Sameer builds warehouse in real estate expansion drive
From Left; Managing Director of Sameer Africa John Mugo, Directors Akif Butt, Mary Ngatia, Sameer Merali, Chairman Eng Erastus Mwongera, Dr Lydia Mbuthia and Peter Gitonga during the Infill project ground breaking event for a 260 Million Purpose Built Industrial Warehouse held on November 28, 2023 at Sameer Africa PLC Head office in Nairobi. PHOTO | BILLY OGADA | NMG
Sameer Africa has launched construction of a new Sh260 million industrial warehouse within its Nairobi complex as part of its expansion in the real estate business, which is its most profitable division.
The facility is slated to start operations by mid next year and is equipped with new technologies to increase efficiency.
“This facility has been crafted to align with our tenant’s distinct needs, encompassing considerations in size, layout, features and functionality,” said Mr John Mugo, the managing director of Sameer Africa.
The company’s rental business is its most profitable unit, mitigating losses from tyre distribution. Sameer reported a net profit of Sh24.2 million in the half year ended June, down from Sh67.6 million a year earlier.
Sameer says the property situated along Mombasa Road includes 15MVA of installed electricity power capacity, high-speed fibre connectivity, ample utility water and a dedicated in-house property management team ensuring seamless operations.
Mr Mugo says the company’s decision to venture into industrial warehousing is due to the rising demand for storage facilities in the country attributed to the rise of e-commerce since onset of Covid-19 pandemic.
The segment’s growth is driven by increased international trade volumes, the influx of international players, and a growing consumer market.
“In a landscape riddled with supply chain disruptions and soaring real estate costs, businesses clamour for a proficient team capable of delivering flexible, purpose-built facilities tailored to their operational uniqueness,” said Mr Mugo.
“Modern warehousing like the one under construction is poised to empower businesses to achieve unprecedented operational efficiencies, enhancing profit margins and facilitating sustainable growth by reducing or offsetting carbon emissions.”
The groundbreaking is the second phase of Sameer’s strategy to reshape the company’s property business into a major source of income and growth.
The first phase involved the renovating and upgrading of the firm’s existing properties and securing 100 percent tenant retention.
Sameer aims to attract long-term preconstruction lease agreements and enjoy predictable rental revenues from the facility. The company provides over 750,000 square feet of lettable warehouse space.
Sameer closed some branches and tyre centres in Kenya and the region in February 2020. In addition, the Group did not register any revenue from regional subsidiaries in 2022, and the Company has taken a full impairment of the investments in the subsidiaries and Yana Tyre Centre. The Company is however still in the business of tyre trading and property letting.
