Buying or leasing industrial land in Egypt: government land, free zone, investment zone or existing factory?

1. Land in Egypt: investment, production base and foreign-currency instrument

Industrial land in Egypt is attractive for three reasons.

First, demand for well-serviced industrial plots is rising. Companies want electricity, water, wastewater, road access, proximity to ports, labour and suppliers. The more these factors come together, the more valuable the land becomes.

Second, Egypt is strategically positioned: Europe, Africa, the Gulf and Asia are accessible via sea, road and rail corridors. Locations near the Suez Canal Economic Zone, Ain Sokhna, East Port Said, 10th of Ramadan, Badr, 6th of October, Sadat and Borg El Arab benefit from this logic.

Third, land is increasingly treated as an industrial asset. Companies that buy land and build a modern factory are not only creating production space; they are often building a long-term asset. However, appreciation is not automatic. It depends on location, infrastructure, permitted activity, utilities, use obligations, resale rules and actual demand.

At GEMP Consulting, we therefore look beyond the square-metre price. We ask: Does the plot fit the production process? Is the activity allowed? Is there enough power? How realistic is the building permit timeline? Can the site be expanded? And is free zone status really better than normal industrial land?

2. Four routes to production in Egypt

Industrial investors usually have four main options:

• Government / IDA Industrial Land: purchase or allocation of industrial land in official industrial zones.
• Investment Zone or Industrial Developer Zone: land or industrial units in areas run by a developer or central investment-zone structure.
• Public or Private Free Zone: long-term use of land or buildings in a special customs and tax regime.
• Existing Factory or Ready-Made Industrial Unit: purchase, lease or use of an existing industrial building, often faster but not always cheaper.

The right route depends on whether the company mainly exports, sells locally, imports inputs, needs speed or wants to build a long-term asset.

3. Government industrial land: own land in classic industrial zones

The classic route is to acquire or obtain allocation of an industrial plot through the relevant authorities, especially the Industrial Development Authority (IDA) and the digital industrial platform. IDA describes the platform as a central system where investors can view available plots by city, plot number, coordinates, zone, permitted activity, area, utility status, square-metre price and allocation mechanism.  

Typical industrial areas include:

• 10th of Ramadan City – strong in electronics, home appliances, packaging, metal, automotive suppliers and general manufacturing.
• 6th of October City – a key industrial area west of Cairo, strong in food, machinery, packaging, pharma, plastics and consumer goods.
• Badr City – relevant for East Cairo, the New Administrative Capital corridor and labour availability.
• Sadat City – large-scale industrial development between Cairo and Alexandria.
• Borg El Arab – close to Alexandria and Mediterranean logistics.
• Beni Suef, Sohag, Qena, Assiut and Aswan – increasingly important for Upper Egypt, labour and regional development incentives.
• Sokhna, East Port Said, Qantara West and East Ismailia – part of the Suez Canal Economic Zone with strong export and port logic. SCZONE officially lists these four as its industrial zones.  

IDA’s own success stories include international manufacturing examples such as Samsung in Beni Suef, Vivo in 10th of Ramadan and LG in 10th of Ramadan. This shows that foreign industrial investment in classic Egyptian industrial zones is already established.  

The typical process — deliberately simplified

The process usually looks like this:

1. Project definition: sector, product, capacity, export share, local sales, energy demand, water, wastewater, hazardous materials, storage, expansion.
2. Company setup: incorporation or use of an Egyptian project company.
3. Location screening: comparison of zones based on labour, ports, customers, suppliers, infrastructure and land price.
4. Plot selection via platform: plots are shown electronically and the conditions booklet can be downloaded.  
5. Document submission: commercial register, articles of association, tax card, ID/passport or POA, 10% reservation amount, bank statement covering 50% of land value and a project profile.  
6. Committee review: the authority reviews the project, activity, financial capability and suitability.
7. Allocation and payment: after approval, further payments are due; the relevant authority then hands over the plot.  
8. Building planning and permits: construction application, technical drawings, civil defence, environment, occupational safety and utility connections.
9. Factory construction: foundations, steel structure, roof/walls, floor slab, fire protection, electrical systems, utilities, offices and social areas.
10. Operating licence and industrial register: only then is the industrial activity properly formalised. IDA describes industrial establishment as a multi-stage process involving activity selection, location, feasibility, construction, licensing and operation.  

The details vary significantly by zone, activity, authority, environmental category and ownership model. This is a core part of our work at GEMP Consulting: structuring the process so that location, approvals, technical planning and investment logic all fit together.

4. Investment Zones and Industrial Developers: fewer interfaces, often faster start

Beyond classic government land, investors can use Investment Zones or land developed by Industrial Developers. GAFI describes an Investment Zone as an area where the developer provides infrastructure and services and investors can use land or industrial units with full utilities. The zone is administered by GAFI, and approvals, building permits and operating licences are handled through a more central structure.  

GAFI states that Investment Zones may have a board and executive office coordinating project approvals, building permits, activity licences, civil protection, occupational safety and environmental matters.   GAFI also lists success stories in 6th of October, 10th of Ramadan and Damietta.  

Industrial Developers work in a similar direction. IDA describes the model as a partnership with private developers who provide serviced industrial land, build infrastructure and organise services such as roads, water, wastewater, power, gas, telecommunications, logistics, security and maintenance. The aim is to provide ready-to-use industrial land and attract foreign direct investment.  

For many mid-sized companies, this is attractive if they want a faster start and fewer infrastructure issues. The downside is that land is often more expensive than raw government industrial land, and the company is more dependent on the developer’s rules, fees and availability.

5. Public Free Zone: strong export model, but not for everyone

A Public Free Zone is a special customs and tax area. GAFI describes Free Zones as an investment system under Investment Law No. 72/2017 supervised by GAFI.   Companies in Free Zones benefit, among other things, from customs and VAT exemptions on capital assets and production requirements for the project activity; imports and exports are not subject to the normal national customs and tax rules.  

GAFI distinguishes between Public Free Zones and Private Free Zones. Public Free Zones include Alexandria/Al Amerya, Cairo/Nasr City, Port Said, Suez, Ismailia, Damietta, Shebin El-Kom, Media Production City and Qeft.  

According to GAFI’s Public Free Zone brochure, annual land-use fees are:

• USD 5 per m² per year for industrial activities.
• USD 10 per m² per year for service and storage activities.  

This is attractive if a company is strongly export-oriented and imports many inputs. But Free Zone status is not a universal solution.

When Free Zone status makes sense

Free Zone status can be suitable when:

• the export share is very high,
• imported inputs are processed and re-exported,
• customs and VAT exemptions create real value,
• the company is large enough to handle compliance,
• local sales in Egypt are limited,
• and the goods flow is clearly documentable.

When Free Zone status may not fit

For smaller companies, it can be highly advantageous not to operate in a Free Zone. If a company wants to sell locally, act flexibly in the Egyptian domestic market or has limited customs savings, normal industrial land may be economically simpler.

Free Zone status also means: customs boundary, documentation, GAFI fees, export logic, separate procedures for sales into the Egyptian market and a higher compliance burden. For a smaller manufacturer with 20 to 80 employees selling mainly locally or regionally, own industrial land in 10th of Ramadan, Badr, Sadat or 6th of October is often the better base.

At GEMP Consulting, we therefore do not automatically recommend a Free Zone. We first analyse where the customs benefit really arises, how high the export share is, how much imported material is in the product and how expensive the additional complexity becomes.

6. Private Free Zone: powerful tool for large export projects

A Private Free Zone is not a normal rental site. It is a project-specific status for a defined plot or facility. GAFI describes Private Free Zones as locations for a single project or similar projects when the business logic requires a specific site outside a Public Free Zone. The site may be owned or leased by the investor.  

However, the thresholds are high. According to GAFI’s Private Free Zone brochure, the criteria include:

• company form usually Joint Stock Company or Limited Liability Company,
• issued capital of at least USD 10 million,
• investment cost of at least USD 20 million,
• for industrial projects, generally at least 500 permanent employees,
• area generally at least 20,000 m²,
• local component ratio of at least 30%,
• export rate of at least 80%.  

The process is also multi-stage: application, site inspection, preliminary approval, cabinet approval and final approval through the relevant Free Zone board process.  

Private Free Zone status is therefore more suitable for larger export-oriented projects, not for a typical small or mid-sized market entry. A mid-sized manufacturer setting up its first Egyptian production site should carefully assess whether the benefits justify the complexity.

7. Buying or leasing an existing factory — fast, but rarely the cheapest route

Another option is to buy or lease an existing hall. This can be attractive if a company needs to start quickly or wants to build a pilot operation first.

Advantages:

• faster start of production,
• existing infrastructure,
• less construction time,
• often existing access roads, power, water or administration,
• possible existing approvals.

But there are risks:

• unclear ownership or use rights,
• unapproved extensions,
• insufficient power capacity,
• missing fire protection,
• old floor slab,
• poor roof insulation,
• unsuitable clear height,
• old lease or usufruct contracts,
• unpaid fees or previous violations,
• restrictions on change of use or sale.

In 2026, IDA published new rules allowing the leasing of existing factories under specific conditions. These include implemented building permits, no building violations, an operating licence, industrial register, proof of seriousness and generally one year of actual operation. A full transfer of land and building requires stricter conditions, including three years of actual operation and full payment of the land price.  

Why new construction is often cheaper

Based on our project experience, simple new industrial halls in Egypt often cost roughly EUR 180 to 250 per m², and around EUR 300 per m² or more for higher specifications. This is an indicative range for standard steel industrial halls and depends heavily on spans, height, foundations, floor load, insulation, fire protection, crane beams, office share, MEP, ventilation, cooling and machine integration.

Important: this figure does not automatically include land, machinery, special foundations, heavy utilities, cleanrooms, cooling systems, financing costs or all authority fees.

Existing halls may look faster, but they are not always cheaper. The price often reflects location, time advantage, speculation, existing licences or renovation needs. Therefore, at GEMP Consulting we always benchmark existing halls against the alternative: land price + new-build cost + permit timeline + technical suitability.

8. Ready-made industrial units and industrial complexes

For smaller companies or pilot production, state-backed industrial complexes can be interesting. IDA describes these complexes as ready-to-operate units of different sizes with services such as administration, training and logistics. The goal is to help small and medium-sized industries integrate faster into local value chains.  

According to IDA, 16 industrial complexes in 15 governorates have been created, with 4,808 units and around 48,000 jobs.   Such units can be attractive for a market test. For long-term scaling, however, they are often too small or too standardised.

9. What costs what? A practical view

There is no single price list because location, activity, area, utility status, ownership model and timing matter.

Still, the cost logic can be summarised as follows:

• Government Industrial Land: the m² price is shown in the relevant land offerings on the digital industrial platform; city, activity, utilities and allocation mechanism are decisive.  
• Public Free Zone Land Use: according to GAFI’s brochure, USD 5/m²/year for industrial activities and USD 10/m²/year for service/storage.  
• Private Free Zone: no standard m² price; the land or hall may be owned or leased, while the Free Zone status is project-specific. Additional costs arise from guarantees, fees, export/revenue charges, customs-control setup and compliance.  
• New Standard Hall: from project experience, roughly EUR 180–250/300 per m², depending on specification.
• Existing Hall: highly negotiable; it should not be assessed only by m² price, but by licence status, construction quality, power capacity, fire safety and conversion cost.

10. Our recommendation: buy own land if Free Zone status is not essential

For many small and mid-sized European companies, own industrial land outside a Free Zone is often the most attractive solution, provided the business model is not clearly export- and customs-driven.

Own land is often better when:

• local Egyptian sales matter,
• the company wants to grow step by step,
• production is not 80% export-oriented,
• customs savings are not the main driver,
• a long-term asset should be built,
• future expansion is planned,
• and administrative simplicity matters more than maximum customs optimisation.

Free Zone status is stronger when:

• the export share is very high,
• imported inputs dominate,
• the local market is not central,
• the project is large enough for Free Zone compliance,
• and the business case truly depends on customs/VAT exemptions.

Investment Zones or Industrial Developers are a good middle ground when infrastructure and speed matter more than maximum land optimisation. Existing halls are useful when speed is critical — but they require careful legal and technical review.

Conclusion: the land decision is a strategic decision

Buying land in Egypt is not just a real estate decision. It is a decision about business model, customs status, taxes, export logic, local sales, financing, exit and long-term asset value.

The wrong plot can cost years. The right plot can create a scalable industrial platform.

At GEMP Consulting, we help companies make this decision in a structured way: location comparison, authority route, Free Zone assessment, plot selection, project profile, technical factory planning, local partner network, construction-cost logic and implementation through ramp-up.

The basic rule is simple:

The cheapest plot does not win — the plot that fits the business model wins.

Fazit: Die Grundstücksentscheidung ist eine Strategieentscheidung

Landkauf in Ägypten ist nicht nur eine Immobilienfrage. Es ist eine Entscheidung über Geschäftsmodell, Zollstatus, Steuern, Exportlogik, lokale Verkäufe, Finanzierung, Exit und langfristige Wertsteigerung.

Wer die falsche Fläche kauft, kann Jahre verlieren. Wer die richtige Fläche wählt, baut nicht nur eine Fabrik, sondern einen skalierbaren industriellen Standort.

Wir bei GEMP Consulting unterstützen Unternehmen dabei, diese Entscheidung strukturiert zu treffen: Standortvergleich, Behördenweg, Free-Zone-Abwägung, Plot-Auswahl, Projektprofil, technische Hallenplanung, lokales Partnernetzwerk, Baukostenlogik und Umsetzung bis zum Ramp-up.

Die Grundregel ist einfach:

Nicht die billigste Fläche gewinnt – sondern die Fläche, die zum Geschäftsmodell passt.

⸻

Sources: 

GAFI – Free Zones overview

https://www.gafi.gov.eg/English/StartaBusiness/InvestmentZones/Pages/FreeZones.aspx

GAFI – Public Free Zones brochure

https://www.gafi.gov.eg/English/StartaBusiness/InvestmentZones/Documents/Public%20Free%20Zones%20.pdf

GAFI – Private Free Zones brochure

https://www.gafi.gov.eg/English/StartaBusiness/InvestmentZones/Documents/Private%20Free%20Zones%20.pdf

GAFI – Investment Zones overview

https://www.gafi.gov.eg/English/StartaBusiness/InvestmentZones/Pages/InvestmentZones.aspx

Industrial Development Authority (IDA) – official website

https://ida.gov.eg/

IDA – Industrial land offerings / Egypt Digital Industrial Platform

https://ida.gov.eg/webcenter/portal/IDA/pages_industriallands

IDA – Investor Journey

https://ida.gov.eg/webcenter/portal/IDA/pages_investorjourney

IDA – Industrial Developer

https://ida.gov.eg/webcenter/portal/IDA/pages_industrialdeveloper

IDA – Industrial Complexes

https://ida.gov.eg/webcenter/portal/IDA/pages_industrialcomplexes

IDA – Results of 13th offering of serviced industrial land

https://ida.gov.eg/webcenter/portal/IDA/pages_news/newsdetails?para=299

IDA – Leasing existing factories / industrial land transfer rules

https://ida.gov.eg/webcenter/portal/IDA/pages_news/newsdetails?para=297

SCZONE – Industrial Zones

https://sczone.eg/industrial-zones/

SCZONE – Investment Opportunities

https://sczone.eg/investment-opportunities/

SCZONE – One Stop Shop

https://sczone.eg/one-stop-shop/

SCZONE – Rules and Regulations

https://sczone.eg/rules-and-regulations/

Reuters – Egypt, UAE sign major investment deal for Ras El Hekma peninsula

https://www.reuters.com/markets/deals/egypt-uae-sign-major-investment-deal-ras-al-hikma-peninsula-2024-02-23/

Reuters – Modon named master developer for Ras El Hekma

https://www.reuters.com/world/middle-east/uaes-modon-named-master-developer-egypts-ras-el-hekma-project-2024-10-04/

Reuters – Egypt signs $500m real estate project with UAE investors

https://www.reuters.com/world/africa/egypt-signs-500-mln-real-estate-project-with-uae-investors-2024-07-08/

Reuters – Talaat Moustafa launches SouthMED project

https://www.reuters.com/world/africa/egypts-tmg-says-new-mediterranean-project-will-cost-21-billion-2024-07-02/