Actis funds R190 million development of Nairobi Business Park

Artist renderings of Nairobi Business Park Extension

Actis, a private equity firm has invested R190 million ($22 million USD, Sh1.9 billion) towards second phase development of Nairobi Business Park and construction works have started after the developer broke ground on 16th October 2012.

The first phase of the Nairobi Business Park was put up in 2004, totalling 8,000 square metres of commercial space.

The second phase includes development of six new office blocks to create an additional 15,000 square metres of commercial space for letting. It is planned to be completed by end of 2013.

The development, Actis’ flagship real estate investment in Kenya, sits on the same piece of land as Ngong Racecourse. The land is co-owned by the Association for the Physically Disabled of Kenya (APDK) and the Jockey Club.

Speaking during the ground breaking ceremony Actis Managing Director for East Africa Michael Turner said: “This extension is the latest step in bridging the yawning gap for commercial office space in Nairobi. These new office blocks will combine the latest technology, smart planning and unique design to be among the greenest in their class.”

During his keynote speech at the ground breaking, Vision 2030 Delivery Secretariat Director General Mugo Kibati said the initiative reaffirms Nairobi’s growing status as a regional hub that continues to attract investments, which in turn contributes towards the expansion of the Kenyan economy.

“It is such construction that will see us grow this number (GDP growth) to above 10 percent and ensure that we are on our way to becoming a newly industrialised State by 2030,” he said.

The private equity fund also financed the construction of The Junction mall, also on Ngong Road. The fund is eyeing to reap from an improved road network around Nairobi.

The Southern by-pass is now under construction and will be completed mid-2014 to ease traffic pressure from Ngong Road, which is itself being upgraded into a dual carriageway.

“Kenya is currently undergoing rapid urbanisation and infrastructural development has stimulated activity in real estate and other sectors,” Koome Gikunda, investment principal at Actis, said at a past interview.

“It is also the hub into East Africa region, opening access to a population of over 120 million people – which will need everything from food, housing to workspace,” he said.

According to property services firm Knight Frank, the entry of growing numbers of multinational companies into Africa has boosted demand for high quality office space and attracted international developers to cities such as Lagos and Nairobi.

The expansion of the Nairobi Business Park is one of the two major real estate projects that Actis and Mentor Management are undertaking in Kenya.