Egyptian investment firm Gates New Capital has launched a new real estate fund, which intends to leverage attractive growth prospects in the sector to target high returns.

The fund, named Compound Venia, is Gates New Capital's second real estate vehicle after its first fund achieved annual returns of 42% in 2017.

Compound Venia is a hybrid fund that combines debt and equity investments, aiming to generate returns of up to 20% per annum. The fund will focus on commercial, residential and hospitality assets in Egypt, seeking to capitalize on the country's improving economic and social climate.

Investment into the fund will be open to both local and foreign investors. The minimum investment amount is $100,000, with an expected lock-up period of five years.

Gates New Capital CEO Ahmed El Houssieny said the firm is confident in the Egyptian real estate market and will invest in prime assets in regions with high demand and growth potential.

Egypt's real estate sector has seen significant growth over the past decade, with an increasing population, urbanization and growth in tourism driving demand. Government initiatives, such as the New Administrative Capital and the New Alamein City, are also expected to boost the sector.

Compound Venia adds to Gates New Capital's expanding suite of funds, which also includes a private equity fund.

The firm, which was established in 2018, aims to become a leading investment firm in Egypt and the wider Middle East and North Africa region. It has a focus on sectors ranging from real estate and fintech, to healthcare and education.