Category Archives: real estate news

Real estate is where wealth will grow in 2016, says firm in report

Real estate is the best investment option this year even though politics will play a major role in determining returns from other key sectors.

Cytonn Investments 2016 Outlook Report released in Nairobi on Monday says local and foreign investors will continue reaping handsome returns since growth of the middle class and continued urbanisation create a growing demand for both residential and commercial developments across the country.

Cytonns is a real estate investments company that currently manages a Sh4 billion asset portfolio and has ongoing projects worth Sh50 billion.

The Cytonn investments manager, Mr Maurice Oduor, expressed optimism that if Kenya keeps politics out of development and business matters, a 5.5 per cent to 6.5 per cent growth is achievable.

“It is only President Uhuru (Kenyatta) and Deputy President William Ruto, who are politicians, while the rest are purely civil servants whose task is to deliver services to fellow Kenyans,” he said.

Chinese property developer pressing on with an upmarket holiday resort project in Kenya

Sultan palace Development Limited, a Jiangxi Xinyu Real Estate Development hopes for beach retreat. The property developer is working on a holiday resort project in Kenya’s coastal town of Kikambala which is about thirty minutes drive from Mombasa, one of Kenya’s biggest tourist resorts. Despite the travel advisory imposed on some areas in the Country by some other Countries, the project is still taking shape fast.

Although the tourists frequenting Kenya’s coast number has declined recently due to security concerns, the company says there is no reason as to why the country can loose on projects like these affecting the market, especially with the standard gauge railway set to be completed in 2017. The line once complete will shorten the journey times between Nairobi and Mombasa as the country’s middle class continues to grow. The line is as well expected to fuel a boom in domestic tourism.

Currently it takes at least 19 hours to travel between the two cities, however, this will be reduced to about four and a half hours to cover the 500 kilometers.

Is seeing believing? For some off-plan buyers, brochures do not tell the truth.

In 2013, Ms. Juliet Mazera decided she needed a house to call her own. After searching all over Nairobi for a house that would fit the bill of what she wanted, she stumbled upon a swanky gated community off the new Thika Highway on Kamiti Road.

The property development, which we cannot name in this article because the developers refused to talk to us, was the perfect place to be; the houses were modern, the location just a few minutes’ drive from Nairobi, the gardens lush, the walkways carob-paved, a huge perimetre wall to ward off louts, they were putting up a school inside the development… everything was perfect, and Ms. Mazera was hooked.

Seeing-is-believing

At the time the idea of gated communities was just beginning to pick up, and this was high up there in the quality and affordability scale. Phase One and Two were already complete, and oh, weren’t they beautiful on the glossy brochures! “For Sh7.6 million, we were offered a three-bedroom house in a gated community that had a fitness Center, a clubhouse and abundance of fresh air, among other appealing attributes,” says Ms. Mazera.

Role of property management in real estate growth.

In the past decade the skylines of Kenya’s cities and towns have been filled with magnificent skyscrapers.

They are statements of purpose, commercial success and faith in the future. Every day we see new ones and that counts for something in the form of income generation and employment for more than 70 per cent unemployed youth. What is not so visible is the upkeep of these structures over the short and long term. Property management is meant to capture both the value of the structure in terms of longevity of its technical life, as well as a reliable regular revenue stream.

Maintenance can be done in different stages. Reginald Lee defined those stages as follows:

  • Planning and design stage – which should be based on intended use and be as maintenance free as possible. In this stage a lot of money can be saved with the proper plan and design. For this reason, the building manager and maintenance personnel should be consulted during the early stages of the building design.

Prices of posh homes drop as supply rises in Nairobi.

Luxurious homes in kenya

 

Prices of luxurious homes in Nairobi fell slightly during the first three months of the year, according to a Knight Frank report. The Knight Frank Prime Global Cities Index quarterly report released last week ranks prime residential markets in 35 cities worldwide. It states Nairobi recorded a one per cent decline in prices of posh homes between December 2014 and March 2015.

Supply of high-end homes slightly exceeded demand, mainly due to developers responding to the rising foreign investor interest in Nairobi over the past few years. This is in addition to an expanding pool of local high-net-worth individuals seeking to buy trophy homes. The moderate growth in supply created room for price negotiation between buyers and developers, Knight Frank added.

Chinese firm builds holiday homes in Mombasa.

Diamond residence sultan palace

 

Chinese firm Sultan Palace is developing 198 vacation homes at the Kenyan Coast for sale despite the ailing hospitality sector in that region.The units comprise 50 coral stone beach houses, 16 villas and 132 condos.

General manager Liu Tiancai said hotel closures in the region have created accommodation shortage which is expected to boost the demand for vacation homes.“The decline in tourism numbers is only a short term occurrence. We have invested at the Coast because we believe that the country still has the potential to return to its glorious days sooner than many think,” he said.

TWO RIVERS DEVELOPMENT ATTRACTS USD 155 MILLION (OVER KES 14 BILLION) IN INVESTMENT

Two rivers development, which is a project of the Centum Company, has attracted USD 155 Million funding or over Kes.14 billion in debt and equity from The Co-operative Bank of Kenya Limited and AVIC International, Industrial & Commercial Development Corporation (“ICDC”).

A sum of USD 70 Million (over Kes. 6.3 Billion) in equity has been invested in the project by the AVIC international  Company. This is in addition to the USD 5 Million (over Kes. 450 Million) in equity invested by the Industrial and Commercial Development Corporation of Kenya. Also, the Co-operative Bank of Kenya has secured a local debt funding of USD 80 Million (over Kes. 7.2 Billion).

Nairobi, Mombasa and Kiambu have most expensive rental homes: Study

According to a report released by the Lands and Urban Planning Ministry, residents of Nairobi County are the ones who pay the highest rents in the Country. They are followed by Mombasa and Kiambu.

The most expensive neighbourhoods are from Nairobi fetching the highest value in the rental market. The report has it that 58,248 houses rent is above Sh20,000 per month. Three quarters of these are in Nairobi while 7,009 (or 12 per cent) are in the neighbouring Kiambu County.

The county of Mombasa owns 7% of the most expensive rental homes, Eldoret owns 1% of the most expensive homes in the whole country, its then followed by Lamu, Kericho, Kakamega and Isiolo.

You can now own your home while paying ‘rent’

In a bid to  cater for those unable to afford mortgages, a 300 houses tenant purchase scheme is currently underway in Nakuru.

Fusion Capital plans to build 1,000 housing units throughout the country in the next three years, of which 30 per cent will be sold through a tenant purchase arrangement that helps home buyers who cannot raise monthly payments required by mortgage lenders.

The company said it plans to build more houses to be sold under the scheme in all counties.

The company, together with a Nakuru landowner, created a joint venture known as Grandepark Estate to build 120 three-bedroom Montey Apartments.

Naivasha’s Buffalo Mall Now Reports 95% Occupancy

Buffalo Mall, Naivasha’s biggest shopping mall has now leased 95% of the mall. Kenya’s  top brands have already taken their place in the Mall. The developers are already set on a strategy to target Kenya’s Secondary Cities. The phase one of the mall was already complete on November last year only eleven months after construction started.

1

The developers have expressed satisfaction with the ongoing construction progress and quality of delivery on site and so far phase one has attracted different leading brands in Kenya.  Phase two has already attracted  an array of Kenya’s leading brands with more than 20% leased with a considerable expression of interest having been received for the balance of areas. This level of interest on provision of truly standard modern retail facilities in Kenya’s secondary cities is long overdue and hence the need for this level of interest.