Real Estate Moment

Homes Expo: There was also another real estate expo at Sarit Centre last week – and some of the price ranges observed included

– Two bedroom apartments in kahawa are Kshs 5 – 6M
– 3 bedroom in kileleshwa/kilimani Kshs 16 – 17M ($200,000)
– 3 br Athi River are Kshs 5 – 7 million ($70,000 – $90,000)

Other property prices of interest seen there, and also away from the expo include
Tatu City and other ongoing developments like Migaa and Thika Greens which are modern estate communities that encompass shopping malls, schools, community centres, club house, sporting facilities/golf course, medical centres etc.
– From Regent – twelve (12) units of 2-br flats in Umoja for Kshs 16 million ($200,000)
– New office space in the Nairobi area ranges from Kshs 10,000 to 15,000 per square foot – and at Morningside it’s 12,000 per sq foot ($150/sq.ft)
– In the newspapers was a 9-storey building for sale, which is located in the central business district of Nairobi with 99 year lease, is fully leased, and brings in annual income of Kshs 20 million ($250,000)
– From Kenya Valuers are some of the priciest real estate prices seen including; an acre of land in Kilimani for sale at Kshs 180M ($2.25 million) and another at Kshs 225M ($2.8 million), a 4=br house in Muthaiga for Kshs 150M, a 6-Br in Windsor for Kshs 180M, and a 5-br in Runda that rents for $7k/month.

Mortgage report: Was released by the World bank and Kenya’s Central Bank – and it showed that KCB and Housing Finance are the leading banks in the sector with about 4,000 mortgages worth Kshs. 17 billion ($212 million) each . Barclays have 742, CBA 238, Prime 651 and First Community with 157 – which presumably offers only sharia complaint products. Mortgages rates average at 14% up from 12.5% in 2006 – and there were 6,000 new mortgages in 2009 up from 1200 in 2006.

Developers Club: KCB Kenya’s largest bank and leading mortgage company has a developers club for local developers and held a session this week in Nairobi.

Some Highlights
– Mumo Musuva, an architect with Planning Systems talked about this being a very exciting time for Nairobi, currently ranked No. 102 in the large cities of the world with a population of 4 million and which is projected to become No. 73 with a population of 8 million – and with 60% of the country population below the age of 30.
– He’s also lead developer with Tatu City and they are going to use digital management & GIS, detect when someone leaves a tap open, cut off the utilities of tenant who don’t pay, collect rates and deploy that to infrastructure etc.
– He lamented the low quality of most real estate buildings & projects in Nairobi as developers have been chasing quick returns (ROI) – these will change to world standards including environmental designs as the requirements of working with large tenants are evolving.
– The definition of real estate is changing from owing a house or building to it being seen as a commodity – and this is evidenced with the current investment for speculative purposes and eventual roll-out of REIT’s.
– There are massive opportunities for developers in Rwanda, Uganda, south Sudan which KCB can finance.
– They also launched a new KCB property guide will feature developers. The bank also expanded its mortgage offerings (available at their 168 branches), to loans for Kenyans in the Diaspora at 7% in foreign currency as well plot & purchase construction loan – unlike with previous arrangement where one had to pay off a plot loan before commencing construction
– The developers forum which has 300 arranges fact finding trips abroad to China, and possibly South Africa, & Brazil – and Joe Mungai of Tamarind Properties advised any developers to take such trips before embarking on any large projects to learn concepts like construction for low end housing, waste treatment & gated communities.

REIT’s: The Capital Market’s Authority (CMA) is undertaking a review of the Real Estate Investment Trust (REIT regulations ) & rules that formulated they in 2009. They will get feedback from developers and real estate institutions on product demand, tax rules. D/L is March 25 2011

8 thoughts on “Real Estate Moment

  1. coldtusker

    Mortgage pricing is crazy. IMHO, until the rates drop to fixed 8% [sort of the magic number] over at least 15 years… the take-up will be slow.

    The ultimate mortgage holder should be the Resident not the Landlord/Developer.

    What I do not understand is why Nairobi Developers [or perhaps NCC] do not push for dense [skyscraper style buildings]. I prefer high-rise buildings with decent access to public transport.

  2. Anonymous

    Building height capped because of aircraft? Sounds… interesting. Aircraft can ascend to higher heights. They have been known to fly over mountains, and skyscrapers.

    Could it be many developers do not have the skills and know how to build high and like any human are afraid of the unknown?

  3. coldtusker

    Capping building heights [except for aircraft /takeoff/landing funnels/paths] is stupid!

    New York has 2 very busy airports & some of the world’s tallest buildings!

    Chicago has very tall buildings [among top 10] in the world yet has 2 busy airports. O’Hare is USA’s busiest airport.

    Hong Kong, Singapore, Mumbai, Tokyo, etc all have busy [much busier than JKIA] airports yet all allow skyscrapers.

    Don’t forget Dubai…

  4. Anonymous

    Correction, Atlanta is the World’s busiest airport in terms of passengers and number of flights.

  5. coldtusker

    Depends who you ask ATL vs ORD but the numbers are very close. In any event for the purposes of this discussion it makes little difference since ORD remains a very, very busy airport vis-a-vis Nairobi’s JKIA+Wilson

  6. Real Estate Note

    The real estate sector has benefited in a huge way from strengthening resource prices, thanks to low unemployment and higher incomes, not to mention the overall sense of invulnerability that’s come to pervade the Canadian mindset. Thanks a lot…

  7. BlogFront

    Hi Bankelele, is committed to uphold the quality standards of blogging. We strive to maintain and promote only the most credible blogs in their respective fields.

    Spam blogs or “splogs” has been a problem for some time now and people are getting confused about which blog to trust.

    We would like to thank you for maintaining such a reputable blog. We know that it takes time, effort and commitment to keep such a blog and as such, we have added your blog as one of the top Africa blogs.

    You can see your blog listed here:

    You can also claim your BlogFront Top Blogs badge at

    Thank you for keeping your blog credible. Let’s keep the blog revolution alive!

    Maria Blanchard
    Blog Revolucion

Comments are closed.