MIP WEEKLY CONSTRUCTION INDUSTRY REPORT NO.30
PERIOD: MARCH 14 to 20, 2016
Spreading Upper Hill’s economic boldness
15/3/2016 :The Standard,Business Beat, Page 9
- The Community area adjoins Upper Hill which has undergone one of the most dramatic urban redevelopments in recent times. It is not clear why developers flocked to this place. Was it the view or affordable land prices? Roads have been redone and driving through this part of Nairobi makes one feel as if there is something going on in the city.
- Upper Hill has become a self-contained ecosystem with many types of businesses feeding into each other. It also tends to suck wealth from other parts of the city, counties and even the world. Upper Hill represents what Nairobi should be, in a perpetual state of renewal driven by the creative genius of entrepreneurs. Read more
Design for long awaited Likoni bridge to be ready next year
17/3/2016 :The Standard, Home & Away, Page 2
- Commuters between Mombasa Island and South coast will no longer have to rely on the fragile ferry services at Likoni. Plans are underway to construct a bridge, Mombasa Gate Bridge, which will help ease congestion at the Likoni Crossing.
- The design of the bridge will be ready by the end of March 2017.The construction will be funded by Japan. Read more
Property owners fear children will waste fortune
17/3/2016 :The Standard, Home & Away, Page 6 – 7
- A report by real estate management firm Knight Frank, said that the children are most likely to squander what their parents have worked hard for.
- Others feel that lack of an early exposure to the family business is a recipe to disintegration later on in life. Some property owners may fear that they will invite undue competition when their children co-run the business.
- We should accept that not every person in the family can run a business.
- In Kenya, few property owners involve family members in their business, leaving them to their own devices later on in life when they can no longer run the show with the same vigour of yesteryear. This has been demonstrated through the numerous inheritance wrangles lodged in courts by heirs of the wealthy, especially in cases where written wills are absent or wealth has not been distributed.Read more
Sarit Centre to expand mall as competition rises
15/3/2016 :Business Daily, Page. 7
- Sarit Centre has unveiled a kshs.4 billion plan to construct a new building beside the existing mall as it looks to keep pace with upcoming shopping complexes and take advantage of Westland’s growing situation.
- The four-storey mall will add 250,000 square feet of retail space ,effectively doubling its size. The new building will be set up in the area currently occupied by a car park.Including demolishing one office building and a few residential apartments. Besides the new building, a multi-storey car parking silo will also be constructed to create more parking space and the existing mall will also be refurbished.
High end home prices recorded 2.9 pc growth in 2015
17/03/2016 :Daily Nation, DN2, Page 52 -53.
- The prices of high end homes in the country rose by 2.9 per cent growth in 2015, up from the 1.4 per cent recorded in 2014, according to a report by property management firm Knight Frank.
- Underperformance by other investment classes such as equities helped raise the attractiveness of luxury homes in Nairobi to high net worth individuals, fuelling the increase.
- Demand also slightly exceeded supply for the very top quality residential property, despite a recent increase in new builds.
- The poor performance experienced in 2014 was blamed on high supply of luxury property in Nairobi, leading to price stagnation, as well as successive terror by Somali militants Al-Shabaab.Read more
You don’t have to be rich to join the property market
17/03/2016 :Daily Nation, DN2, Page 52 – 53
- Below are 10 tips that will help you get started in real estate and turn investing in property into a lifelong pursuit to secure your financial future.
- Start small, start now.
- Real estate is not a get-rich-quick-scheme.
- Do not quit your regular job just yet.
- Do not understate the importance of due diligence.
- Surround yourself with the right team.
- Buy the worst house in the best neighbourhood.
- Bear in mind the 1 per cent rule.
- Good book keeping will save you a fortune.
- Do not fall in love with the property.
- Avoid the path of least resistance. Read more
Ernie and Campbell sues NHC for cancelling its Sh309million tender
17/03/2016 :Daily Nation,DN2, Page 52 – 53
- Real estate developer Ernie & Campbell has sued the National Housing Corporation for cancelling a Sh319 million tender for a mixed development project in Kibera months after being awarded the deal.
- The firm claims that NHC cancelled the tender in January using a section of the old procurement laws, which allowed the State Corporation to cancel a tender. While investigating the evaluation process.
- The NHC says Ernie & Campbell was awarded the tender under the old tender laws, which is why it called off the deal using the 2005 Public Procurement and Disposal Act.Read more
CIC to venture into real estate with Kiambu project
20/2/2016 : Cytonn Annual Market outlook, 2016
- CIC Group plans to venture into real estate with a planned Ksh.2.8 billion commercial and housing mixed-use development, which shall be composed of high-end, middle income and studio apartments on a 200-acre parcel of land in Kiambu. The development is set to be launched in Q2’2016, with consultants already doing site investigations.
- According to the 2014 Shelter Report by Habitat for Humanity, a projected 48% of the population in Africa will be living in urban centers by the year 2030. This figure is expected to increase to 58% in 2050.
- From Cytonn’s research, high-end malls in suburbs such as Westlands and Kilimani can have high rental yields of up to 10.2% and a high occupancy, averaging at 89%. Notable openings in the recent past include Garden City Mall and the Hub in Karen. Two Rivers and Riviera malls along Limuru Road are also to be launched soon, while older malls such as Yaya and Village market are getting refurbished and with international retailers such as Game and Carrefour entering the local market, the retail sector can only grow.
- Oxford Business Group ranked the Kenyan retail market as the 2ndmost developed in Africa, with a retail penetration of 30%. This growth is however not limited to Nairobi alone as devolution has helped in increasing urbanization and malls are also relocating to the counties. A good example is Buffalo Mall, which is opening branches in Eldoret after their opening in Naivasha. Kisumu has also seen the opening of three malls, namely West End, Tuffoam and Lake Basin Malls in the last year alone. We expect Kenya’s retail market to remain competitive due to favorable economic conditions, increasing middle class and infrastructural growth continue opening up locations for development. However, we believe that the number of malls that have come up and those in the pipeline are too many even with the competitive ranking of Kenya’s retail market. % of constructed buildings do not meet set standards. Read more