Multinationals are fast recognizing the opportunities in the East Africa region given strong growth indicators that see Ethiopia’s developing infrastructure, and investors whetting their appetites in Uganda and Tanzania due to growing economies and stable political environments. According to Kenneth Oigo, Associate Director of Profica East Africa, a leading property and construction solutions company that has been operating in Africa for over a decade, it is Kenya, however, that presents robust potential for investors, given its prime position in the region.
Profica has built up a strong track record in Kenya and Rwanda as well as fast-growing portfolios of work in Uganda and Tanzania. Oigo says, “The activity that we are seeing in Kenya suggests that it is the steppingstone to the rest of the region. Air France has resumed direct flights to Nairobi as of March 2018 after 18 years highlighting the growth of Kenya as an East African node. Various international airlines have set up transit in Kenya, and for some years now, large international agencies, such as the United Nations, have used Kenya as a hub from which they could reach conflict areas in the region.”
Oigo says that now that the East African region has stabilised there is huge development potential. “Multinationals are embedding themselves more firmly in Nairobi, given its infrastructure, thus enabling them to use Kenya as their head quarters from which to oversee their East African operations.”
Smaller multinationals such as global IT outfits, says Oigo, previously took a cautious approach when developing their presence in the area. They were less focused on injecting capital into developing local offices, and generally opted for serviced office spaces. Oigo suggests that these companies now recognise the need for a formal set up according to their particular specifications due to growth in the region and the need to better establish teams permanently in the region.
“At Profica, we have a number of multinational clients that are intent on developing their own niche spaces, and this is where, in particular, our turnkey Design & Build services are being utilised.”
Design & Build entails developing an existing space according to the client’s specific requirements, taking cognisance of their workplace functionality needs and developing an optimal, specific solution.
Oigo says that Profica has developed relationships with multinationals such as Booking.com: “Profica is currently continuing into a second phase of the company’s office expansion in Nairobi where we are appointed as the full turnkey Design & Build managers on the project, following completion of the first phase last year.”
Another successful project that has been recently completely is a superb office fit out for Google; a relationship previously established during the company’s South African office fit out, continued with two phases in Kampala, Uganda, and now completion of the third phase in Nairobi.
Oigo says, “Profica’s Design & Build capabilities have developed into a strongly coordinated service due to our ability to deliver through a streamlined, multidisciplinary and professional approach. This service diversification adds to our on-the-ground presence in the region and specialist project management capabilities that span multiple sectors such as healthcare, mixed-use development, commercial, logistics, industrial, retail and housing.”
Profica, long-committed to the East Africa region, is one of the sponsors of the East Africa Property Investment Summit (EAPI), which will be focusing this year on driving investment in the region. Oigo will be speaking at the event, which will be held on 24 and 25 April at the Radisson Blu in Nairobi.
The new service will allow Kenyans to sell and buy globally by linking their PayPal and M-PESA accounts
Safaricom (NSE: SCOM), PayPal and TransferTo have today announced a collaboration on a new service that will allow movement of funds between M-PESA and PayPal accounts, a huge boost to international eCommerce.
Qualifying M-PESA customers in Kenya can link their PayPal accounts to their M-PESA wallets, enabling them to easily and securely buy goods and services from merchants around the globe.
In addition, M-PESA customers can still receive and withdraw money from more than 140,000 agents across the country.
Similarly, the new service will give Kenyan merchants the opportunity to boost their reach and grow their business internationally.
“M-PESA’s collaboration with PayPal will open up global market places and the global economy to millions of Kenyans and Kenyan-based businesses. Beyond money transfers, this development ushers in a new era of speed and convenience beyond borders, as we work towards innovating robust platforms through which more entrepreneurs and consumers can benefit from the growing eCommerce industry”, said Joseph Ogutu, Director – Strategy, Safaricom.
To make online purchases, customers will be required to set up PayPal accounts, which they can top up in real-time using their M-PESA balances. Customers can then withdraw funds within a timespan of few hours to three days, depending on the transaction amount.
In addition to linking Kenyan businesses and shoppers to more than 18 million merchants around the world through PayPal, the new service will also allow local businesses to sell their goods and services to more than 210 million active PayPal users across the globe in up to 25 international currencies.
“PayPal’s collaboration with M-PESA is part of the company’s long-term strategy to enable e-commerce and democratise financial services on the African continent,” says Efi Dahan, PayPal General Manager for the Middle East, Africa, and Russia.
“We are excıted to brıng the M-PESA mobile wallet and PayPal joint services to the Kenyan market, which makes it more convenient and secure to withdraw and add money to their accounts while participating in the global digital economy,” said Dahan.
“We are proud to have been chosen by these two world-class payments providers to bridge the gap between the services offered in developed countries with those available in emerging markets – which is the cornerstone of TransferTo’s mission,” said Peter De Caluwe, CEO at TransferTo.
“This service is a major milestone in the evolution of cross-border mobile payments, in that TransferTo’s technology is creating a fundamental link between M-PESA users in Kenya and PayPal’s global network, and seamlessly connecting Kenyan shoppers and businesses to the global eCommerce world,” said De Caluwe.
Engineering students in Kenya have recently had a tough time after the Engineers Board of Kenya (EBK) disowned degrees from some universities. The body has now published a list of universities recognised for engineering courses.
University of Nairobi (UoN)
Jomo Kenyatta University of Agriculture and Technology (JKUAT)
Dedan Kimathi University of Technology
Kenyatta University (KU)
Technical University of Mombasa
Masinde Muliro University of Science and Technology
Uber has introduced a premium car option in Nairobi that will offer those in need of high end rides for special occasions an option to ride in style without breaking the bank.
UberSELECT will provide an option for a safe, comfortable and reliable ride – for all special occasions. The cars will be driven by experienced and highly-rated driver-partners to ensure that riders always get an unforgettable trip experience
The new offering will exist alongside uberX, which remains available for everyday trips and errands.
UberSELECT & UberX Pricing Compared
What can you expect from UberSELECT?
Newer, comfortable car models including 7 seater sedans
Liquid Telecom Kenya, part of leading pan-African telecoms group Liquid Telecom, is now providing free internet to Nairobi Garage’s newly opened Entrepreneurship Centre along Ngong Road in Nairobi, supporting up to 300 co-workers with free high-speed fibre internet connectivity of 150Mbps. The move forms part of Liquid Telecom Kenya’s drive to support businesses across Kenya with both internet and, now, software services too.
Adil Youssefi, Liquid Telecom Kenya’s CEO, unveiled the free connection at the launch of a joint Liquid Telecom and Microsoft event at the Entrepreneurship Centre outlining the two companies’ partnership, which provides international software, such as Microsoft Azure, on the cloud across Africa.
“Liquid Telecom will be offering Microsoft cloud services and applications that developers and IT professionals can use to build, deploy and manage applications across the continent,” said Adil. “This means our internet infrastructure across Africa will now enable companies and entrepreneurs to operate with international software based on easy access to cloud products and services that we are now delivering through our partnership with Microsoft.”
The Liquid Telecom and Microsoft deal offers a cloud connectivity service level agreement that bundles together data and cloud services to ensure that businesses never run out of data bundles, ensuring their operations are seamless.
Liquid Telecom is also offering Microsoft Azure enterprise customers in Africa a Microsoft ExpressRoute service; a reliable, cost-effective, lower latency, faster and highly secured connection over the internet into European-based Azure clouds.
Microsoft Azure ExpressRoute offers an extension to on-premises networks into the Microsoft cloud over a private connection facilitated by a connectivity provider. With ExpressRoute, connections are established onto the Microsoft cloud services, such as Microsoft Azure, Microsoft Office 365, Microsoft Dynamics 365, Enterprise Mobility suite and Windows 10.
The Microsoft cloud services offer business of all sizes in Africa numerous benefits. Microsoft Azure enables businesses to develop, test, feedback and retry their applications during development, meaning they can explore new avenues and new technologies.
Microsoft Office 365, meanwhile, offers businesses the ability to work from anywhere as long as there is an internet connection. It also offers access to the latest versions of Office at no additional charge and without having to uninstall and reinstall Office on everyone’s machines, while Microsoft Dynamics 365 provides businesses with social selling, content collaboration, mobile sales, planning and management, and intelligence.
Together, these Microsoft platforms offer enterprise mobility, allowing employees to carry out business activities through their mobile devices, accessing business information effortlessly, which can trigger greater business opportunities and lead to greater returns on investments.
Windows 10, one of the most secure operating systems, provides further security and productivity benefits, including allowing businesses to keep their data, devices and users protected around the clock, giving small and mid-sized business the benefits of enterprise-grade security and control without complexity or unrealistic costs.
For coworkers at Nairobi Garage’s Entrepreneurship Centre, accessing the Liquid Telecom infrastructure and Microsoft cloud will now come as part of a membership costing from Sh2000 to Sh15000 a month for fully enabled working space.
“At Nairobi Garage, we believe in providing more than just workspace to our members. We want to provide our community with the very best tools to allow them to innovate and thrive. Today’s partnership with Liquid Telecom is another exciting development for our new hub space, Nairobi Garage Ngong Road, and we look forward to welcoming old and new members to our state-of-the-art premises,” said Hannah Clifford, director of Nairobi Garage.
Poa! Internet, the low-cost community Internet provider, has launched unlimited Internet in bundles that start at just Sh10 per hour, drastically cutting the cost of getting online in a move to encourage the youth in Kibera and Kawangware to use the Internet to the full without worrying about their data costs.
“We believe the move to such cheap unlimited data will transform the way our customers use the Internet,” said Andy Halsall, Poa!’s Chief Executive Officer.
Poa! Internet, which was launched a year ago, now has tens of thousands of customers in Kibera and recently launched its services in Kawangware as part of its mission to provide Internet to the country’s low-income communities.
The launch of its unlimited mini-packages cuts the cost of using apps such as WhatsApp, which typically use around 44MB of data an hour, from a minimum of Sh27.5 using the closest competing service on offer, down to just Sh10.
“Our aim is that this move to Internet ‘time’ instead of data counting – right down to the smallest unit of one hour – will put our users onto a completely different plane of communication and Internet use,” continued Andy.
Unlimited data bundles represent an even greater dividend for Poa!’s customers when using data heavy apps such as YouTube or watching movies, These typically use around 700MB of data an hour and so the cost of watching a two-hour film when counting MB’s would usually be around Sh700. Using Poa! Internet time bundles, the cost will be just Sh20.
“We genuinely believe that in our mission to give every Kenyan Internet access, moving to ultra-low cost unlimited bundles is a game changer,” said Andy.
Poa! now plans a rapid expansion in its community Internet programme, which sets up its Internet points in local schools, clinics and community buildings, giving free Internet to these community groups. Poa! then uses the same Internet points to offer low cost access to paying users throughout the rest of the community.
The ISP has moved its entire pricing model to unlimited time bundles, now offering hourly, daily, weekly, and monthly unlimited usage.
Kwale County is this month launching free street Wi-Fi in Baraza Park and Ukunda and an online services portal, KwalePay, following an investment project by Liquid Telecom in high speed Internet to the county, which is one of Kenya’s poorest.
The county is launching KwalePay as a one-stop online gateway to all the county government’s services, meaning residents can get business licences, pay land rent and access council services from their mobile phones, home computers and cybercafés.
The new Internet services from Kwale County Government follow Liquid Telecom Kenya’s delivery of a 25Mbps fibre network connecting the county government headquarters and regional offices, and servicing Kwale’s new street Wi-Fi and digitalised services.
“The county’s Revenue Management System (RMS) will enable residents do all payments online, cutting long queues at the headquarters, and enhancing revenue collection and transparency,” said Juma Kingi the County ICT Director.
“In this, ICT is removing the human interface from revenue collection. We have developed a payment solution and integrated an SMS platform that will send reminders to residents to pay their renewals fees before their due dates, in a system we believe will now double our revenue collection,” said Kingi.
Liquid Telecom has also installed a Wide Area Network (WAN) for the county government, connecting its headquarters with its regional offices in Msambweni, Matuga, Lunga Lunga and Kinango via a 36km-radius network.
The installations now see Kwale join 39 counties across Kenya that have rolled out digitalised systems offering their services online, but the county is among the first few – notably including Nakuru and Kiambu – to additionally develop free street Wi-Fi.
“Our aim is to make county services accessible on mobile phones and in grassroot cybercafés, saving the residents time and money spent travelling to our headquarters. This will cut out long journeys, for instance, from Lunga Lunga to headquarters saving residents about Sh440 on transport alone,” said Anthony Mwamunga the Kwale County Government Chief of Staff.
The new network has also meant county staff are now able to use staff emails, where previously they had only personal Gmail or Yahoo accounts. “The county is also working on installing a call extension service across its offices to cut down its mobile phone calls costs,” said Kingi.
The development of high-speed Internet in Kwale has additionally opened up the county to new business opportunities and enabled residents to access services previously only available in Kenya’s major cities and towns.
Equity Bank, for instance, has launched 231 bank agencies across the county, in a move that has created jobs and saved further costs for residents, who are now able to access and transfer money with ease.
“We genuinely believe in the role that Internet connectivity plays in developing the economic prospects of a region through job creation and greater ease of doing business. This has been seen all around the world. But taking these services into some of Kenya’s must unequal counties is a mission of which we are very proud, and one that we shall continue to pursue with vigour,” said Adil Youssefi, CEO of Liquid Telecom Kenya.
Tilisi, the mixed-use megaproject set at the meeting point of Tigoni, Limuru, and Sigona, on the outskirts of Nairobi, has today announced the sale of 49 acres of its light industry zone to Africa Logistics Properties (ALP).
The sale accounts for over half of the project’s phase 1 build, for which Tilisi is selling fully serviced plots for light industrial/ logistics use, with paved roads, street lighting, water, electricity and ICT reticulation, sewage treatment plants, matatu stops and recreational facilities for workers within the warehousing zone.
“With the administrative and approval process now complete for Tilisi, and the legal agreements signed, we are delighted to announce this sale to this dynamic and professional logistics developer. Construction of our infrastructure for phase 1 will commence in July,” said Ranee Nanji Co- CEO of Tilisi.
Tilisi Logistics Park is set to create more than 1,000 local jobs on completion, and will be set on the southern spur of its 400-acre mixed-use development, which is one of Kenya’s leading real estate developments, creating a new satellite town on the city’s outskirts.
Tilisi is the nearest megaproject to Nairobi’s city centre, located close to the junction of Nairobi’s new southern bypass, the Northern by-pass and just off the Nairobi – Nakuru Highway, which is the main road cargo route from Mombasa port to western Kenya, Uganda, and Rwanda, currently being upgraded to a six-lane highway by China Wu Yi Construction Company Ltd. “Being set on major arterial roads on the West of Nairobi and within easy reach of the airport was a critical factor in the design of the Tilisi masterplan,” said Kavit Shah, Co-CEO of Tilisi.
Tilisi’s location also makes for an easy reach from Kenya’s main airport, which remains one of Africa’s biggest airports for cargo. With a cargo capacity of 20.3m tonnes, according to the Kenya Airports Authority (KAA), Jomo Kenyatta International Airport is a major hub for regional traders, especially in the global flower business, which requires rapid transport.
The location additionally allows tenants and future owners to bypass the congestion through Nairobi, resulting in more efficient logistics in terms of time and cost.
ALP, which is developing Africa’s first grade A warehouses for rental occupiers in Nairobi, has bought its largest land purchase at Tilisi.
” The 49-acre site we are acquiring from Tilisi will be the location of our second modern grade-A logistics and light industrial park in Nairobi which will give strategic access to both Nairobi and the Western Kenya corridor for companies who operate from our facilities,” said Toby Selman, CEO of ALP.
Tilisi has dedicated 90 acres to warehousing in its first phase of development, with a further 41 acres remaining after its 49-acre sale to ALP. ALP will develop 80,000 square metres of international standard grade-A logistics and light industrial warehouse space for rental occupiers, while the remaining Tilisi plots are available for sale and are designated for owner occupiers to build their own units.
“ALP and Tilisi have complimentary business models, offering multinationals and domestic Kenyan producers a choice of an ownership model or rental model.” said Kavit Shah.
Africa Logistics Properties (ALP) has today announced the launch of Kenya’s first ever grade A logistics and distribution parks for the international and local occupier rental market in order to improve much needed supply chain infrastructure in the country.
The company today announced two land purchases situated in the North and West outskirts of Nairobi, unveiling the purchase of 22 acres at Tatu City, in Ruiru, and 49 acres from Tilisi, towards Limuru.
The two warehouse parks will offer international standard warehousing to multinational and local regional companies in the logistics, retail, light industrial, FMCG and e-commerce sectors.
Kenya is among many African nations suffering losses on inadequate warehousing facilities, with the cost of moving goods in Africa estimated to be up to three times higher than in developed countries, accounting for as much as 75 per cent of retail prices.
“Economic development in Africa now rests significantly on the development of modern grade A industrial and logistics warehouses, which we are moving to build across targeted African capital cities, beginning with Nairobi,” said Toby Selman, the Co-Founder and CEO of Africa Logistics Properties (ALP).
“We have now started construction at the Tatu site, while the construction of infrastructure and road junctions at our western Nairobi site is due to commence in the coming months.”
The design specifications for the ALP warehouses conform with international building standards. “Once complete, the units will also be managed to international property management standards by ALP’s team,’ said Selman.
The company expects to create up to 500 jobs in each of its new warehousing parks.
At Tatu, ALP will be creating 50,000 sqm of grade A warehouse space, to be called ALP North. It has, this month, also agreed terms with an international company for the park’s first rental lease, for 14,000 sqm of warehousing, in Kenya’s largest industrial lease to date.
Each warehouse will provide raised loading bays, 12m high operating eaves, large column grids of 12 x 24 metres, high load capacity, laser levelled flooring together with large high capacity truck yards and parking.
“These specifications enable operators to store up to eight pallets vertically, leading to lower storage costs and overall higher operating efficiencies,” said Selman.
Occupier service charges will also be lower than traditional ‘godowns’, thanks to environmental features such as solar power – with mains and generator back up – and rainwater harvesting.
ALP recently completed the first closing of its oversubscribed initial fundraising, raising $50m from CDC Group, the UK’s development finance institution, and from IFC, a member of the World Bank Group.
Other institutional investors include Maris, a Nairobi based private investment business focused on sub-Saharan Africa, and Mbuyu Capital Partners, an African focused UK based asset manager. ALP also announced last week a $4m investment by DOB Equity, a leading Dutch family office, closing its initial round of equity investments.
The scale and speed of the investor engagement has been driven by the expected economic impact of ALP’s investments and the ALP’s team deep sector experience and execution capability.
“ALP helps to drive down logistical costs by providing grade-A warehousing facilities that deliver built-for-purpose supply chain infrastructure. This infrastructure will create efficiencies that should lead to lower prices for consumers. It will also help both international and local companies to focus on their core business growth instead of having to construct, finance, manage, and maintain warehouses on their own,” said Selman.
ALP’s management team has 40 year experience in developing modern warehousing across emerging markets, having previously built 1.5 million square metres of modern warehousing across Eastern Europe.
An under supply of A-grade quality warehouses, and high demand by tenants for quality spaces, has presented a number of new opportunities for development in East Africa.
In Kenya, the industrial scene is slowly starting to grow and it is soon expected to change the landscape of the country, largely due to key logistics developments like the Africa Logistics Properties (ALP) developments in Tatu City and Tilisi, Actis’s new foray into the sector, as well as Infinity Industrial Park.
According to the Broll Kenya Market Report H1 2017, to be launched on 5 April at the EAPI Summit in Nairobi, key challenges within the industrial market still comprise an undersupply of A-grade quality warehouses, lack of multiple access points from warehouses to major highways, increased levels of traffic in and around Nairobi, and incomplete government projects which are meant to boost the manufacturing sector.
“Kenya’s strategic location makes it a critical transportation hub for logistical warehousing,” said Gordon Bell, Director and Head of East Africa Operations, Broll Property Group.
Unpacking this growing trend, this year’s EAPI summit will once again feature leading real estate development and investment companies from over 23 countries, including representation from all country members of the East African community.
“This year’s EAPI Summit agenda focuses on unlocking new areas of growth for East Africa’s real estate markets. In keeping with the growing interest and opportunities in the regions’ logistics industry, we have been able to bring together the sector’s largest investors, developers and operators. CDC, Emerge Developments, The IFC, Actis, ALP, Improvon, Chandaria Group and Bollore Logistics will all share their views on how to tap into East Africa’s lucrative industrial sector,” said Kfir Rusin, Managing Director of API Events.
The cost of moving goods in Africa is estimated to be on average two or three times higher than in developed countries and transport costs can count for as much as 50-75 per cent of the retail price of goods. The recent announcement by the CDC Group, in partnership with the IFC, to invest in ALP’s Nairobi developments, shows growing investor support for development on the continent and in particular Kenya.
“The existing logistics and supply chain industry across Africa is extremely fragmented and inefficient due to a lack of quality fit-for-purpose infrastructure. This has hampered the development of much needed supply chain and distribution operating efficiency improvements, said Toby Selman, CEO Africa Logistics Properties.
“Africa Logistics Properties is addressing this by developing the first pan-African portfolio of built-for-purpose modern grade-A logistics and distribution centres across key target Africa capital cities for the occupier rental market. Our first two projects will be in Nairobi and our pipeline stretches across Sub-Saharan and North African cities,” he said.
The lack of quality international standard warehousing space has long been a constraint on business growth and economic development. Such new developments now aim to improve operational efficiencies by reducing waste from poor storage, increasing the speed of product delivery and improving product security.
Commercial property development within Sub-Saharan Africa has, over the last decade, been concentrated on both the retail and office sectors, while logistics development has been side-lined, often due to uncertainty over market demand.
With volumes increasing, so has the demand for high quality space from retailers and consumer goods manufacturers seeking to expand their African operations and improve distribution networks and supply chains. A number of logistics and industrial parks are in the pipeline as part of wider urban developments such as Rendeavour’s Tatu City near Nairobi and Roma Park in Lusaka. Well situated near main ports, these locations have been identified as hotspots for logistics developers.
It is yet to be proven, however, that occupiers can be attracted in large numbers into the new developments:
“Although clearly dissatisfied with their existing accommodation, occupiers need to accept that gaining the efficiencies of modern space could mean moving further out of town and may lead to rent increases of up to 50 per cent. This will be the big test for Actis and ALP,” said James Hoddell, MD of Emerge Developments.
“Looking at the rapid growth of demand for warehousing in East Africa, the future of the African logistics sector is a topic we can no longer ignore. There are important questions that need to be answered, as affordability is still a problem. Can the industry adopt technology to bring the building costs associated with warehousing down? In terms of return on investment, how does warehousing compare with commercial and retail sectors? These discussions will be important for the future growth of this sector on the continent,” said Rusin.
With more than 400 delegates registered to attend, this year’s summit will also discuss the move into Kenya’s counties, new infrastructure projects, student housing, retail oversupply vs opportunity, as well as the growing role of pension funds in East African real estate.
The two-day conference will be held from the 5-6 April at the Radisson Blu, in Nairobi, Kenya.
Some of the notable companies in the industry attending include Fusion Capital, Africa Logistics Properties, The IFC, Old Mutual, Sanlam, Mara Delta, Stanlib, Jones Lang Lasalle, Stanbic Bank, The NSE and Safaricom Pension Fund.