Economy

Where Kenya’s super-rich are acquiring new homes

TEA-FARM

A tea plantation in Tigoni, Limuru. FILE PHOTO | NMG

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Summary

  • Knight Frank in its latest wealth report reckons that the need for privacy, more outdoor space and relatively lower prices has made the two locations attractive.
  • Traditionally high-end addresses like Kileleshwa, Kitisuru and Runda in Nairobi are becoming less attractive on fears of congestions.
  • The super-rich are also fleeing congested cities to their second homes in other countries and localities in search of safe havens and more space, with the coronavirus more likely to spread among people living in close quarters.

Tigoni in Kiambu and Miotoni in Karen, Nairobi are emerging as the most sought-after neighbourhoods among Kenya’s super-rich, a new wealth report reveals.

Knight Frank in its latest wealth report reckons that the need for privacy, more outdoor space and relatively lower prices has made the two locations attractive.

Traditionally high-end addresses like Kileleshwa, Kitisuru and Runda in Nairobi are becoming less attractive on fears of congestions.

The super-rich are also fleeing congested cities to their second homes in other countries and localities in search of safe havens and more space, with the coronavirus more likely to spread among people living in close quarters.

Knight Frank says purchasing decisions are driven mainly by the rich who have been set free from the daily commute to offices as working from home takes root, lower prices in the areas with potential for growth, clients looking for homes with spacious outdoors and the resilience in the market.

“Despite the turmoil, new opportunities are emerging as the way we live, work, exercise and interact is changing. Travel restrictions may be clipping the wings of prime buyers but with fewer people tethered to an office, this is likely to change with knock-on effects for second-home markets and investors globally,” the report notes.

Miotoni is an exclusive residential area in Karen where the price of a five-bedroom villa starts from Sh110 million.

In other sections of the rich neighbourhood, a villa on a half an acre can attract up to Sh300 million.

Maggie Macharia, a property consultant at Pam Golding, said that currently they are selling half an acre in Miotoni for between Sh40 million and Sh45 million.

The prices depend on connection to key services such as power, water and sewer.

An old fashioned bungalow on half an acre is Sh65 million while old massionetes and villas on the same size of land start from Sh85 million. Ms Macharia said a modern villa gives developers Sh130 million upwards.

In Tigoni, an acre of land fetches between Sh36 million and Sh80 million depending on accessibility. “We currently do not have property in Tigoni, but on average half-acre land goes for between Sh18 million and Sh40 million and this depends on proximity to things like roads,” says Ms Macharia.

Tigoni is a small town in Limuru, 30km from Nairobi. The town was developed by white farmers who resided in Limuru during the colonial era.

The Knight Frank report has put Tigoni and Miotoni in the list of 40 hotspots in the world to watch for real estate investments targeting the wealthy.

The latest instalment of the Knight Frank Wealth Report places the number of Kenyans with a net worth of at least $30 million (Sh3.3 billion), including their primary residence, at 90 last year. Their ranks shrank from 106 in 2019, but are expected to expand to 110 by 2025.

Africa’s rich have suffered the most from the economic impact of the pandemic, with 88 percent of the continent’s wealthy who participated in the survey saying it remains their biggest worry in the short term.

Kenya had the fourth highest concentration of wealthy persons with a net worth in excess of Sh3 billion in Africa among the countries captured by the Wealth Report.

Nigeria led the pack with 867 ultra-rich persons followed by South Africa (742) and Egypt (583).

Kenya’s club of high-net-worth individuals, defined as those with at least $1 million (Sh109 million) including their primary residence, dropped by an even larger margin.

The report says that 912 Kenyans fell out of this club last year when their numbers stood at 3,323 compared to 4,235 in 2019.

The bigger decline in this category shows the impact of the pandemic on small and medium-sized firms and the professional class who constitute the membership of the emerging rich.