Monthly Newsletter - Issue 2, December 2016
Welcome to the Landmark Africa’s monthly bulletin, the last edition of the year. 2016 was a year with unexpected developments around the world and where global events had a profound impact on the Nigerian economy. The real estate and construction sector was not immune from the economic volatility, but remained resilient despite the challenges. There was a shift in the real estate market, from a landlord’s market to a tenants market where tenants and buyers had greater bargaining power when negotiating tenancy agreements and property sales.
Construction projects in the pipeline were mostly completed and the retail real estate sector experienced growth, with mall openings in some of Nigeria’s major cities, albeit occupancy levels were below expectations. Looking now to the year ahead, 2017, much of the volatility the country has experienced will continue, although there are signs of small optimism. The oil price has made a marginal gain and looking forward, there is continued optimism in the real estate industry that following the downturn, the recovery will see increased demand for commercial and residential real estate. 2017 is the opportunity to take a long term view.
The Landmark Africa team wishes you a very Happy New Year.
NEWS ROUNDUP
Structural problems, bane of mass housing deliver in Nigeria
Against the backdrop of unending clamour for mass housing as solution to housing problem of the country,a Lagos-based estate developer and Managing Director and Chief Executive Officer of Propertygate Development and Investment Plc, Mr. Adetokunbo Ajayi has noted that there are some structural problems that will not allow mass housing project in Nigeria see the light of the day.
Kenyan real estate firms eye diaspora billions
Kenyans in the diaspora have challenged the government to offer tax rebates for those who want to invest back home. They also want companies offering services in the money market and unit trusts to reach out to them to support their efforts to invest at home.
Dubai Investments says targeting real estate projects in Africa
Dubai Investments has said it is targeting robust growth in the real estate sector with a number of new projects in planning and execution stages across the UAE and other parts of the world.
Real estate firm eyes N20b from IPO
Authorities at the Nigerian Stock Exchange (NSE) have given the nod to a Lagos-based real estate company, Top Services Limited, to raise about N20 billion from its initial public offering (IPO).
South African real estate market survives torrid 2016
This year has been challenging for listed property especially in South Africa but the sector has nevertheless performed. While SA's listed property didn’t exactly shine, it beat other equities and remains a tenacious sector.
Finnish firm invests in Sh3.7b Meru mall as it back Kenyan real estate
A Finland-based private equity firm remains optimistic about the potential of Kenya's Real Estate Investment Trust (REIT) market. Taalari Plc, which is listed in Helsinki, invested in Kenya's first development Reit (D-Reit) issued by Fusion Capital.
Tanzania: Real Estate - Transfer of Property Land Rights in Tanzania
According to modern academic theory, owning property is less a matter of owning a physical resource, than it gives access to a bundle of rights attached to the resource.
West Africa opportunities despite macroeconomic headwinds
Given the macroeconomic headwinds affecting West Africa, where are the investment opportunities? This was among several topics tackled at the Super Return Africa conference in Cape Town last week.
The growing real estate market at the foot of Mount Kenya
If recent developments are anything to go by, the area around the foothills of Mount Kenya, Africa’s second highest mountain, is fast emerging as a hot spot for residential and commercial real estate.
CHARTS AND INFOGRAPHICS
Internet users in top 10 African countries, 2016
Internet penetration across the whole African continent is approximately at 28.6%. Nigeria, Africa’s most populous country leads the way in terms of actual internet users with approximately 97.2 million people and an internet penetration rate of 52%. The growth in internet penetration has been fast-tracked by the growth in mobile phone penetration which has enabled more people to have access to the internet.
INSIGHTS FROM THE REAL ESTATE DESK
The marketing of real estate in Nigeria is going through constant change and has continued to evolve. There is no longer a “one size fits all” approach to connect buyers or tenants with sellers or landlords; each approach used should be tailored to the individual property. To successfully market real estate requires uncovering opportunities, keeping up with the changing needs of customers and especially in commercial real estate, building relationships with prospective tenants and buyers.
Traditional marketing tools like flyers, brochures, outdoor billboards or banners remain key in a real estate marketing plan, however the Internet has become central in the marketing of commercial and residential real estate. Digital media and technology has changed the way buyers and sellers connect. Internet penetration is rising in Nigeria and having an online presence helps to amplify and increase the reach of marketing message so that a wider audience can be reached.
The efficient mix of digital and traditional marketing should be positioned where tenants make decisions to buy or lease. Hence, visibility is important to reach the target market. Traditional marketing methods are necessary, but not sufficient to drive sales and leases as many developers are currently battling with an oversupply of property in the market. Developers are competing for valuable market share and need to use flexible marketing and sales models as prospective tenants face more choice and have become more price conscious in 2016.
“In the tenants market, sales and marketing activities have to be closely aligned with clear strategies leading the marketing decisions. Value addition to properties and cost savings rank higher now in the buyer’s criteria than in past years.” – Ima-Abasi Isip, Business Development Officer, Landmark Group
CURRENT PROJECTS
UPCOMING EVENTS SCHEDULE
Modern Airports Africa 2017
Date: Wednesday, January 18, 2017 – Friday, January 20, 2017
Venue: Nairobi, Kenya
AfricaBuild Lagos 2017
Date: 14-16 February 2017
Venue: Landmark Event Centre, Lagos
MIPIM
Date: 14 -17 March 2017
Venue: Palais de Festivals, Cannes, France
East Africa Property Investment Summit
Date: 5 – 6 April 2017
Venue: Radisson Blu, Nairobi
Housing for Africa Conference and Expo
Date: 23 May 2017
Venue: Gallagher Convention Centre, Johannesburg
Africa Construction Summit 2017
Date: 30 - 31 May 2017
Venue: (TBC) Munich Germany
For more information:
GRI Africa Summit 2017
Date: 30 – 31 May 2017
Venue: TBC
COBRA 2017
Date: 29 – 31 August 2017
Venue: London
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