Property Flash


Property Flash sat down with Somaya Joshua, an experienced real estate banker across the African continent. We wanted to assess what challenges commercial real estate professionals and markets are facing in 2022 and how skilled and patient investors can thrive as we go deeper into the 2020s.

Property Flash: Thank you for joining us. You must be thrilled that this year’s API Summit will be in person again after it was forced to be online only during the pandemic.

Somaya Joshua: The API Summit is a key calendar event providing a platform for industry players to connect and, importantly now, to reconnect. As a bank, we are looking forward to attending and contributing to the success of the event and explore growth opportunities, gain new perspectives, engage in conversations on how to improve the property sector and add value for our clients

Property Flash: What is the biggest challenge to financing commercial property deals in Africa?

Somaya Joshua: Regional stability, access to capital on a long-term basis and data.

A key risk mitigator on property assets is gearing (loan-to-value) and the right mix of debt to equity as we structure bespoke funding solutions for our clients and optimize their capital structures.

This links into the availability of data that informs valuations and the consistency in the valuation methodologies adopted in our various markets.

Property Flash: Is residential the biggest part of Africa’s property pipeline?

Somaya Joshua: It should be biggest contributor to our pipeline but it’s not there yet. We have a growing population, rapid urbanisation – creating demand for good housing – and a growing middle class. All of this points to a play on housing, more specifically Affordable Housing. We’re not seeing a pipeline that correlates to this. It is often structurally complex for banks to participate in funding structures where equity is drip-fed as buyers make incremental payments to developers to settle end-user purchase prices in full. We need a structurally supportive operating environment that supports the production of quality stock in response to the pent-up demand for housing at affordable price points.

We remain optimistic about the market potential offered in commercial property. There are new and notable plays in some of our markets, including asset classes like light industrial warehouses, affordable housing, student accommodation, corporate accommodation and embassy housing.

Property Flash: Is Africa rising again?

Somaya Joshua: Momentum has continued. To give you an example that’s close to home, Absa had continued to fund the sector, growing our market share, supporting our existing clients and acquiring new clients despite the headwinds experienced as a result of the pandemic

Property Flash: How does the conflict in Ukraine affect your job?

Somaya Joshua: Real estate lags the real economy, but the immediate impact has manifested in various forms like FX liquidity and inflation impacting the cost of debt and ultimately the quantum of debt that property cashflows can afford on a ring-fenced basis.

An advertorial for AP Summit

Somaya Joshua Absa Group Head: Real Estate Finance will speak at the Africa Property Investment (API) Summit 2022 which will take place from September 21 to 22 at The Marriott Hotel in Melrose Arch, Johannesburg. The API Summit is the premier real estate investment conference on the continent and is a valuable opportunity for people keen to network and collaborate in an effort to take African real estate forward. For more information and to register to attend this year’s event, visit:

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