Nairobi’s South C joins frenzy for apartments

Nairobi’s South C joins frenzy for apartments

On Ole Shapara Avenue in South C — one of Nairobi’s oldest estates, six newly built high-rise residential apartments fill the skyline that was lined up by trees only a few years ago.

The multistorey residential blocks that neighbour the Kenya Water Institute (Kewi) compound are occupied and as one drives past Amani Girls High School, at least three others, all under construction, paint the grim picture where stand-alone houses are fast-becoming a distant memory.

The estate along Mombasa Road is experiencing a boom in high-rise developments whose units include three, two and one-bedrooms as well as studio units.

Along Hamisi Road, five multistorey apartments, each with at least seven floors stand barely 200 metres apart. The trend repeats along Mugoiri, Othaya, and Mwingi roads next to the Kileleshwa Holy Trinity Catholic Church.

Data by real estate firm Cytonn shows that in 2018 alone, there were a total 3,289 approvals for apartment units across the city underlining the change in taste by real estate developers and residents.

Mr Nimrod Masaka from the Urban Planning department at City Hall says that change in ownership and appreciation in land value has fuelled the trend.

“In South C, we are seeing bungalows being removed and high-rise residentials coming up. Originally a bungalow that had one resident we are now seeing an apartment with nearly 30 residents,” he says.

Original owners from the 1970s and 80s have also handed over the houses in generational changes among families and investors (local and international) are trooping in to cash in on the land value that has increased overtime further fuelling the trend.

“In most of these estates due to change in ownership and appreciation in land value, where we had bungalows, there are now skyscrapers of up to 12 floors,” Mr Masaka adds.

Cytonn notes that in 2018 alone, Kilimani had the highest number of apartment units approved with 938 followed by Parklands at 565 units.

Kileleshwa was third with 494 approvals while South B and South C had 421 units between them as the city slowly marks an end to stand-alone houses.

Real estate expert Johnson Denge says that investors, faced with a fast growing population, space constrains, a spike in land prices and entry of multinationals into East Africa’s biggest capital, have been forced to look up into the skies.

“Investors are going high because there is no space to expand and the developers must now maximise on the one that is available, which means going up,” he says.

He adds that Kilimani has become a highly sought residential address for the growing upper middle-class and employees of multinationals working in the neighbouring Upper Hill and Westlands.

“Kilimani is an upmarket area and attracts the middle-class and would be middle-class mainly from the multinationals prefer the place. Zoning has also allowed for diversification in Kilimani and that explains the rise in mixed-use apartments,” he adds.

Upper Hill, which has for years been the number-one destination for multinationals has, however, lost its shine and had a paltry 32 apartment units approved last year- the lowest of all the neighbourhoods, according to the Cytonn report.

The low number of approved units in Upper Hill coincides with a decision by Coca Cola, European Union, Tullow Oil and PwC to shift their headquarters.

Under amendments to the Physical Planning Act in 2017, counties now have a freehand in determining the number of floors for residential and mixed-use apartments.

The zoning policy changes effectively made it easy for both landowners and developers to regenerate space allowing them to go up as high as 15 floors from the previous four-floor limit.

The areas include zone 4 that has Spring Valley, Riverside Drive, Kileleshwa, Kilimani, Thompson and Woodley and zone 5 that has Upper Spring Valley, Kyuna, Loresho and Lavington.

As Nairobi’s population keeps rising the county government has already mapped out the colonial-era estates of Uhuru, Jeevanjee, Old Ngara, Pangani and Ngong Road estates for demolition. The houses will give way to high-rise apartments.

Nairobi’s population has grown by over a million people since 2009 to hit 4.04 million in 2014, according to data by Kenya National Bureau of Statistics underlining the inevitable shift in the type of houses.

Demolition of the dilapidated and rundown estates is part of the county’s plans to build 100,000 affordable units for slightly more than 600,000 city residents.

Amid the apartments craze, credit crunch occasioned by the capping of interest earned on commercial loans since 2016 has hurt the ability of Kenyans to rent and purchase the space.

Mr Denge says that while the middle class has the most appetite for apartment units, a majority are left out because they cannot access loans to purchase the property. The opportunity is passing them by even as house continue to fall.

Data by Kenya Bankers Association (KBA) shows that the prices of houses fell by 2.78 percent- the fastest in five years on the back of the credit crunch.

“The cautionary stance of households in view of prevailing economic circumstances, tight credit conditions and squeezed household budgets continued to exert a glut on housing market,” KBA CEO Habil Olaka said in May.

With multinationals hosted in Upper Hill, Westlands and Kilimanireal estate investors have shifted to mixed-use facilities with an emphasis on adding shopping facilities within the residences.

Kilimani, Parklands and Westlands that were in the top five in the number of approvals for residential apartments last year coincidentally have the biggest space for offices in the capital.

Reports by Cytonn show that Kilimani accounts for 16.5 percent of the office space available in the capital followed by Westlands at 17.5 percent.

Mombasa Road that is bordered by South B and South C either side has 14.1 percent of the total office space while Parklands accounts for7.6 percent.


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