SA property firm opens Nairobi office to scout for deals

Broll, a South African-based property management firm, plans to open shop in Nairobi to scout for deals in the booming real estate sector.

The Nairobi office, expected to start operations in August, will focus on managing office blocks and shopping malls.

“Broll Kenya will start with a focus on retail management, facilities management, corporate real estate consultancy and broking, but will expand to offer a full range of property services,” said the firm in a statement.

Broll currently manages a property portfolio across the continent valued at Sh536 billion (60 billion rand).

The company has also signed a deal to jointly manage a $50 million (Sh4.3 billion) property portfolio with the Rwanda Social Security Board.

The South African firm also deals in valuation, advisory, market research, asset management, leasing and sales, and retail consultancy.

Broll said that it would start off alone, but left open the a possibility of partnering with locals.

This option depends on an assessment of the local market, which it says is brightening as more multinationals open offices in Nairobi and consumer purchasing power grows.

“Kenya and Zambia appear to be ahead of the retail development curve compared to other countries and have a number of modern shopping centres,” said the company’s annual report for 2013.

UK-based real estate consultants Jones Lang LaSalle in a report titled Redefining Retail Investment Global Real Estate Futures have said that Kenya’s growing consumer market is attracting South African investors interested in developing shopping malls.

The latest shopping mall in Nairobi, Garden City, whose groundbreaking was done on Wednesday, will be the largest of its kind in the in the region upon completion.

Property managers said that servicing these types of clients requires high level of standards in a market that is short of resources to deliver.

International property management firm Knight Frank managing director Ben Woodhams said that the immediate challenge that would face a new entrant is assuring clients of uninterrupted power and water supply, which are some of the basic requirements.

“We are faced with a lot of challenges especially from utilities and we have had to develop a lot of relationships with service providers over the years,” said Mr Woodhams.
Knight Frank are Garden City’s property managers.

Maintaining these standards has not only seen the company go beyond managing finished properties but also coming on board at the conceptualising stage, he added.

Property managers typically make revenues from a portion of the service charge per square metre that tenants pay.