Availability and Cost of Commercial Property and Industrial Land for Foreigners - Kenya
Updated: Mar 2
The Kenyan real estate market has been growing steadily over the past few years and is beginning to attract more and more foreign investors. With the increasing demand for both office and industrial properties, the market value is on the rise, currently valued at KES 1.1 trillion (approx. US$10.2 billion), a significant increase from the KES 860 billion (approx. US$7.9 billion) reported in 2018.
Attractive Investment Opportunities
The Kenyan real estate market is a rapidly growing industry, with a continuous influx of foreign investors. The country is attractive to international investors due to its strategic location and potential for long-term growth. According to the World Bank, Kenya's real estate market growth is expected to reach 7.4% in 2020, up from 6.3% in 2019.
Commercial Property
The demand for office space and in Kenya is on the rise, with a particular focus on Nairobi. The Kenyan government has recently implemented a new plan to develop special economic zones and industrial parks, providing more options for foreign investors looking to enter the commercial real estate market. The average cost of commercial property for foreigners in Kenya is currently KES 7,800 (approx. US$70.9) per square foot, making it a much more attractive investment option for foreign investors.
Industrial Land
In terms of industrial land, the cost of purchasing land for industrial purposes is relatively low compared to other countries, with the average price per acre being KES 1.7 million (approx. US$15,570). This has enabled foreign investors to take advantage of the growth of the Kenyan real estate market, while also providing a much more accessible option for local businesses looking to expand. The Kenyan Ministry of Lands is also offering incentives for foreign investors to invest in industrial land development.
Residential Property
The Kenyan real estate market is not only attractive to foreign investors due to its potential for growth, but also due to its growing demand for residential property. According to the World Bank, the Kenyan residential market is expected to grow by 10.5% in 2020, up from 8.2% in 2019.
However, the average cost of residential property in the country is relatively high, which may not be an attractive option for foreign investors.
In conclusion, the Kenyan real estate market is an attractive option for foreign investors due to its potential for growth and the availability of commercial and industrial land at an affordable cost. With the government’s new plans to develop special economic zones and industrial parks, the real estate market in Kenya is expected to remain lucrative in the coming years.
Sources:
African Real Estate Society: “The State of the Kenyan Real Estate Market”
World Bank: “Real Estate in Kenya”
Oxford Business Group: “Real Estate in Kenya: Investing in Expansion”
Kenya Investment Authority: "Investment Opportunities in Real Estate"
Kenya National Bureau of Statistics: "Economic Survey 2020"