Kenya’s real estate market is among those set to benefit from projects being implemented under China’s ‘Belt and Road Initiative’ (BRI).
This is according to Knight Frank’s latest report dubbed New Frontiers that shows that the sector will largely get support from the Chines projects.
The BRI was launched by China in 2013 under the banner ‘Silk Road Economic Belt’ and had become popularly known as ‘One Belt One Road’ by 2016, before being renamed as the Belt and Road Initiative in August 2016.
While the BRI’s blueprint focuses on 69 countries worldwide with which official BRI co-operation agreements had been signed as of October 5, 2017, Kenya is among 15 other markets whose top political leaders attended the BRI Forum for International Co-operation in Beijing in May 2017 and are currently categorized as ‘Non-Core Belt and Road’ countries.
South Africa, Ethiopia, and Egypt have already signed the BRI co-operation agreement. Aside from Kenya and Tunisia, 13 of the Non-Core BRI countries have joined the Asia Infrastructure Investment Bank (AIIB), an important institution in the actualization of China’s BRI.
The AIIB was launched in 2016, with China contributing US$50 billion in the capital. China’s impact on Kenya’s real estate market is already being felt, with examples being the acquisition of a stake by Chinese investors in the Two Rivers development, Erdmann Property’s housing project in Athi River and AVIC’s mixed-use development on Chiromo Road, Westlands.
“As a regional hub, Nairobi is currently the gateway of investment from the East into the continent of Africa and we are therefore very excited about the opportunities that this initiative presents to Kenya,” Ben Woodhams, Managing Director at Knight Frank Kenya said.
Kenya’s notable projects aligned to China’s BRI include the Mombasa-Nairobi standard gauge railway and Mombasa port’s upgrade and modernization program.
Other projects associated to the BRI in Africa are Doraleh Port in Djibouti, Mohammed VI Tangiers Tech City in Morocco, Abidjan Port in Côte d’Ivoire, China-Egypt Suez Economic and Trade Co-operation Zone, and Sokhna Port in Egypt.
“The development of the built environment along the BRI, whether infrastructure-related, logistics, townships or new urban settlements over the coming decades will be considerable,” the report notes.
Knight Frank has developed the ‘Belt and Road Index’ and ‘Non-Core Belt and Road Index’ with a view to bringing a new dimension and fresh insight into the analysis of the BRI, for which the associated markets are expected to increase based on growing dialogues with the Chinese government.