar to guarantee its successful growth in Egypt.
Eng. Abdallah Sallam, President and CEO of Madinet Masr, highlighted that the subject of the roundtable – proptech – is new and worthy of attention, as this technology has become crucial for the facilitation of operations in general. He emphasized that a distinction should be made between proptech and contech.
Sallam elaborated that the integration of proptech has evolved into a tangible reality amidst technological advancements. This technology can effectively eliminate barriers and expedite task completion. Proptech encompasses various stages of the real estate sales process, commencing from sales initiation and customer familiarization. It can facilitate customer acquaintance with real estate offerings, master planning, and outreach to international clientele. Moreover, it extends its utility to post-sales services and facility management.
For his part, Eng. Ahmed Mansour, CEO of Cred, stated that technology has accelerated the production pace of [building] materials in the Middle East and Africa.
Mansour elucidated that the company leverages artificial intelligence across various sectors, such as market research and analysis. He highlighted the challenge posed by the insufficient data on units within the Egyptian real estate market. Comparatively, data accuracy abroad aligns closely with reality at a rate of 90-95%, whereas in Egypt, this figure hovers around 50-60%. He emphasized the company’s ongoing efforts to enhance its operations, including the development of an application integrating augmented reality. This application facilitates communication with sales representatives and streamlines all transactions through its interface.
Mr. Ahmed Abdallah, Vice Chairman of REDCON Properties, stated that the Egyptian real estate sector accounts for 20% of the national GDP and 14% of the labor market, stressing the need to search for quick solutions to maximize investments within Egypt, especially in light of the current situation in which Egypt suffers from problems, such as inflation and the high cost of financing, one of these solutions is the use of technology in real estate.
The Vice Chairman of REDCON Properties said that it is necessary to employ technology in the market and benefit from virtual reality (VR) features, which is one of the real estate technology tools that allows workers to explore properties in detail through three-dimensional virtual mobile phones. It provides an experience similar to physically visiting the property. Abdallah said the developer must have this technology as it can be used remotely, making it easier for the customer to make a purchasing decision.
Abdallah emphasized the necessity to develop an integrated marketing plan that contributes to attracting more investments in proptech, highlighting the announcement of ACUD Chairman Managing Director Eng Khaled Abbas regarding the initiative to promote investments proptech and emphasizing that the company would be the main sponsor of this initiative. In this regard, Abdallah announced that REDCON would join this initiative, whether by establishing a specialized committee to explore projects and unique ideas in the field of proptech, in addition to supporting them by establishing business incubators sponsored by developers.
He added that Egypt has many opportunities with its large market that requires more services and projects, emphasizing that the available investment opportunities are diverse and that the country enjoys the necessary political security, stability, and support to attract investments. He noted that the size of the global proptech market will reach $90 billion globally within the next few years.
In addition, Mr. Karim Zein, CEO of Coldwell Banker, said that real estate brokers’ mission is to communicate with clients to provide him/her with the best service at the right time.
He argued that companies pay a lot of money for social media marketing, but they do not get their money’s worth. Zein showcased his company’s success in the development of a database through understanding customers. He also emphasized the company’s use of metaverse technology to showcase units to clients, especially abroad.
On this occasion, Dr. Karim Shaalan, CEO of Royal Developments, said that Egypt is new to real estate technology compared to other countries, but with the rapid progress of technological development, Egypt has begun to take serious steps to expand the use of technology in real estate.
In his statement during the conference, he pointed out that North America accounts for approximately 45% of global proptech followed by Europe at 30%; the remaining percentage is distributed among the rest of the world.
He indicated that the use of proptech in the Middle East is generally limited, except for the United Arab Emirates, which accounts for about 50% of proptech applications in the Middle East.
He added that proptech has a positive impact on the real estate sector in Egypt, especially real estate investments, as it aids developers in making informed decisions, from designing the property to collecting data and information. He pointed out that foreign countries are designing small portfolios to invest in real estate units while having all the necessary data about the unit.
He stressed the need to collect data so that there is an accurate database that helps customers easily find properties while being able to access all the essential details.
Shaalan called on real estate companies to adopt the ideas of real estate startups within the framework of development and marketing, as well as build awareness among companies and customers regarding the importance of technology.
Concerning his company’s foray into the Egyptian market, Mr. Alaa Elsayed, CEO & Founder of Voom, noted that the experience in the foreign real estate market surpassed that in Egypt. He observed that the global real estate market adapts to technology more swiftly and offers easier access to decision-makers abroad compared to Egypt.
Regarding the integration of technology within real estate development firms, Elsayed elaborated that over the past two decades, Customer Relationship Management (CRM) technology has been adopted. However, the utilization of technology to engage with customers has remained limited, despite the substantial scale of projects. There exists a greater receptivity to technology overseas, as traditional sales methods persist within the industry.
Eng. Ahmed Kadri, CEO of SAK Developments, urged the fast adoption of blockchain technology in the real estate sector, which is a promising sector in Egypt.
He emphasized that Egypt is a new market for real estate technology, as there are less than 40 real estate technology companies in Egypt, even though the real estate market represents about 20% of the gross domestic product. He stressed on Egypt’s need to apply blockchain technology to enhance the flexibility and ease of real estate sales and he called on the government to regulate units by registering every property within Egypt using QR codes.
In conclusion, Eng. Mohamed Eslam, Managing Director of Ebny Developments, called for the development of an integrated real estate system between the public and private sectors.
Eslam expressed jealousy of the development of proptech abroad, especially that Egyptians had contributed to that. He stated that Ebny Developments provided a model for technological development in Sohag in Upper Egypt in collaboration with Vodafone.
The second session of the roundtable was also excellently moderated by Mr. Amr Elkady, Founder & Managing Director of AKD Advisory and Board Member of Egypt’s Real Estate Export Council, and offered an insightful discussion on finance & investment, laws, and regulatory frameworks, in addition to creating a startup-friendly climate for Egyptian proptech.
Eng. Bedeir Rizk, CEO of Paragon Developments, emphasized the importance of cooperation between Egyptian and international companies in the field of proptech.
He noted that among the biggest challenges facing the proptech sector is the building of capabilities, and hence the sector needs long-term support. He also highlighted a collaborative initiative involving ABEC in providing an incubator environment for emerging companies in proptech.
For his part, Eng. Abdallah Sallam, President and CEO of Madinet Masr, stated that the Invest-Gate roundtable discussion on proptech is timely and effective.
He emphasized that the coding of real estate properties and the integration of property technology are essential, given the rapid pace of the real estate market in Egypt and the increasing Arab and foreign demand for property purchases.
In addition, Mr. Ahmed El Alfi, Founder & Chairman of Sawari Ventures, said that over two to three years to come, companies will have the tendency to merge, which will boost the efficiency of the real estate market.
El Alfi also outlined the importance of initiatives such as the Greek Campus and other efforts to stimulate the startup climate in Egypt.
Eng. Ramy Moustafa, Vice President of Buildings and Transactional Business at Schneider Electric Northeast Africa and Levant, highlighted the significant increase in the use of technology and artificial intelligence in the real estate and contracting sectors.
He emphasized that this trend brings a range of benefits and advantages, contributing to the growth and efficiency of these industries.
Mr. Walid Hassouna, Founder & CEO of valU, stated that the Egyptian real estate sector is very strong, supported by the increasing promotion of the North Coast area.
Hassouna shared his company’s experience in providing mortgage-related services, including financing of maintenance deposits and finishings. He noted that Egyptian clients have low credit risks.
Discussing the future of proptech in Egypt, Eng. Mohammed Azmy Ateia, Director-Smart Cities at Orange Egypt, stated that the Egyptian real estate sector is flourishing, proven by the expansion of Egyptian expertise abroad. The telecommunications and ICT industry has maintained high competitiveness for over 25 years, while financial technology shows great promise with the Central Bank and financial institutions’ focused attention. The convergence of these sectors indicates a burgeoning potential for real estate technology advancement . Understanding these intersections necessitates the cultivation of fresh expertise in the field.
Ms. Zeina Mandour, Venture Investments Manager at Dar Ventures, highlighted that Dar Al-Handasa is developing the construction sector, adopting modern technology that facilitates operations in various industries, including real estate.
Mandour elucidated that the inception of Dar Ventures was a result of Dar Al-Handasah’s strategy to invest in start-ups within the venture capital sector. This initiative aimed to catalyze market interest in this domain, given the scarcity of companies operating in this sector. The presence of established firms that comprehend this industry is vital to fostering its expansion. She underscored the significance of forging partnerships with other entities or funds, both domestically and internationally, to mitigate investment risks and streamline marketing efforts.
In addition, Mr. Abdel-Azim Osman, Co-Founder & CMO of Nawy, stressed the need for creating innovative solutions to help enable investment in the proptech sector, as the Egyptian market is promising.
He also highlighted that people have confidence that Google and Meta companies collect accurate data about them, which is factual evidence of the importance of technology. Similarly, Nawy is collecting information from the real estate sector in a way that benefits both clients and developers.
Regarding the utilization of technology in facility management, Mr. Mostafa El-Nahawy, Co-Founder and CEO of BirdNest, highlighted that 40% of real estate acquisitions serve investment purposes. However, these properties necessitate operational funding, with traditional renting yielding returns below 5%. To address this, offering hotel units with a higher return of approximately 50% emerged as a solution. Yet, property owners often lack the time to oversee the rental process. BirdNest streamlines this procedure by deploying proprietary property management software, simplifying property preparation, and securing essential financing to render them rental-ready. Subsequently, properties are listed on BirdNest’s online platform and offline through real estate agents, leveraging technology to establish transparency among property owners, tenants, and operators.
The sponsors of this roundtable included Paragon Developments (Official Sponsor), Madinet Masr (Platinum Sponsor), Cred (Platinum Sponsor), Royal Developments (Gold Sponsor), BirdNest (Delegates Bags Sponsor), Voom (Registration Desk Sponsor), Ebny Developments (Silver Sponsor), SAK Developments (Silver Sponsor), Proptex (Silver Sponsor), and Schneider Electric (Silver Sponsor).