Cairo Festival City hopes to capitalise on Egyptian retail sector

Cairo Festival City occupies an area of three million square metres, located on the orbital road in the western coast of the city of New Cairo.

It lies 15 kilometres from Cairo International Airport, which gives it an appropriate strategic location.

The city includes a number of villas designed on a Mediterranean style, with Italian, French and Spanish mixes. It also includes a retail space for 300 stores, service hubs and more than 85 restaurants, 16 cinemas, office compound, a school, and two five-star hotels that have not yet been awarded.

2020 population of 90 million

There is no doubt that many factors attracted the Al-Futtaim Group to the Egyptian retail sector.

The main factor is the significant population growth in Egypt, which is concentrated in major cities, as the country has a population of 80 million people with predictions that this number will jump to 90 million in 2020. Up to 42% of these are under the age of twenty.

According to Al-Futtaim Group, the average income of those people is markedly increasing as forecast say that there will be a growth in the level of per capita income by 7.2% between 2007-2012, accompanied by increased luxury shopping habits, which will attract the attention of brands to invest in Egypt's retail sector.

According to the expected population growth of the city of Heliopolis and surrounding towns, Egypt managed to develop a significant retail base with 20 million customers, 25% of the population.

Certainly, the currently available retail space is not sufficient to meet the growing needs of the population, especially with the expectation of Global Retail Strategies that the volume of expenditure in the main and secondary commercial areas would reach $9bn in 2011, and $17.85bn in 2020.

Al-Futtaim expects that the work on Cairo Festival City will be completed by 2018. The company says it would start finishing operations as of the beginning of 2009. The first phase of the villas and shopping centre will be ready in 2011. When completed, the project will provide an integrated society where people can work, live and get all what they need without having to leave the city.

Cairo festival city scope

The group took one year to end the masterplan for the project. The site settlement began in 2004 with the removal of 15 million cubic metres of sand from it.

After the completion of the project, the buildings will occupy an area of two million square meters out of three million, which is the whole area of Cairo Festival City.

The retail space amounts to 180,000 square metres. It is expected to accommodate more than 300 stores, 85 restaurants and cafes. The area was divided into two areas: The Mall and the Open Festival Village, which - as its name suggests- will include open spaces for entertainment, open restaurants and shaded squares, as well as nightclubs.

In line with Dubai Festival City, which includes the Crowne Plaza and InterContinental hotels, Cairo Festival City has allocated an area for two hotels. The first one will be for tourism with 400 rooms and is located in the heart of the city, while the second will be devoted to businessmen, with 250 rooms and large halls that are fully equipped technically for holding meetings.

In terms of the internal road network, it covers an area of 330,000 square metres, in addition to a main 40-metre-wide road that links the entire project.

Al-Futtaim Group recently launched sales operations in the project. It expects that its project will be the focus of attention for many luxury brands as the population is growing by 1.7% annually, thus providing great opportunities for global retailers who see the region's markets as having enormous potential.

But in light of the global economic crisis that hit the entire world, will Cairo Festival City manage to fully sell all of its units?