Egypt development deal blocked by court

An Egyptian judicial panel ruled on Tuesday that a state land sale to Palm Hills Development, Egypt's second biggest listed developer, was illegal and should be scrapped.

Palm Hills Development was the second company to face such a ruling, after a court ruled Talaat Moustafa Group's $3 billion Madinaty contract be scrapped, in a case that underscored the risks of investing in Egyptian real estate.

"The contract signed between the New Urban Communities Authority (NUCA) and Palm Hills violated the auctions law because it was signed by direct order," the body said.

Hamdy Fakhrany, who filed the case against TMG, also filed the Palm Hills suit, contesting a 960,000 sq m plot of land in a Cairo suburb, saying it was sold by NUCA, a housing ministry body, at below the market price.

The Palm Hills case is now being heard in courts and the judicial panel on Tuesday advised the contract be scrapped because it was sold in violation of the law and below market prices, a statement said.

Source: Trade Arabia