Invest in Retail Property | Goodreturns from investing in retail real estate

Invest in Retail Property in Africa

Retail real estate was one of the more obvious victims of the Covid-19 pandemic, making many reluctant to invest in retail property in Africa. The opportunities for high-return investments from bespoke turnkey developments still exist though due to the largely untapped potential for these types of projects in Africa.

The success of retail real estate in many African countries is underpinned by high levels of inbound tourism. The pandemic significantly impacted retailers’ revenues, particularly in non-food-based businesses. With global travel normalising, retail real estate is bouncing back, making it attractive to invest in retail property once more.

Despite the boom in online shopping making e-commerce a reality that retailers must adapt to, African retail property is slowly returning to normalcy. In the face of vacant spaces in retail developments, shifts to working-from-home, increased inflation, rising unemployment, and the continuing devaluation of local currencies, the retail property market started recovering in 2022 and a better year in 2023 is anticipated.

The second factor sustaining the African retail real estate sector, and providing opportunities to invest in retail property, is the continued rapid growth in population and urbanization. While this obviously drives the need for residential developments, retail space is required by cash-generating businesses supporting the growing pool of consumers.

Invest in Retail Property – Top African Opportunities

South Africa, Nigeria, and Egypt are predicted to see the most significant increase in consumer spending inthe future. Angola, Ethiopia, Ghana, Kenya, and Morocco are also expected to offer attractive opportunities to invest in retail property.

Kenya is viewed as one of the African countries where real estate offers the potential for higher rates of return than other, non-African, investment destinations.

According to the World Bank Population Growth Data, Kenya’s population of 54 million is growing at 2.3% per annum, significantly faster than the global average of 1.0% per annum. This positively impacts the real estate market, driving the demand for housing, and especially rental property. The trend for commercial tenants to select buildings that meet ESG (Environmental, Social, and Governance) requirements, is projected to continue into 2023.

Kenya is viewed as one of Africa’s best-performing markets for real estate investments, including opportunities to invest in retail property.

High Returns and Low Risk from an Industry-Recognized Developer

Greg Pearson and Bronwyn Knight, the founding members of Grit Real Estate Investment Group (Grit), were the first to recognize this possibility in 2014. (Grit). Grit has grown to be the largest pan-African real estate income group listed on the main market of the London Stock Exchange, the Johannesburg Stock Exchange, and the Stock Exchange of Mauritius thanks to a significant portfolio of world-class developments in key African countries. Now operating across seven countries, Grit has direct investments in five asset classes and 25 assets with a combined market value of almost USD800 million.

With Grit not being mandated to take on development risk, the founders of Grit established Gateway Real Estate Africa (GREA) to address the demand from multinational companies for quality real estate solutions on the African continent. The limited number of experienced developers who were able to fulfil this requirement provided an opportunity to deliver class-leading turn-key construction solutions in Africa.

GREA  has a well-established track record of delivering world-class construction solutions in Africa, including opportunities to invest in retail property. We consistently provide multinational clients with high-yielding, US-dollar-denominated, rental income streams. We will unlock the potential of African real estate for select investors. To participate in the African opportunity, contact us today.

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