New office block raises profile of Changamwe as shipping centre

A property developer has planned a multi-million shilling office block in Changamwe, raising the profile of the town as a commercial centre.

Myspace Property Ltd will build 60 offices in a five-storey building, which will house leading shipping line agents, clearing and forwarding agents, cargo consolidators, transporters and banks, the firm’s managing director, Mwenda Thuranira said.

The block on a two- acre plot will have a parking yard and will be the first office building in the region to accommodate shipping industry investors in one place.

The construction of the office block to be located at Kibarani starts in August this year.

Property developers are shifting focus to Changamwe following congestion in Mombasa town pushing them to areas that have expansive land.

“Mombasa Island is already congested and cannot handle any huge demand for new offices,” Mr Thuranira said.

Market analysts say the ongoing planned expansion at the port of Mombasa and the construction of the Dongo Kundu bypass planned to start early next year will significantly dictate development in Changamwe area in the coming years.

The region’s fortune as a commercial hub started in 2007 when residential houses paved the way for the Container Freight Stations (CFSs) established to address congestion at the Mombasa port.

Shipping industry

Today, there are more that 15 licensed CFSs in the region. To construct a CFS, one requires a huge piece of land that can stretch as much as over 10 acres. The increase in number of CFSs has also attracted investors to construct parking yards near the freight stations.

The new office block will be located only five minutes drive from Mombasa port and is funded by I&M Bank to a tune of Sh1 billion, Mr Thuranira said.

“We are targeting people in the shipping industry. The growth in the industry is so enormous and enough to make Changamwe a new major shipping centre,” he said.

The proposed Dongo Kundu bypass will start near Miritini, about 10 kilometres away from Mombasa Island, West of Moi International Airport, on the central mainland and will connect to the South mainland along Likoni- Diani road.

The bypass, approximately 17.5 kilometres long, will significantly influence development projects in Changamwe due to its importance to the port.

It will connect with the new container terminal at Port Reitz at Mombasa port, whose construction is planned to start in two months time.

Road expansion plans have increased demand for land past Miritini with prices to Mazeras area having more than doubled.
Land in the area has risen to between Sh15 million to Sh30 million per acre. The bypass is expected to be completed before 2014.

All the containers generated by the second container terminal, which has the capacity to handle 1.2 million Twenty Foot Equivalent Units (Teus) will be delivered through the bypass.

The construction of the terminal is expected to start before August this year after the contractor to work on the project was identified in April this year.

The new container terminal will also be connected to the existing terminal with all the containers generated from the port expected to be delivered through the bypass.

Gate 18 is currently used for containerised cargo while gate 10 and 12 are used for conventional cargo and vehicles. Over 1,000 containers are loaded out from the port everyday.

Gate 18 joins the main highway at Changamwe and has been a major cause of traffic jams at Kibarani and Airport road, Benard Osero, the public relations manager at Kenya Ports Authority said.

“With Dongo Kundu bypass in use, the trucks will easily avoid Changamwe circuit by joining the highway at Miritini along Mombasa-Nairobi highway,” Mr Osero said.

Joseph Kirema, an investor in cargo handling logistics and the managing director of Summit Cove Ltd said there is a huge potential of Changamwe coming up as a commercial hub. “Transporters have in the recent past appreciated the need to have parking yards on areas between Miritini and Mazeras,” Mr Kirema said.

Alice Wahome, the managing director of Shikara Apartments, said it was necessary to decongest Mombasa town by creating several business hubs away from the Island and Changamwe has shown the potential of playing this role.

“There are many people living around Miritini who don’t need to come to the Island to transact business. Changamwe has already demonstrated the potential of being the next commercial hub in Mombasa,” Ms Wahome said.

Be convenient

Banks have already started opening up branches in Changamwe to address the growing needs, Commercial Bank of Africa, Imperial Bank and Kenya Women Fund Trust ( KWFT) have all opened new branches in the region.

The Bank of Africa opened Changamwe branch last month.

“Changamwe is Mombasa’s transport hub and positioning ourselves there will be convenient to our customers who will not have to beat congestion to access our services in Mombasa Island,” the managing director Kwame Ahadzi said.

The National Bank of Kenya, which receives tax on behalf of the Kenya Revenue Authority (KRA), is yet to open a branch in Changamwe, where it would conveniently serve the port users.

Mr Thuranira said currently, there are not office blocks to accommodate big banks.

The high demand for commercial buildings in Changamwe has slowed down construction of residential houses as investors move further in areas where land is cheaper.

Due to the increased pressure on land and space in Changamwe, property investors of residential houses have moved to the neighbouring estates of Tudor, Mikindani and Miritini , a move that has pushed up the cost of land and rent.

Investors

Nyali, which is also emerging as a commercial hub, is not strategically located for businesses related to the port due to the distance from the port as well as traffic jam at the Nyali Bridge, giving preference to Changamwe which in near the port.
Efforts to decongest the bridge by construction of another one have been in pipeline for several years.

Coastal region is experiencing a construction boom as investors gear up to gain from the expansion of Mombasa port that will see increase in volume of the business the port will handle.

With the ongoing dredging of the channel and the second container terminal to be completed by 2013, the number of investors in port business will increase significantly.

The expanded port is targeting more transshipment and transit businesses.

The volumes of the cargo handled at the port have grown by over seven per cent every year since 2005 and Kenya Maritime Authority says the industry will create about 400,000 new jobs in the next five years.

Kirema said that although the by pass will significantly affect the businesses of the CFS operators, it will still be necessary to retain some yards for handling empty containers.

“In many times, shipping lines operate on tight schedules and always have limited time especially for loading empty container. It would be possible to have empty boxes depot located 20 kilometres away,” Kirema said.