Real Estate

For the past two decades, the Kenyan real estate market has grown exponentially as evidenced by its contribution to the country’s GDP which grew from 10.5% in 2000 to 12.6% in 2012 and 13.8% in 2016. The growth is driven by;

1. Infrastructural developments such as improved roads, utility connections, upgrade of key airports;
2. Stable GDP growth which has averaged at 5.4% over the last 5 years against a Sub- Saharan average of 4.1%;
3. Demographic trends such as rapid urbanization at 4.4% p.a against the world’s 2.5% and population growth averaging at 2.6% p.a; and
4. High total returns averaging at 25.0% against 12.4% in the traditional asset classes.

Afritrade Investment believes in assisting project with alternative means of finance with the development of unique trends due to the above factors across the various real estate themes, investors can seek to gain high returns and buyers sought aspirational lifestyles and quality products.

Afritrade can assist in capital raising through the following:

Equity financing: Equity financing as a means of raising money for real estate investment involves the sale of ownership in order to raise money.

Presales Financing: Presales is one of the most common financing methods in Kenya today. This is where you make early sales on the project before the project has been completed. Developers use renders (the property models and visuals) to entice investors to purchase the products before the project has been developed.

Joint venture: Location is key when making a real estate investment decision. Getting land at a strategic point is expensive and may deplete the developer’s ability to finance the rest of the project. Doing joint ventures which involve including another person into the project who has the ability or resources needed is key. The simplest and common form of join ventures is where the developer partners with the land owner to construct the project. The land owner can get payment by either getting units from the finished project or getting a share of the profits from the finished project.