Billions poised for Africa’s real estate sector

Craig Smith1The growth and opportunity displayed by a diverse spread of International funds, DFIs, banks, PE firms, institutional investors and others is evidence that despite apparent indifference to African opportunities in SA boardrooms, the continent’s real estate sector has evolved

This is the view of Kfir Rusin, the host of the most significant annual gathering of capital investors in African real estate, the 10th annual Africa Property Investment (API) Summit taking place from 2-3 October in Johannesburg, whose stakeholders have been more active in the first half 2019 than in the previous 24 months.

“In the first two quarters of 2019, we’ve tracked 10 significant transactions in excess of more than a half a billion dollars across multiple jurisdictions and sectors by API Summit stakeholders,” says Rusin.

The growth and opportunity displayed by a diverse spread of international funds, DFIs, Banks, PE firms, institutional investors and others is evidence that despite apparent indifference to African opportunities in SA boardrooms, the continent’s real estate sector has evolved, and become increasingly more liquid and provides value in key nodes and sectors.

Some of the most high-profile deals include well known listed funds and global investors including Growthpoint Investec African Properties Investment Fund (GIAPF); Grit Real Estate Income Group; WeWork, Centum Real Estate, Nedbank; Standard Bank, the IFC and the UK’s CDC.

For investors and developers looking for data and partners experienced in African development or looking to sell prime assets, these are the men and women responsible for structuring and executing these mega deals who will be at this year’s conference, confirmed Rusin. These include GIAPF’s managing director Thomas Reilly; Grit’s CEO Bronwyn Corbett; multiple senior investment officers from the IFC; Standard Bank’s head of Africa real estate, Niyi Adeleye, the CDC’s Illaria Benucci, Centum’s RE MD Samuel Kariuki and many more in attendance.

The high value transactions, while not a repudiation of the South African listed sector’s muted view of the African opportunity, do provide a compelling narrative that the continent’s property markets are investable, but require nuance and insights.

According to noted real estate analyst Craig Smith of Anchor Stockbrokers, Africa’s top markets are “definitely a more attractive entry point than 18-24 months ago” but cautions that investors still need to exercise a “higher level of diligence” when investing.

An analysis which may explain, the increased diversity and complexity in these deals, said Rusin. “We’re witnessing sophisticated deal structuring in affordable housing; hospitality; logistics; office spaces and mixed-use, across countries and regions.”

Alain Charles Publishing, University House, 11-13 Lower Grosvenor Place, London, SW1W 0EX, UK
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