Property financiers, developers and managers believe that Africa’s time is now here.
Cheick Sanankoua, managing partner at HC Capital Properties explains that his career, especially across west Africa, has enforced the idea that investors of a broad range of sizes recognise that real estate offers long-term investment returns.
HC Capital Properties is a London and Abidjan-based developer with an impressive track record, especially in the western African region. Sanankoua who will present at the Africa Property Investment (API) Summit, recently spoke to Property Flash about how one can be successful in African real estate, through keen preparation, and also about the future of property, on a continent where people are largely young and becoming more upwardly mobile daily.
“There are so many opportunities on the continent, including housing, and logistics warehouses as mobile penetration and online shopping explode, and also offices for global companies expanding their operations. Bricks and mortar retail centres are also offering development opportunities,” says Sanankoua.
With the youngest population of any continent, Africa is on the agenda of big business and governments.
As the world opens up, investors are getting more and more choice across the world. Africa offers markets with large populations and a welcoming response to new developments, even if accompanying infrastructure, which may be lacking, has to be built along the way.
Financial institutions have cut their teeth in varied geographies, learning what is most effective in each country, and what could be highly costly errors.
Sanankoua explains that investors have learned the importance of preparing before investing millions of dollars anywhere in the world, including in Africa.
“For a start, you need to pick the correct partner on the ground. The pandemic forced many businesses at least to try to operate remotely. Some professionals thrived but some businesses struggled and some closed shop altogether. Your partner in an African market needs to be in that market and to be able to access the right people, development sites and organisations quickly and at a low cost,” he says.
“Investing in Africa showed that you need people you can trust on the ground. These may be legal and tax experts or even people who are close to authorities. Bear in mind that in many African countries, families own and control significant portions of real estate,” he says.
“They may attach prices to their properties which are not market-related and are actually overly emotional and optimistic. But these families are sometimes the largest landlords in a specific market and therefore have a captive market,” he says.
African markets are dynamic and often changing. Investing in African real estate, especially from a development point of view, is a game of calculated patience. This is true of many markets, not just of burgeoning Africa. You need to be patient with your partners but also not to throw cash at services and projects which may just eat through your money.
There have been many recent successes across key markets.
Sanankoua explains that the likes of Standard Bank financed the impressive, world-class Stanbic Heights office building in Ghana. African real estate is often world-class and the envy of developers abroad.
Grit Real Estate Income Group, the pan-African Reit has also enjoyed huge success in Africa. It took about a decade for CEO Bronwyn Knight to develop the company with her team but the group is now soaring.
It was initially Delta Africa, then Delta International, then Mara Delta and eventually Grit. It is now listed on the London Stock Exchange and has assets in eight African countries, including Mozambique, Mauritius, Zambia, Morocco, Ghana, Kenya, Botswana and Senegal; quite a feat for what was a little company in Africa at one stage.
Other listed funds such as Resilient Reit, Hyprop Investments and Redefine Properties, have had exposure to Africa before and funds are often looking for opportunities on the continent
This is an enticing continent which is making a statement for the world.
“The API Summit is an exciting opportunity for more like minded investors, developers, market analysts and others to collaborate and ensure that African real estate thrives,” says Sanankoua.
Advertorial for API Summit
The API Summit 2022 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 expected to attract hundreds of guests as they look to network and collaborate in an effort to take African real estate forward. Property Flash is API’s media partner. Register to attend this year’s API event at apisummit.co.za