• Uganda one of the ‘last frontiers’ for property investment
• Investors leading the field in changing attitudes towards Africa
• Kampala residential property shortfall capturing global attention

To coincide with the much-anticipated launch of a brand new collection of luxury apartments in the Ugandan capital, Kampala, the CEO of Property Frontiers, Ray Withers, interviewed Clive Kefford, CEO of ProAfCo, developer of Jakana Heights, to get his views on why investing in Uganda is an exciting and lucrative opportunity right now.

Ray: So, Uganda. That is very much an emerging property market. Do you think international investors are ready to explore such an opportunity?

Clive: Professional institutional investors already have a huge appetite for investment in Africa because it provides opportunities and returns that are hard to find in other parts of the world. The difficulty is sourcing investments that are packaged up with the due diligence and research required. Individual investors are also beginning to understand this Africa is on the brink of being seen as the latest and smartest new place to invest.

Ray: Why Africa? Why now?

Clive: The biggest single change has been the huge reduction in armed conflict across the continent. There have been long periods of peace and stability in many countries in Africa and this has allowed good economic policies to be implemented and businesses to grow and operate much more easily and successfully.

Ray: What do you think is the most common misconception people have when thinking about Africa and Uganda?

Clive: The image most people have of Africa is of war, famine and disease and this because most of the news we see is about these issues but this is very unfair. If every report from the US was filmed in an area run by drug gangs or a in a housing project with no employment, we would have a similar negative impression of the States. Our image of Africa has become very distorted. Problems do exist in Africa but they are far from the whole story: most people’s lives are largely unaffected by these issues and professional people I know in Kampala have a lifestyle that I would say is better than most developed countries.

Ray: Do you feel that attitudes towards investment in Africa are changing?

Clive: Attitudes are certainly changing as the African economies grow and they start to become more integrated at a global level. Investors are leading the way because they cannot afford to have inaccurate information and as they invest more and more, a truer picture of Africa will start to become known.

Ray: What made you feel that there was a residential property opportunity in Kampala?

Clive: Uganda’s population is growing faster than any other country’s in the region and this has created enormous demand for housing. At the same time the economy has been growing at over 5% per annum for 30 years so people are getting wealthier and more people can afford to buy homes.

Kampala is the biggest city and has the most developed markets. Its population is growing faster than anywhere in the country due to increasing urbanisation. It is also an extremely attractive city to live in. It is very safe, has an ideal climate and the people are extremely friendly.

Ray: What is the current state of housing in Kampala?

Clive: Interest rates have recently increased in the run up to the election and in the middle income housing market many people are waiting for the economy to return to normal next year before buying. However, for top end properties such as Jakana Heights, the money invested into the economy before elections is likely to increase purchases.

The rental market at the luxury end has been affected by the slowdown in oil exploration however this will pick up in 2018 when oil production starts and a new set of expatriate workers will need to find quality accommodation.

Ray: How do you think the city’s housing market will look by 2030?

Clive: By 2030 I expect more international and institutional buyers to be investing in the housing market to meet the demand. Currently most developers and investors are from Africa and are just now beginning to come from the Middle East. As the institutional investors from Europe and America start to play a large part, the market will begin to mature.

Ray: Talk us through the key appeals of your new development, Jakana Heights

Clive: The site for Jakana Heights determined everything about the development. It is a large plot right on top of a hill overlooking Lake Victoria. It is a quiet peaceful place away from the hustle and bustle of the busy city. The site was only suitable for luxury development and we have made sure that the design, quality of build and finishing are all up to the same standard as the location.

The apartments are spaciously designed and most have great views. There is a swimming pool, saunas and steam rooms, a gym, bar and clubhouse for relaxation. There are also meeting rooms that can be hired for business and shops to provide the essentials so that almost everything you need is catered for you on site.

Ray: Why is the development a great investment choice?

Clive: Jakana Heights is a great investment choice because the yield on the properties is so high. Yields in Kampala on quality residential properties are generally very good at 10% but Jakana Heights is offering much higher returns than this, suggesting that the price will rise significantly during construction. Yields are in the region of 15% NET and the purchase price is from just $80,000 USD. This means that investors can make a great return whether they sell on completion or hold on and let it out.

For further details, visit www.propertyfrontiers.com or call the team on +44 1865 202 700.

• Nearly 40% of world’s population will live in Africa by 2010 (Knight Frank)
• Uganda to face 8 million unit housing shortage by 2030 (Uganda Bureau of Statistics)
• Africa is final frontier for property investors (Property Frontiers)

In the wake of President Obama’s recent visit to Africa, many have taken note of an increased emphasis on Africa’s role in the global economy. It is one of the fastest growing regions in the world, and the market is ripe for investment. International Monetary Fund GDP growth forecasts for 2015-2016 paint a promising picture of Africa’s growth prospects: an expanding population, a rise in foreign investment and nine of the world’s fastest growing economies located in Sub-Saharan Africa.

So is Africa’s growth potential ready to be unlocked? Buy-to-let investment specialists Property Frontiers believe so. The company, which is known for being at the forefront of global property investment trends, has recently launched a collection of luxury apartments at Jakana Heights, in the Ugandan capital city of Kampala. Available for investment from just $80,000 USD, the exclusive gated community is offering yields in the region of 15% NET.

Property Frontiers CEO Ray Withers is excited about the potential that Sub-Saharan Africa holds when it comes to property. Seen by many as the final frontier so far as investment is concerned, here he shares his top 10 reasons to take a closer look at Africa.

1. Double population growth expected

Africa’s population is expected to double over the next 25 years, the fastest growth rate of any continent. According to Knight Frank’s Africa Report 2015, by 2100 nearly 40% of the world’s population will live in Africa. This rapid increase in population will cause a huge disparity between supply and demand for housing.

2. Youngest population in the world

According to the World Bank, Africa’s median age was 19.7 years in 2012 and is expected to increase to 25.4 years in 2050, making it the continent with the youngest population. With this comes a boom in consumerism, bringing about both opportunities and challenges as the working-age population grows.

3. Political stability

Increased political stability on the continent and participation in local partnerships will continue to ease investors’ concerns. Uganda, for example, has experienced political stability and continuous economic growth for nearly 30 years. With neighbouring Kenya, Tanzania, Burundi and Rwanda, it has created the most advanced international political group in Africa and is benefiting from free trade between member countries and cooperation on major infrastructure projects, including the planned high-speed link from Mombasa to Uganda.

4. Huge housing shortage

Rapid urbanisation and rising income levels due to robust economic growth has created significant demand for residential property across Sub-Saharan Africa. According to the Uganda Bureau of Statistics, Uganda is facing a current housing shortage of 550,000 units, with 100,000 of these in Kampala alone. With the population expected to increase from 38 million to 63 million by 2030, current estimates project a housing shortage of close to 8 million units in 20 years’ time, with 1 million of those in Kampala.

This disparity in supply and demand for quality accommodation in Uganda presents an exciting and lucrative opportunity for both developers and investors.

5. Sustained economic growth

Much of Sub-Saharan Africa has been experiencing strong economic growth. In Uganda alone, the economy grew by 5.3% in 2014 and is forecast to grow by 5.8% in 2015/2016. This is producing significant demand from multinational corporations, local businesses, start ups and consumers for high-quality commercial real estate.

To add to the success story, oil has been discovered in Uganda in significant quantities, and will give rise to the requirement for office space and oil refineries, which will therefore create a ripple effect on other areas of the economy.

6. Rapid urbanisation

Urbanisation is occurring faster in Sub-Saharan Africa than anywhere else in the world as migrants move from rural to urban settlements. The real estate sector will play a major role in shaping Africa’s urban future, as city infrastructures develop and demand for low and middle income housing increases.

7. Expanding middle classes

Africa’s rapidly expanding middle class is attracting overseas investors looking to capitalise on this growing market. According to South Africa’s Standard Bank, studies suggest that within the next decade, the number of middle class households across 11 Sub-Saharan African countries are expected to boom in the next 16 years from today’s 15 million to over 40 million by 2030.

8. Wealth of natural resources

Across the continent, new discoveries of oil, natural gas and minerals are promising to completely transform national balance sheets. This is leading to the need for further infrastructure – including transport routes and hubs, energy power stations and telecommunication networks.

With a wealth of oil, natural reserves and vast amounts of land for agriculture, the continent will likely play a greater role in servicing global oil and gas consumption. The continent holds one third of global mineral reserves and one tenth of global oil reserves, and produces two thirds of the world’s diamonds, according to PwC.

9. Rise in technology

Technology use is expected to increase rapidly across the continent in the coming years, according to McKinsey & Company. In 2013, 67 million people in Africa used smartphones and 16% of the population was online. By 2025, the report projected, Internet penetration will reach 50%. That’s 600 million Internet users, using 360 million smartphones. As a result, emerging technology, media and telecom companies will urgently require office space and housing.

10. FDI has reached highest level

Africa’s share of global Foreign Direct Investment (FDI) has reached the highest level in a decade, according to the Executing Growth, Ernst & Young Africa Attractiveness Survey. The study found that two of the main drivers of investment in Africa were a growing middle class and increased urbanisation, both of which support investment in real estate.

To play your part in Africa’s bright future, visit www.propertyfrontiers.com or call the team on +44 1865 202 700.