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.

Tourism which is one of the biggest drivers of commercial real estate at the Coast has been under-performing for the last three years due to a decline in tourist numbers.According to the 2014 PwC hospitality outlook report, the Kenyan hotel occupancy level is expected to fall below 53 per cent this year and 2016 due to perceived insecurity.

Tiancai said villa prices have risen by more than 10 per cent since January, driven by investors taking advantage of low prices.“They see it as appropriately priced property, which will appreciate immensely once the tourism industry starts to pick up.”

However, property consultancy firm Knight Frank’s MD Ben Woodhams warned investors to be extra careful with commercial real estate at the Coast adding that it is difficult to predict when prices will adjust.“The situation at the Coast is not that good currently and I don’t see property prices rising anytime soon,” he told the Star.

Sultan Palace Development is owned by China-based Jiangxi Xinyu Real Estate Development.

Source:The Star



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