Contractor appointed on $35bn megaproject to build new Egyptian city

Neil Gerrard Senior Editor, Construction Briefing

07 October 2024

Modon Holdings engages with investors over the Ras el-Hekma megaproject in Egypt (Image: Modon Holdings)

Egypt-based Orascom Construction has signed a framework agreement as a primary contractor for the first phase of the construction of a new city on Egypt’s Mediterranean coast.

The move came after Egypt’s New Urban Communities Authority and sovereign wealth fund the Abu Dhabi Developmental Holding Company (ADQ) signed a deal to invest $35 billion in ‘New Ras el-Hekma’. The development grants ADQ the right to develop 170 million square metres of land, as part of what is reportedly Egypt’s biggest foreign investment deal.

Last week (4 October), ADQ appointed Modon Holding as the master developer for the megaproject, 350km north of Cairo.

Modon Holding will be the master developer for the entire development and will also undertake responsibility as the developer for the first phase, which is expected to cover 50 million square metres.

It has appointed Orascom Construction as one of the primary contractors for the initial phase, under a framework agreement. It has also signed a memorandum of understanding with Elsewedy Electric to explore opportunities for supplying building materials and collaborating on industrial parks, manufacturing, operations and maintenance.

Under more memoranda of understanding, Abu Dhabi Airports will collaborate on airport strategic planning, design, development and operational support, and Abu Dhabi national energy company TAQA will explore cooperation opportunities in relation to the development, financing and operation of greenfield utilities infrastructure projects, water desalination projects, electricity transmission and distribution and wastewater projects.

The remaining 120 million square metres will be developed in partnership with developers from the United Arab Emirates and the international community.

Modon claimed that cumulative investments in the entire Ras el-Hekma project could reach $110 billion by 2045, serving as home to up to two million people and creating 750,000 jobs.

Bill O’Regan, group chief executive officer of Modon Holding, said, “Ras El Hekma is an extraordinarily ambitious and complex project that will significantly contribute to the Egyptian economy through various stages of planning, design, and construction, ultimately bringing this new destination to life. Developing and delivering a masterplan of this magnitude requires sector-specific expertise and capabilities across a wide range of industries and is achievable only through strong strategic partnerships.”