Britam bets Sh12bn on Nairobi shopping mall despite glut fears

Britam Holdings chief executive Benson Wairegi.
Britam Holdings chief executive Benson Wairegi. PHOTO/FILE
Britam Holdings is setting up a Sh12 billion mall in Nairobi’s Kileleshwa estate, shrugging off fears of a looming glut of retail space.

The firm has disclosed to its shareholders that it will build a 140,000 square feet shopping centre in Kileleshwa to meet the rising demand for high quality retail space in the upmarket estates of Nairobi.

Britam Holdings chief executive Benson Wairegi told investors at the company’s Annual General Meeting last month that it was pursuing property management as its core business following the creation of a real estate subsidiary – Britam Properties (Kenya) Limited – to push new deals.

“We want to build a mall because there is pent up demand in Kileleshwa and there are no malls in that proximity,” Mr Wairegi said.

“The mixed-use development includes offices, serviced apartments and a hotel – all valued at approximately Sh12 billion, including land.”

Britam Holdings, which has interests in insurance, asset management and property management, says it has acquired land worth Sh10 billion to facilitate its property development initiatives.

READ: Britam Holdings is making bold bets on Kenya’s real estate

The company that recently sold a 10.3 per cent stake to the International Finance Corporation (IFC) for Sh3.5 billion is currently leasing space at its 32-storey flagship building – Britam Towers – in Upper Hill, Nairobi.

The imposing skyscraper, which rises 195 metres above the ground, became the third tallest office building in Africa when it opened doors to members of the public earlier this year.

Britam has embarked on construction of 11 floors of fully furnished and serviced apartments in Nairobi’s Kilimani, as it seeks to cash in on the rising demand for non-hotel based accommodation among business tourists visiting the city.

The project, which will be built a cost of Sh3.3 billion, comprises 117 two-bedroom and 46 one-bedroom rental apartments located on a 1.6 acre piece of land on Nyangumi Road in Kilimani.

The project is being undertaken by Britam Properties, a subsidiary of Britam, and it is earmarked for completion in 2020.

At Sh12,000 to Sh20,000 for a two-bedroom unit and Sh8,000 to Sh12,000 for a one-bedroom unit a night, the development looks quite promising considering that Nairobi is positioning itself as the regional business hub.

READ: Wealthy builders shrug off Nairobi office glut fears

Mr Wairegi said the company’s decision to venture into property development is part of its diversification strategy meant to lower portfolio risk and exposure to the stock market.

“The market will need at least 1,000 serviced apartments in the next three years and Britam Properties will help in bridging this gap,” he told guests who attended the project’s ground breaking ceremony last month.

Britam Holdings, which has interests in insurance, asset management and property management, says it has acquired land worth Sh10 billion to facilitate its property development initiatives.

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