UA-R-GC-1914-01-01-1990-11_Page-027

A.U.C. BOARD OF TRUSTEES November 1990 Campus Planninq and Bousinq Committee pinaDc. co .. itt •• Xaadi villa purcha •• Decision Paper In February 1988 the Board approved purchase of the villa at 4, Damascus Street, Maadi, on which the University holds an unfurnished lease. The price then approved was LE325,000, a figure which had been reached after hard negotiations with the owner. Following the Board action a preliminary contract of sale was prepared for signature by the seller, but he refused to take any further action and the transaction was suspended until, earlier this summer, he reappeared and said that he would not dispose of the property for less than LE450,000. After negotiation the price was revised down to LE400,000. We were prepared to purchase at this level on the basis that the interest savings during the two year period in which nothing had happened (and during which, of course, we had had continuous use of the villa under the unfurnished lease, the cost of which is nominal) more than equalled the additional sum he was now requesting. We accordingly informed him of our willingness to proceed provided t~3 Board approves the revised selling price. The total budget for acquisition of the villa is LE630,000. This includes the purchase price (LE400,000), estimated legal fees (LE30,000), and estimated property registration costs (LE200,000). The villa has recently undergone extensive overhaul (it is currently inhabited by Mr. Merchant) and we do not anticipate any significant outgoings for repairs and renewals which cannot be handled within the regular housing budget. It should be pointed out that the budget for registration fees is exceptionally high: this is because the Real Estate Registration Office will assess the value of the transaction on the open market price of the property and land without consideration of the unfurnished lease - this, we estimate, may be as high as LE1.6 million. We will be doing everything we can to minimize our exposure to registration fees: we currently have a petition before the Ministry of Foreign Affairs to be exempted from this tax under the terms of our protocol, and, if this fails, we may attempt delayin