Nairobi’s expanding Runda suburb has been named among the global real estate hotspots most likely to attract dollar millionaires keen to buy property in 2017.
The Knight Frank Wealth Report 2017 says that while the estate has been expanding northwards beyond the Northern Bypass, it is retaining value with expatriates still willing to pay a premium on housing units.
The area is therefore poised to outperform similar developments in other African cities due to improved transport infrastructure and gated compounds, which are well served by facilities including top schools, recreation and sports facilities.
“The influential residents’ association in the traditionally high end suburb of Runda works hard to ensure that new developments are in keeping with the character of the area, which was first developed in the 1970s to house United Nations staff.
However, there is a scarcity of plots and development opportunities, leaving buyers with limited options,” said Knight Frank Kenya managing director Ben Woodhams.
“The Northern Bypass has now opened up the area North of Runda, leading to the sudden and rapid expansion of the suburb into the surrounding coffee fields.
"The diplomatic community is already leasing accommodation beyond Runda in new developments such as Eden Ville, Four-Ways Junction and Five Star Meadows.”
Mr Woodhams said transport and infrastructure upgrade of the area had boosted the region and opened it for luxury residential developments.
Ultra wealthy individuals
The Ultra Wealthy High Net Individuals (UNHWI), according to the report, are also likely to aspire to live in the area due to the calibre of development with high-end amenities coming up.
The UNHWI in Kenya today number 9,400, representing an eight per cent growth from 2015’s total of 8,500.
These dollar millionaires are individuals with assets worth more than Sh102 million ($1 million at current exchange rates) excluding primary assets such as homes.
The prices of land and rental charges in outlying areas of Nairobi has been growing steadily over the years, driven by a growing population coupled with rising incomes and improved transport infrastructure, which has eased access.
Other top global locations that Knight Frank projects will attract the super-rich include East Guanggu (China), Dubai South, South Main (Vancouver), Randwick (Sydney), Lower East Side (Manhattan) West Aspen (US), Santo Spirit and Porta Romana (Florence, Italy), Centro (Madrid) and Quarter Des Paquis (Geneva).
Property management firm HassConsult reported in its fourth quarter 2016 property index that there has been strong demand for houses in exclusive suburbs such as Runda, Muthaiga and Kitisuru that are less built up over suburbs that have high-density developments, in spite of the housing sector slowing down due to a sluggish economy.
“Most of these suburbs are exclusively high end and just like other markets globally, high end areas tend to be least affected in a sluggish economy whereas the areas with middle market properties, which in Kenya constitute property in the satellite areas generally witness a marked slowdown,” said HassConsult head of research and marketing Sakina Hassanali.