The Green manufacturing trend that has seen setting up of assembly plants for e-bikes and e-motorcycles and government policy on industrial parks is contributing to demand in warehousing space across the country.
- Mid last year, Roam, which was founded in 2017, moved to a new 10,000-square-meter (approximately 107,650 -square-foot) space in Nairobi.
- In 2022, BasiGo received KSh 489 million to launch the sale and delivery of electric buses and open an assembly plant for the vehicles in Kenya.
- In December last year, the Ministry of Trade and Industrialization disclosed that the government is seeking to build an additional 30 county aggregation and industrial parks for value addition to boost exports.
Initially, it targeted 18 County Aggregation and industrial parks whose construction has begun. The addition means 48 industrial parks will now be built under the programme.
“Over the past six years, this trend has contributed to heightened demand, which has driven monthly prime warehousing rents up by 20 per cent to approximately US$ 6 psm,” notes Knight and Frank in the 2024/25 Africa Report.
The report notes that Government initiatives are playing a pivotal role in bolstering Kenya’s industrial sector, aligning with the transformative goals of Vision 2030 to shift the nation from an agriculture-reliant economy to a middle-income industrialised country.
The government has been actively promoting inward international investments through the establishment of Special Economic Zones (SEZ) and Export Processing Zones (EPZs).
Nairobi Gate Industrial Park, a pioneering SEZ in East Africa, for instance, includes a fully integrated customs control area, ultra-modern logistics, warehousing built to international specifications, and distribution centres.
This innovative ‘build-to-suit’ concept in Nairobi offers Grade A flexible space, optimal accessibility, efficient circulation, and ample loading facilities with volumetric capacity, all of which are key consideration for occupiers, particularly those of the international variety.
“Africa’s industrial markets have shown remarkable resilience, bolstered by government initiatives in countries like Kenya and Zimbabwe, with their Special Economic Zones (SEZ) and Export Processing Zones (EPZ) helping to create new demand.
“Additionally, the rise of e-commerce across the continent is driving requirements for efficient storage and distribution facilities, prompting the development of modern industrial zones equipped with state-of-the-art logistics infrastructure,” noted James Lewis Managing Director, Knight Frank Middle East and Africa.
Residential Market
The report says Kenya’s prime residential market remains resilient as prime rents have sustained an upward trajectory, registering a 5 per cent increase over the last 12-months.
Expats who earn in US dollars have benefitted from the strengthening greenback, which has lifted disposable incomes. In turn, this has underpinned demand for more luxurious rental properties, which are now in short supply.
The high levels of demand and dwindling high-end supply is best reflected in the rise in prime three-bedroom apartment rents which have increased by 5 per cent over the last 12 months to stand at between US$ 900-1400 per month.
Similarly, four- and five-bedroom houses have experienced rental rate rises of 6 per cent and 4 per cent, respectively, over the same period and command rents of between US$ 2000-4000 per month, depending on the location, property amenities/ features, and the perceived exclusivity of the neighbourhood.
The 2024/25 Africa Report includes comprehensive coverage of property markets in 19 countries, as well as insights from experts exploring retail, economic, and healthcare trends across the continent.
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