Kenya’s real estate sector up in global transparency listing
Kenya’s booming property market remains one of the less transparent globally although it has managed to make some gains over the last three years. FILE PHOTO
What you need to know:
The improvement is courtesy of effort by private and public sector that have raised the quality of data in the real-estate sector.
Government-led initiatives that have helped improve the score include the introduction of laws guiding Real Estate Investment Trusts (REITs) and the digitisation of the lands registry.
Countries are grouped into highly transparent, transparent, semi-transparent, low transparency and opaque.
Kenya’s booming property market has managed to make some gains in transparency over the last three years.
A report by Chicago-based financial and real estate consultancy Jones Lang LaSalle ranks Kenya at position 55, an improvement from last year’s position 67.
The index places Kenya in the semi-transparent category. Countries are grouped into highly transparent, transparent, semi-transparent, low transparency and opaque.
According to the study, the improvement is courtesy of effort by private and public sector that have raised the quality of data in the real-estate sector.
“The strength of market fundamentals data has also started to improve as private companies are beginning to collect real-estate data in a systematic way. There is growing evidence of published property market research and analysis, with the increased entry of international real-estate advisers bringing improvements in data availability, consistency and collection,” it says.
The sector turns over billions daily with little to benchmark the buys and sells. Mentor Management Group released the first report on commercial office market last February while South African property management firm Broll expanded to Kenya’s property market in late 2013.
In Africa, 2014 Global Real Estate Transparency Index places Kenya behind South Africa which is at position 20 and Mauritius (21) but is still ahead of Zambia (63), Uganda (82), Ghana (83), Nigeria (86), Mozambique (88), Angola (95), Ethiopia (98) and Senegal (101).
The report said infrastructure spending in Kenya, Ghana and Nigeria has helped improve the markets.
“The improvement in transparency in these markets is an outcome of concrete efforts taken by the respective countries to upgrade their physical infrastructure, and to improve governance and the regulatory framework to create a business-friendly environment,” said that report.
Despite the optimism expressed by Jones Lang Lasalle, other property managers rubbished the findings saying transparency was still down.
A property manager who declined to be named said that the findings are misleading.
The World Bank has said that the digitisation of land records has lost steam which is affecting the country’s competitiveness.
Processing titles is also in limbo due to the supremacy wars between Lands secretary Charity Ngilu and the National Lands Commission (NLC) over powers to process grants and leases.
Ms Ngilu has been seeking powers to process the titles without involving the commission and has gone ahead to gazette laws that grant the Chief Lands Registrar powers to process the documents.
Queries have also been raised on the cancellation of titles in Lamu that had been issued to 22 companies.
President Kenyatta directed the revocation of the title deeds covering some 500,000 acres but the Kenya Land Alliance, an NGO, said it was only the NLC that had powers to revoke titles.
