‘Nairobi has witnessed sustained growth since 2002. Today it has a vibrant securities market, a well-developed banking and insurance sector and is home to a growing number of international firms and investors seeking a foothold in this relatively stable and well-connected regional hub.
There is increasing over-supply in several areas of the Nairobi commercial and residential real estate market. Apartments, offices and malls may well experience higher levels of vacancy during 2016 as supply continues to outstrip demand. Barring any external shocks, higher interest rates and developers responding to market dynamics, we predict a rebalancing of the market in the medium term.
Successful developments going forward will respond to occupiers’ growing demand for quality. These will lease well and sell at a premium to the growing number of investors targeting the Nairobi market. Developers and investors, who do their research and create the right product in the right location, will still be able to generate healthy development profits in most real estate sectors.’Download PDF