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Zafarana beach resort

Discussion in 'Egypt property' started by propertyinvest, Jun 1, 2007.

  1. propertyinvest

    propertyinvest Active Member

  2. deedee1

    deedee1 New Member

    Re: Zafarana Beach Resort!!

    :) Hi PI,

    I too looked at zafarana for a while as Im eager to invest in Egypt soon before its too late!!
    Already since Last year alone apparently prices have already doubled and theres still capital growth expected for the next year or so!

    In the end I was unsure of its location so didnt persue it further!
    Also the project requires 100% payment upfront- but is held in escrow and released at stages throughout the construction period!

    With regards to rental guarentees unfortunately you never get anything for free Im afraid!
    Rental guarentees are a sales and marketing stunt offered by developers through agents in order to help sell their properties quickly and make them look more attractive to buyers!!

    RENTAL GUARENTEES- These are already included in the price the property that you are paying for in the first place as they add them into the sales price- so if fact you are paying the rental return guarentee yourself -not them!!!
    Developments and properties without rental guarentee tend to be cheaper to buy because of this!

    See ya D :)
     
  3. dave99

    dave99 New Member

    Have to agree about the poor location, and built in cost for the rental income - payment up front is serious bad news.
     
  4. jenniann

    jenniann New Member

    Hi Dave99,

    Out of interest, is your comment regarding location based on experience? I agree that it is away from the existing "hot spots" but is this necessarily a bad thing? There are plenty of popular resort regions away from Hughada which would have been considered "poor locations" a few years ago. There is also a great deal of investment planned for the Ain Sokhna region over the comming years - suggests that someone thinks the area has potential and I gather the Stella Di Mare resort is doing very well. I'm not saying your comments are right or wrong, just curious.
     
  5. dave99

    dave99 New Member

    This particular location is effectively being sold on the back of the "planned" new airport in the region and if and when this happens, and there are direct flights from the UK, it should turn into a real winner, but why wait and gamble for the next 5 to 10 years when Hurghada is there now.
    Red Sea Developments (UK & Egypt) - 2 Bed Apartments from £14950
     
  6. jenniann

    jenniann New Member

    Hi Dave,

    I agree, the airport will certainly be a bonus if it goes ahead but since it is so close to Cairo I'm not sure it matters that much. Granted, there are quite a few developments in the area which are plugging the new airport as one of their main selling points at the expense of other, more positive and certain features, which could prove to be a mistake if it doesn't go ahead.

    Personally, I don't think Zafarana is one of them and the developer appears quite up front about what it does and doesn't offer. I have had quite a bit of contact with the developer whilst researching a number of other projects and he seems to have his head screwed on. Hurghada is not really an option for us because with our budget, we would be looking at a studio apartment, sharing a single pool in the middle of a high-rise with a couple of hundred people, or sharing the public beach with every man and his dog. Granted, Zafarana is a bit of a punt and could be a flop, but you get a beachfront pad in a 3-storie building for a fraction of the price further south.

    At the end of the day it's horses for courses. If investors want a slightly more certain location then Hurghada may be the way to go but prices and value for money will reflect this. I'm not advocating Zafarana or the Ain Sokhna region in particular, I'm just saying don't rule out alternative locations simply beacuse they are not Hurghada.
     
  7. Peter Mitry

    Peter Mitry <B>Egypt Forum Founder Member</B>

    Hi Jenniann do you have any contact details for the Developer in Ain Sokhner? I had heard that in the area where Zafarana is located there are a lot of gas installations and there can be a nasty whiff if the wind is in the wrong direction! Can anyone else confirm this?
     
  8. dave99

    dave99 New Member

    I think you're correct about the pricing versa facilities versa location. For my benefit and all other interested parties are you willing to share your knowledge on apartment prices.
    The basic price for, say a 2 bed apartment about 80sqm of usable space, on a small complex (mine), with pool is currently around £30,000, in other bigger resorts in Hurghada with more hotel like facilities the same would be about £40,000, in Sahl Hasheesh maybe more like £80,000.

    So what are you paying.

    Red Sea Developments (UK & Egypt) - 2 Bed Apartments from £14950
     
  9. jenniann

    jenniann New Member

    Hi Dave,

    No problem. We actually went for a 1 bed at 55sqm and paid £18,000 but for a fair comparison, a similar sized apartment (80sqm) with similar facilities to Sahl, you would be looking at about £28,000. Not to confuse or upset anyone, I am not comparing the resort to Sahl as presently the development is not on the same scale, but it does offer a private beach-front, hotel facilities, low-rise buildings, tennis / squash courts, dive school etc - essentially what you would probably expect of a 5* resort complex. If you go closer to Ain Sokhna itself prices increase slightly but it depends on the resort. Zafarana is about 30 miles away but the new marina which is probably more appealing than Ain Sokhna, is half way in between so only 15 miles away. Personally, I think the region does have good potential but it's easy to get excited about cheap prices and forget the fact that there is a reason - investors do need to go in with their eyes open.

    Peter,

    No, I'm afraid I don't. I'm not sure how many are at the marketing stage yet, there have been quite a few articles in some of the Egyptian newspapers about development in the area giving names of some of the resorts but other than Zafarana the only main one I came across was "Aquarious Resort" which is described as Irish owned but no details of who the developer is - it is being marketed primarily by Red Sea Investors. The developer for Zafarana is IPI who are Dutch. With regard to gas installations, I haven't been out that way myself but know of quite a few people who have and you are the first to mention it so I'd be interested to know other people's experiences.

    Hope this helps!
     
  10. dave99

    dave99 New Member

    Restrictions on use seem harsh

    Hi
    Just been looking at this resort and have to say on initial viewing it looks too good to be true, but then on further investigation its very restrictive.
    You are limited to 6 weeks own use, no air conditioning, full payment upfront, about £40 transfer fee from Cairo airport (180km away), contract for rental must be for 5 years, mandatory furniture packs if renting, extremely optimistic rental yield of 14% in year 5 (if you last that long). The baisc price is very low but are you really buying anything.

    And they are pushing the fact in the ads that there is planned new airport which may or may not get UK flights in the next 10 years, but even then it still going to be a lot further away than Sharm or Hurghada resort complexes.
     
  11. jenniann

    jenniann New Member

    Hi Dave,

    All fair comments to which I would respond below. However, I just want to make it clear that the purpose of my commenting on this thread is not to plug the resort - I'm sick of seeing posts which effectively amount to advertising, or agents for one resort slagging off another. My only intention was the debate the possibility that areas away from Hurgada and Sharm have something to offer in their own right. This is a competitive market but nothing is ever "a great deal" or "too good to be true" unless you don't do your research and don't fully understand what you are buying.

    Personal use: You are correct, there are restrictions on usage but I thought that was the norm with any development offering guaranteed rentals - otherwise how would they rent it out to cover their costs? I certainly looked at quite a few which were restricted to 4 weeks and only allowed private use at specific times of year. I must admit that we didn't look that closely at the package offered on the 2 beds as the numbers worked out better on the 1 bed apartments but I don't think it is compulsory to take the rental guarantee. With the 1 bed's you can have as much private use as you like, you just take a share of the pooled rental income in proportion to the time your apartment is available. The 1 bed's also have air-con included.

    Furniture package: Again, is this not common? Surely the management company want to be able to guarantee a uniform style and standard if they are taking responsibility for letting. Apart from anything else I really don't fancy the prospect of hunting for my own furniture out there or buying it here and shipping it out - I'm quite happy to buy the package and the 1 bed package was reasonably priced.

    Rental returns: Yes, a bit hit and miss but there are 2 factors at play and the lower the initial investment the easier this will be to achieve. Obviously the other factor depends on the popularity of the resort and that is the unknown quantity - to get a net return of 14% ours (i.e. after mgmt charges) we would need 80% occupancy. We will just have to wait and see.

    £40 transfer fee: This is the charge to vista for an inspection trip, there will be a proper shuttle service once the resort is open.

    Payment upfront: No, not ideal but it seems to be closely monitored both by the Escrow agent and a UK lawyer. Again, this needs to be factored into the risk and the cost of your total investment (i.e. 12 months lost interest). On the
    plus side it means the developer is less likely to run out of funds half way through.

    The Airport: Yes, they are using it as a marketing point but IPI make it clear that it is planned. Granted, some agents are putting their own twist on things and this is not always clear. However, any investor with half a brain cell should have done some minimal research and found out the facts, if they haven't then they are either far too trusting or have more money than sense. We came to the conclusion the project was still perfectly viable even without the airport. There are plenty of popular holiday destinations more than 180km from the nearest airport.

    I'm afraid I have rambled on longer than I intended so apologies. Zafarana is one of many investment opportunities in Egypt at the moment, all of which have their merits depending on your investment profile. I do have a vested interest because I have invested but I'm not trying to sell anyone on the resort, there are more than enough agents out there to do that. When I buy shares I don't make it my mission to bore anyone who will listen on the merits of the company but neither do I set out to slag off the competition.

    I hope this has clarified a few points without sounding too 'agenty' - I'm really not, buy what suits you!
     
  12. Peter Mitry

    Peter Mitry <B>Egypt Forum Founder Member</B>

    Thank you Jenniann! At last a bit of common sense from a pure Investor and not an agent with vested interests.
    Although I am a long term investor I too am an agent and have used this forum in the early stages to promote my projects but we now have a commercial area for these posts and it is time that the Forum began reflecting issues which are of concern and interest to all contributors. The multiple recent posts from certain agents and Developers have a distinctly once sided slant and it is a breath of fresh air that you have seen through this.
    Come on guys, lets quit sniping at each other or the relative merits of one project against another - the true Investors will decide that for themselves.
    The Forum is for sharing of information about Egypt and the relative merits of investing here, not solely the often biased views of individuals involved in the business.
     
  13. Nick Wilcox

    Nick Wilcox New Member

    Hi Everyone,

    I have just found this forum and i personally bought just over 2 months ago after a site inspection. I spent a week over there and looked at a number of areas including Hugarda.

    I have just read the comments by Peter Mitry and i am perplexed by the fact that you make a point about some one not being an agent and you then go on to admit that you are, you therefore have a vested interest with regards to the forum. You then go on to talk about not sniping about other projects but that is exactly what you are doing. Further more when people are looking to invest there hard earned money into something that will have real consequences on there financial status i think it is quite deceitful to make comments with no factual information thereby promoting your own project. I think these sites should be for potential investors and buyers to discuss projects so they can sum up the pro's + con's of a development and find something that really fits there requirements.

    Comments regarding the smell of gas are just ridiculous, we travelled around the area and i can tell you that there isn't a refinary within a 50 Km radius.

    Also we traveled down to Hugarda and i really wasn't impressed. My feeling is that the area has already seen growth and therefore the potential growth in Zafaran is much higher.

    As jenniann pointed out i think the 100% finance upfront can be a positive, it means the developer won't go bust, it also means they can build everything at a much lower cost, as they don't have to take out bank loans etc, etc.. which is one of the reasons why the price's are so low.

    As with jenniann i'm sorry to rant on, however i think its important that people are not given falsue information!!!

    I think Zafarana is a great investment and me and my wife are actually thinking about buying another if we can get the cash!!!

    Regards,
    Nick.
     
  14. john4160

    john4160 New Member

    Hi all,
    I too am investing in this development. Pesonally I do not think that the deals offered are that bad or dodgy in any way. For me 6 weeks use is plenty. As for the rental guarantee, when this resort takes off (which I believe it will) the developers are going to make a packet, that is why they can offer the deal that the are. Even without the guarentee rental, this should see a good return on your investment. As for the airport, I agree that even if it is not built this should still take off. There are plenty of holiday "hot spots" around the world that have long transfer times, and these do not seem to suffer. Also the way the budget airlines are going I dont think it will be long until seriously cheap flights will be available to Egypt, you have to remember that the airlines will go where the people want to go.
    It looks to me that some of these posts are by agents who are not in on this one , and are trying to put people off. Maybe with the hope that they will turn to one of there developments.
     
  15. andyk2

    andyk2 New Member

    Almost right

    I appreciate your points (and those made previously) about your investment. It is true that Peter and myself are agents working to promote our self-interests in Sahl Hashessh (and would BP say "don´t buy our petrol- Shell is cheaper"?). If you have seen my post about airlines already travelling to Egypt, you would not be alarmed in respect of "foreign" tourists travelling to Egypt (it was entitled something along the lines of "How we lost the Empire"), but the point still remains about yout exit strategy. There are plenty of "cheap" alternatives to investing in Egypt. Look around this forum, look at what a hundred or more "international" agents are offering in Egypt. Where is your end-user market coming from?

    For £20.000 you can have an apartment in Egypt. For £50.000 you can have an apartment in Sahl Hasheesh - it´s like Marbella V Benidorm. At the end of the day, what do you want - and, more importantly, what does your end-user want?
     
  16. Peter Mitry

    Peter Mitry <B>Egypt Forum Founder Member</B>

    Thanks Jenniann; lets see if anyone else has visited Zafarana and can comment on the closeness of the gas installations and any likelihood of air contamination. My only other worry, having seen the plans is that it appears to be a heavy build density with a lot of properties fairly close together. What was your impression? 28k GBP is a good price but you can still get a 64m2 one bed unit in Sahl in Palm Beach Piazza for 50k GBP which is ready now; also you only have to pay 40% and you get your keys; the balance is payable over 9 months. This is abolutely front line beach.
     
  17. BIG B

    BIG B New Member

    Hi,

    Like John & Nick, I too have just invested in the resort, I compared the package offered to the package offered on our off plan investment in Bulgaria, & Zafarana won on almost every aspect. I dont mind paying up front as in some ways we can relax and forget about it until its complete, our bulgarian one is staged payments and unless you go out to visit you dont know what stage its at or when next payments are due. Our developer in Bulgaria is already 4 months behind schedule.

    To me the investment should be about making money - in the medium/long term - and these apartments with 5 years guarenteed rental and six weeks personal use which if you dont want to use you can also rent out, the rental will end up as 50% of the purchase price, (6,8,10,12,14%).

    The transfer from the airport - 180Kms - should be treated as part of your holiday allowing you to see some of egypts scenery. So in my opinion if the planned airport does not quite work out its certainly not the end of the world.

    I may be naive but Zafarana seems a good investment, with excellent returns I hope to see some of you out there on completion

    Cheers
    BIG B
     
  18. Rit

    Rit New Member

    Furniture package

    Hi there, I have recently bought a 2 bed middle apartment in block H opposite the pool. Its my 1st overseas purchase.

    I know what is included in the furniture pack but does anyone have any idea of the type of furniture. My agent emailed me pictures of a couple of samples but wanted to know if anyone who has been out to see the Zafarana development spoke to anyone regarding the furnishings etc.

    thanks

    Rit
     
  19. portiz372

    portiz372 New Member

    I have bought a 2 bedroom apartment in G block and believe this is a really good investment opportunity. Everything is done for you by the developer/management company, unlike the other apartment I have bought in Dubai.
    I have never yet been to Egypt and I have heard that in Egypt, the locals hassle you to death, especially if you are a woman, but I have also heard that it is really child friendly???
    Also, I think people have concerns about terrorism in Egypt after previous attacks, but the fact that this is a self contained resort with security and everything there, makes it really appealing. It even has it's own private beach and coral reef, and really, there is no need to go off the complex, apart from the obvious of visiting the sites.
    I have not seen a resort like it in any of the other more established and popular resorts in Eygypt. If anyone else has, then I stand corrected. This resort just stood out to me.
     
  20. Bluenitsuj

    Bluenitsuj New Member

    Despite the few negative comments and personal views from various people within this site, I think this developement looks a great investment, a few people on this site are only interested in there own interests and will obviously always be cynical about other peoples preferences. I myseld am going to invest in this resort and welcome any more feedback from only those people who have already invested, I would like to know which agent/company you used and how well the after sale service is working for you.
     
    Last edited: Sep 16, 2007
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