Haram City

In the last quarter of 2006, the Group launched its budget housing subsidiary Orascom Housing Communities (OHC), a company strategically focused on developing affordable housing within large sustainable and fully-integrated communities in Egypt, regionally and internationally. OHC is a joint venture with Homex, a vertically integrated home development company focused on affordable housing, headquartered in Mexico and listed on the New York Stock Exchange. Equity International and Blue Ridge, two private equity firms, are also investors in OHC. Orascom Development holds a 58% stake in OHC.

OHC has been allocated approximately 8.4 million sqm of land in 6th of October City, in the vicinity of Cairo, for this project. It is planned to develop 50,000 units over the next five to seven years. The town infrastructure will include schools, a hospital, commercial areas, a cinema complex, sporting clubs, garment embroidery and daycare centers, which will be operated and/or managed in cooperation with the Egyptian government and/or non-governmental organizations. In addition, it is planned that the project will include retail and commercial properties of which OHC will retain majority ownership and lease to third parties.

The development of the first phase commenced in January 2007, with actual construction starting in May 2007. The first residents moved into their homes during the fourth quarter of 2008. Construction work on two zones out of the planned eight zones was completed, and the main water line, electricity supply and sewage plants have been secured. During the second half of 2009, OHC has accepted to operate another sewage treatment plant to cater to the entire project land. A contract for the provision of the substation has been negotiated with the Egyptian governmental authorities and is expected to be concluded during 2009. Once this contract is finalized, this substation will be able to provide electricity to all of Haram City.

Al Fayoum

OHC has been allocated approximately 2.1 million sqm in Al Fayoum. Similar to Haram City's planned components, it is planned to develop 20,000 budget housing units. In 2009, OHC plans to start selling units in this project. In order to facilitate the purchases of budget housing units, the Group has established a mortgage company under the name Tamweel (see also Other Operations)