CAPE TOWN // Amid Africa’s many regions of upheaval, there are oases of calm appearing for some of the more better-off residents.
“Lifestyle estates” are going up across Africa, proving wildly popular with the continent’s expanding middle class.
In a similar vein to the UAE’s communal property projects, these developments provide an environment that is equal to, or exceeds what is found in many western countries. They become islands of security and modern comfort in cities where infrastructure is often lacking.
“The fast growing middle class in African countries is rapidly gaining access to services and products across different sectors,” says Sebastian Dietzold, the managing director of Fumba Town Development on the island of Zanzibar, a Tanzanian archipelago off the coast of east Africa. “They, too, are evolving to fit modern lifestyle whether its phones, cars, housing and so on and demand to pursue comfort, safe, clean and healthy environment for their families.”
Fumba is just one of dozens of such projects going up around sub-Saharan Africa. It will initially provide 1,000 residential units of apartments, town houses and seafront units but will eventually also have a commercial and entertainment area open to the public.
Mr Dietzold says Zanzibar’s population will double in the next decade, driven largely by expanding tourism that is causing a rise in the number of leisure industry professionals. These are a mix of expatriates and locals who want to come home at night to modern amenities.
“Fumba Town Development is the first gated community in Zanzibar, which will set trends to the inherited lifestyle of expats settling on the island. We expect this will encourage other developers as well,” he says.
Africa’s property markets are continuing to develop, despite recent challenges faced by some of its commodity-driven economies, according to Knight Frank’s Africa Report 2017 released on Wednesday. However, a divergence between the growth rates of commodity-exporting and commodity-importing countries has created wide variations in the strength of occupier and investor activity across the continent, the property consultancy says.
Africa’s strongest economies over the last two years have included commodity-importing east African countries Tanzania, Ethiopia, Kenya and Rwanda, while the west African economies of Côte d’Ivoire and Senegal have also emerged as star performers, Knight Frank says.
A growing volume of capital is targeted at Sub-Saharan Africa real estate investment and development, with a series of new investment vehicles being launched in recent years, according to the broker. South African funds are increasingly prominent as they seek to diversify away from their domestic market.
Rapid population growth and urbanisation are key drivers of property market activity across Sub-Saharan Africa, the report says. Its population is growing at a faster rate than that of any other global region and its demographic profile is both young and increasingly urbanised, creating opportunities for real estate development to support this growth.
All the signs point to a growth in gated communities. A recent survey by the research firm Mercer, which produces an annual Quality of Living index, showed only five African cities made it on to the top 100 list, which is dominated by European locales. Port Louis in Mauritius is the highest and clocks in at 84, followed by four South African cities also making the top 100.
Dubai, incidentally, takes the 74th spot on the index, with Abu Dhabi at 79.
Mercer says infrastructure is pivotal in determining the quality of living for expats in cities, which explains why African countries lag far down the ranks. Lifestyle estates leapfrog this – for the middle classes and wealthy, that is.
The security they provide their residents is clearly a factor in their appeal, especially as the middle classes grow older.
“There is a rise in demand for retirement estates especially,” notes Andrew Amoils, the head of research at New World Wealth, a Johannesburg-based firm that collates data on the emerging moneyed class in developing countries.
The concept of shipping off the elderly to a home is virtually unknown across most of Africa, where families tend to the needs of the aged themselves. With urbanisation though, this ancient tradition is under threat. In addition, according to the World Health Organisation, the number of people living past the age of 60 in African countries will double in the next 35 years.
The changing demographics and increasing wealth is helping to drive interest in lifestyle estates all over the continent. In Nigeria work is about to begin on the Garden City Golf Estate at Port Harcourt, with a planned 750 units that will sell for up to 66 million naira (Dh788,332) for a four bedroom villa, and 27m naira for an entry level 1 bedroom loft.
On Africa’s east coast, the Greenpark gated community near the Kenyan capital Nairobi is selling houses from around 14m shillings (Dh500,201), one of dozens of such developments in the country.
While golf estates have been especially popular, other themes are also being adopted, Mr Amoils says. “Wildlife estates are on the rise. Overall, there is move away from traditional golf estates.” Instead of greens, these use natural vegetation and bring in antelope and other small animals to roam freely among the units.
On all the continent, South Africa remains the leader in gated living. Around 318,000 residential properties are within secured communities, according to research by the Johannesburg property firm Lightstone. The combined value of these communities is around 643 billion rand (Dh185.33bn). Units also sell for a premium, on average 2m rand a property, nearly three times the national average of 700,000 rand per home.
And with the present chaotic political and economic situation under the president Jacob Zuma that saw South Africa’s credit rating downgraded to junk status by S&P on Monday following a cabinet reshuffle that has surrounded the leader with yes men, a safe place to live is a primary driver of demand.
“It’s firstly the whole security aspect of it,” says Anne Porter, the chief executive of Knight Frank South Africa. “And it’s not just here. We are seeing these developments springing up all over the world including the US, especially in states such as Florida. People want to live in an environment where they feel safe from outside threats.”
As the trend to lifestyle estates is relatively new in Africa, it also means developments have all the latest mod-cons such as open-plan kitchens and fibre optic broadband. “The traditional suburban house with a separate dining room is falling out of fashion – consumers want combined dining and cooking areas now.”
In South Africa, Cape Town itself has a unique hurdle when it comes to developing lifestyle communities; its famous and large Table Mountain, which while a city landmark, is sitting right where people most want to live. The mountain is a reserve with no development allowed, so property must squeeze in, around and up close to find room.
The most expensive stretch of real estate is the Atlantic seaboard, where mini-mansions cling to the rock like mussels. Table Mountain forces developers to use as small a footprint as possible.
Lifestyle communities are popping up, Ms Porter says. “Apartment buildings are being built with gyms, swimming pools and clubhouses.” Older buildings dating back to the early 20th century are being gutted and remodelled. This naturally raises a downside – a city that is rapidly becoming unaffordable to lower income residents. Residents grumble it is following the path of London, where working class areas are becoming gentrified and locals priced out.
“It is a consequence of development that gentrification happens and is a burden on the poor,” Ms Porter says.
“This is also, though, how cities evolve.”
Whether that evolution is going to be hampered by South Africa’s volatile economic situation only time will tell.
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