Nairobi's middle class drives construction surge, with mixed reviews
The demand for housing is high, but without an urban plan or building code, the construction boom could have some negative long-term consequences.
(Page 2 of 2)
Then there’s the stuff that makes a city function. Take the water supply. Some 40 percent of the 450,000 cubic meters supplied to the city each day goes missing, stolen or leaked through poorly-maintained pipes, Mbaruku Vyakweli, director of communications at the Nairobi Water and Sewerage Company, told me.Skip to next paragraph
Latest leader to redefine term limits: Senegal's President Wade
US troops against the LRA? A war worth winning
Congo election aftermath: some possible scenarios to avert crisis
Africa Rising: Carbon credits save Sierra Leone's Gola Rainforest
Eastern Congo braces for election results
Subscribe Today to the Monitor
Or the electricity, hit on too many days by power cuts which stall business and leave home freezers slowly thawing.
Roads? There’s a massive upgrading program going on, which will make it easier for commuters living outside town to avoid jams. For the rest, whose homes are along the single-file lanes bisecting the “leafy suburbs”, gridlock is increasingly a reality, not an over-used phrase to describe a minor jam.
None of this seems to be slowing the pace of construction, however.
Down in Nairobi’s city center this morning, hundreds of property developers and their marketing minions will gather for the launch of a four-day Home Expo, where architects’ models in glass displays will tempt investors and potential owners alike.
The newspapers are littered with colorful advertisements for new two, three, or four bedroom apartments – Villa Maria, Chiluma Apts, Bellcrest Gardens, River Gardens. Prices? An average $201,951.
Where, really, is the money coming from to build and then to buy these places? I’ve heard many answers, the wildest of which is that all these apartments are being funded with ransoms collected by pirates in neighboring Somalia. I’ve done the math. It doesn’t add up.
The more prosaic explanation is that Kenya’s banks, freed from being forced to fund the government, now have money to offer in retail loans to personal account holders. At the same time, the country’s relative stability means its international credit rating has improved, allowing for more borrowing.
Finally, the country’s richest few, and its many living in the diaspora overseas, feel far more confident than in the past to save their money here not abroad, and to plow it into home-grown investments.
All well and good. But we’re talking here, as I said earlier, about the very top of Nairobi’s pyramid. What about the growing millions maybe a generation out of the slums, earning a salary, but a low one, with little history with their banks?
Very recently, there appears there’s been a shift. The demands of this massive market, winning access to mortgages from expanding microfinance institutions, are suddenly being addressed.
They’ll struggle for years to afford the near $200,000 prices of the swanky blocks close to the city center. But out on those highways, the homes beneath those red-roofs paving Masailand could soon be theirs.
Several firms have broken ground on what one architect calls “low cost, high life” developments. For example, Jericho, the Kenyan-Israeli-British team building one of Nairobi’s swankiest shopping and office centers, The Greenhouse, are next focused on Sunset Boulevard.
This is a complex of 2,024 budget apartments out beyond the international airport, where costs range from $24,000 for one bedroom to $48,000 for three.
With improved rail links into the city, and an upgraded road, these plots are increasingly attractive to those yearning to clamber onto the first rung of the home ownership ladder.
Efforts are even being made to "decongest" the slum areas themselves, as international donors plow money into basic apartment blocks, connected to water and power, where rents are – in theory – controlled.
Where all this leaves us, if we peer into the crystal ball of the future, is hard to judge. In a dream world, light rail systems will snake into town, leaving roads clear. New building standards will ensure a greater proportion of new developments are given over to green space, not concrete jungles.
The middle class, still expanding, will have access to value-for-money credit, and will be paying mortgages on their dream homes, light years from the tumbledown shacks in which their grandparents lived.
In reality, the prognosis is bleaker. There’s the risk of the credit boom forcing a burst in the bubble we’re seeing now (some I talk to tell me that won’t happen, though). There could be repossessions, negative equity, thousands forced back down the ladder by several rungs, or thrown off it altogether.
The snail pace of regulatory reform will mean that it will be years, possibly decades, before the construction industry is properly scrutinized. The long-term impact of corners cut now is simply unknown.
And, in the meantime, the cranes keep on turning, the scaffolding keeps on rising, and Nairobi, unsure even of how it will look afterwards, keeps on going under the plastic surgeon’s knife.