Nairobi’s skyline is changing, propelled by
multinationals setting up regional offices and a
growing demand for high-end housing. Le’ Mac, is a
proposed 22 storey tower, featuring both
residential and commercial components. The Dubai-
styled project is being developed by a local firm,
Mark Properties, and will cost an estimated US
$41.5 million upon completion in 2015. Ravi Vasta,
managing director of Mark Properties, told How we
made it in Africa’s Dinfin Mulupi how an influx of
expatriates and diplomats is spurring demand for
unique real estate projects in Nairobi and his
ambition to develop the tallest building in East
Africa.
What inspired you to develop Le’ Mac?
We wanted something new for Kenya and unique. We
started Mark Properties in 2004 and since then we
developed two luxury properties in Lavington (a high
income residential suburb in Nairobi). For the Le’
Mac project, we specifically wanted something
unique that would attract investors. We took our
team of consultants to Dubai where there is a lot of
such projects, after which they designed Le’ Mac.
How far has work on the development progressed?
We have started excavation at the 1.8 acre piece of
land in Westlands (an upmarket suburb of Nairobi)
where the Le’ Mac project will be constructed. We
will begin construction towards the end of April and
we expect to complete the project by the end of
2015. Le’ Mac will have business space on the
ground floor that will accommodate a banking hall
and coffee lounge. The next six floors will be
dedicated to office and commercial space. We will
have another six floors of residential space and a
double storey Le’ Mac Sky club housing a gym, spa,
steam and sauna rooms.
Describe the market response since the launch of
Le’ Mac.
We have placed six floors of one to three bedroom
residential [apartments] on the market, the majority
of which is sold out. However, the market is slightly
slow because of the elections and the high mortgage
rates, which are just starting to come down.
What kind of buyers are you targeting?
About 90% of the people who have bought the
residential spaces are doing so for investment
purposes. They don’t want to live there themselves
but they are targeting diplomats and expatriates who
are coming to work here. Le’ Mac looks and feels like
a five-star hotel. Our services have been tailored to
fit international standards, which is what expatriates
are used to. For instance, we are investing a lot in
security systems within the building. Investors will
make good returns. The majority of the buyers are
local investors and the diaspora.
They would like to
own property, but the price of land in preferred
locations for these kind of investments is too
expensive. For instance, in [Nairobi’s] Westlands
[area], you would need nearly 100 million shillings
($1.15 million) to purchase a quarter an acre of land.
You focus on luxury properties while research is
showing saturation in this market. Your thoughts
on this?
There is still demand for luxury projects especially as
an investment proposal. Investors buy luxury houses
mostly for rent. There is a lot of demand for houses
on rent and investors have the money to purchase
luxury houses. We are seeing more expatriates
coming to Kenya and they want houses that match
up to international standards.
Low cost and medium housing is for the local market
only. This market is totally dependent on the
mortgage rates. When it goes up, the market goes
silent. If there are special rates, the market starts
booming. Because of the high mortgage rates, people
prefer to rent instead of buying.
Mortgage rates need
to come down to 10-12% ( currently between 13-20% ).
We also need more investors in the real estate
sector .
Describe some of the challenges you face in
developing these properties.
We face challenges dealing with the government
especially due to delay of paperwork. The good thing
is that today we can access most of our construction
requirements in Kenya. It is very easy to source
materials, which was not the case ten years ago.
Can we expect similar projects such as Le’ Mac?
We are looking for land where we intend to develop
another high-rise project after we finish developing
Le’ Mac. We want to build the tallest building in
East Africa. That will be our next project. We will
have commercial space, hotels, residential space and
shopping malls. We will combine everything in one
tower. We need new and unique things to attract
more investors. These kind of projects show that
Kenya is progressing. Dubai became an icon because
of its tall buildings. We want the same in Kenya,
something that will attract tourists and even further
investment in the industry and the country.
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