Real Estate "The sector continues to resist"

The Minister of Housing, Urban Planning and Spatial Planning remains confident about the future of the sector, which continues to stay the course. As for the concerns of real estate developers, hope is in sight, as the 2010 Finance Bill will be debated in both Houses of Parliament. We will have to wait a few weeks to know more.

1. Eco plus: How is the real estate sector doing? And what are the prospects for 2010?
Taoufiq Hejira: The real estate sector has acquired immunity over the past few years, firstly thanks to the Royal Impetus given to the sector, promoting it as one of the engines of economic growth and social development, and secondly, given the still significant housing needs despite the unprecedented dynamism and performance shown in recent years. These factors alone constitute real buffers against the effects of the international crisis currently affecting almost all global economies. Nevertheless, this should not conceal the collateral effects suffered by the sector. In this regard, it is necessary to mention the slump experienced by the high-end housing sector in certain cities. For the rest of the major cities, the crisis is less felt in this sector. As for the other sectors, especially social housing, we can rather speak of stagnation, and the related indicators show this trend. In short, the real estate sector, which is a strategic sector in terms of investment, employment and social dimension, continues to resist. The 2010 Finance Bill did not grant real estate developers the requested tax benefits.

2. How do you plan to relaunch social housing?
First of all, let me remind you that the 2010 Finance Bill, as its name indicates, is in its project phase. After its adoption by the government council and the council of ministers, it will be debated in both houses of parliament before its adoption by the latter. In other words, in my opinion, given the path that this project still has to travel, it is premature to talk about the new provisions of the 2010 Finance Act.

3. What about the "140,000 DH Housing" program? 13 new agreements have just been signed between the Al Omrane Group and private developers, is this the beginning of an improvement in the sector?
Like the various changes that occur in various sectors, these take time to resonate with the stakeholders involved. As such, the 140,000 DH product introduced by the 2008 Finance Act was no exception. Indeed, after a series of meetings with private sector partners, developers and material producers, the latter gradually adhered to the implementation of this program, as evidenced by the ever-increasing number of real estate developers who have signed agreements for the construction of at least 500 housing units in urban areas and/or 100 in rural areas. Cement manufacturers and building material producers have also made a great effort to reduce prices for the construction of these homes. At the end of August 2009, 175 projects for the construction of this type of housing were launched, 85 by the Al Omrane Development Holding and the rest as part of the public-private partnership. Finally, it should be noted that at this date, 750 housing units have been completed, 27,314 are under construction and 22,329 units have been launched.

4. Where is the program for housing dedicated to the middle class?
First of all, it should be noted that in terms of housing, the current policy aims to allow different segments of the Moroccan population to access decent housing in line with their financial capacities. To this end, in order to offer a product suitable for households belonging to the middle class, the government has set itself the objective of building 50,000 economic villas by 2012. In order to fulfill its role as designer and to demonstrate the feasibility of this product, programs have been launched by Al Omrane subsidiaries in almost all regions of the Kingdom. The private sector's adherence to this program was immediate. Projects of this type of housing have thus been launched everywhere under different names such as the semi-finished villa, the economic villa, etc. Moreover, in 2009, the ministry undertook measures aimed at encouraging the creation of new generations of housing cooperatives for middle-class housing. In this regard, it is necessary to mention, among other things, the allocation to these cooperatives of a portion of the land plots developed by the Al Omrane group, and the development of specific specifications for this purpose.

5. The VSB program is stagnating. What are the reasons for this delay? Will the 2012 deadline be met?
We should rather congratulate ourselves on the results and progress achieved in the execution of the national "Cities without slums" program, the foundations of which are based on the orientations of His Majesty the King, may God assist him. Indeed, despite its complexity, its cost, but also and especially the multiplicity of actors involved in the execution of this program, the results achieved to date are satisfactory. At the end of September 2009, 37 cities were declared slum-free and 711,000 Moroccans no longer live in shacks.
Nevertheless, these results should not obscure the existence of constraints, especially in large cities such as Casablanca. We remain, however, optimistic and confident that the objectives of slum eradication will be achieved within the framework of the agreed program, thanks to the contribution of various actors, including local authorities, elected officials and the Idmaj Sakane company responsible for the implementation of the program in Casablanca. As for the Rabat-Temara agglomeration, we count enormously on the adherence of the parties concerned for the mobilization of the land necessary for the absorption of the last slums. In fact, in the VSB program, there is no secret. Given its participatory approach and its complex nature, the convergence of efforts as well as the mobilization and synergy of all the parties involved are the key to the success of this ambitious program, which has not failed to attract the interest of international bodies such as the World Bank, the Alliance of Cities, the MEDA program of the European Union, UN-Habitat, the US Agency for International Development, the European Investment Bank, the French Development Agency, the Japanese Bank for International Cooperation and the MENA Urban Forum.

Nadia Dref

Published on October 23, 2009

Posted online on October 27, 2009

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