NAIROBI (Xinhua) --
A shopping mall, a pre-unit school, office block
and a recreational centre are the facilities Joseph Ombogo can
access in a few minutes if he walks from his apartment located
on the south of Nairobi, Kenya’s capital.
developer moved into the estate recently after buying the
three-bedroom apartment on mortgage and he totally loves the
“If I stretch my
left hand, I am in the mall and the right at the school. And if
I lift my left leg, I will be in the office and the right in the
pub. That is how easy life has become,” he quipped on Sunday.
Ombogo, who works
with a software company in Nairobi, plans to enrol his youngest
child at the school in January and open his firm at the office
block as he readies to go into private employment.
“Since I moved here
seven months ago, the idea of working near home has nagged me
more often. I don’t think I am ready to struggle with traffic
jams anymore while driving to Westlands, every day, not when I
am living in such an environment where everything is at one
place,” he said.
Ombogo is among a
growing number of Nairobi residents living in estates where
houses, shopping malls, office blocks and recreation facilities,
among others, are all under one roof.
An increasing number
of property developers in the east African nation have embraced
the projects, therefore, integrating residential, commercial,
hospitality and retail aspects of life at the same place as they
maximize land use.
The projects, dubbed
mixed-use developments (MUD), have helped to create a life,
work, play and invest environment for residents as it boosts
uptake of constructed units.
The MUDs are taking
over the east African nation’s real estate sector amid shrinking
demand for office space and rising prices of houses.
Anthony Kuyo, a real
estate consultant with Avent Properties in Nairobi, noted that
even small developers are going for MUDs.
“In the suburbs, you
will not find residential areas alongside big malls but you will
get a five storey building with ground and first floors occupied
by shops and the upper floors being houses. This helps the
developers to get commercial and residential tenants,” said Kuyo.
Nairobi-based investment firm, observed that there is the
emergence in Kenya’s real estate sector of large-scale
integrated mixed-use developments, composed of extensive retail
malls, grades A office spaces, residential areas with apartments
and villas, restaurants, hotel rooms and serviced apartments.
In the capital
Nairobi, recent MUDs include Garden City along the Thika Super
Highway, Two Rivers along Limuru Road, Le Mac in Westlands,
NextGen along Mombasa Road, Greenspan on the east of Nairobi and
Crystal Rivers in Athi River.
popularity of mixed-use developments is mainly driven by higher
returns since MUDs perform better, recording an average rental
yield of 8.5 percent compared to a market average of 7.5 percent
for single-themed developments,” said Cytonn.
The MUDs also
enhance operational synergies whereby one sector’s performance,
for instance, residential complements the others.
creates a ready market for retail services while firms occupying
office space are potential clients for hotel, restaurant and
conferencing space. As a result, improvement of performance of
one theme leads to better performance in other,” said Cytonn.
While more investors
are going for the buildings, Kuyo noted that disadvantages
include congestion and lack of market in case more than one
developer builds the structures in the same area.
“On the east of
Nairobi, three malls are in the vicinity of each other having
been constructed with residential areas. The shops in some of
the malls remain unoccupied, including a supermarket hall,
because the customers’ catchment area is the same. The
developers simply cannibalized each other,” he said.