Goldman Sachs has purchased a 5.5 percent stake of Egyptian real estate development company Palm Hills Development, with the possibility of increasing that stake to 10 percent in the future.
Goldman has purchased the share from El Mansour and El Maghraby Investment and Development Company, Palm Hills' largest shareholder, according to Palm Hills.
The company was founded in 2005 by Mansour and Maghraby and develops mainly high-end residential and resort projects in Egypt. The company currently has one of the largest land banks in the country, and has projects in the pipeline in residential, commercial and destination tourism.
Investment in North African real estate has so far tended to come from GCC petrodollars, but the area is attracting an increasing amount of foreign investor interest. Egypt is the largest Arab country by population, and recent economic liberalization measures taken by minister of investment Mahmoud Mohieddin have had the effect of dramatically increasing Foreign Direct Invesment into Egypt, exceeding $6 billion in 2006. Hospitality and residential tend to be the two most popular real estate sectors for investors, with a rapidly growing young population and an already well-established tourism sector.