Smart investment in Real Estate in Kenya for the middle class.

IN Kenya, most real estate investment for apartments is usually done by the high class and upper middle class. This is the class that can afford to construct apartments which cost on average between kes 20 million to kes 50 million for a block of flats sitting on a 1/8th acre of land within 30km radius of Nairobi CBD. These are areas sucha sKitengela, Kiambu, Syokimau, Kikuyu, Ngong, Kiserian ,Ruai, Thika and Nairobi eastlands.

Due to the high cost of middle class  apartment construction, most Nairobians tend to rent from the developers, mostly upper middle class and high class income groups.

 

Smart solution.

A4architect.com has come up with smart solutions to enable the middle class to live comfortably within these Nairobi Surburbs.

Nairobi CBD is the main source of employment for the middle class. This means they cant be able to live in far off places such as Kajiado, Isinya, Limuru, Naivasha,Muranga, Kangundo where land is around kes 500,000 per 1/8th acre, hence affordable.

This leaves them at the mercy of the high class Kenyans able to buy land and construct apartments in nearer areas such as Kiambu, Kitengela, Umoja/Eastalands and Ruai.

The solution lies in the middle class buying into a4architect.com’s real estate investment option for the hotel project along Southern Bypass in Thogoto.

The hotel has 30 rooms whereby the initial sale price has been set at kes 1.2m per room whcih will continue increasing as demand rises.

Assuming an investor buys in at the initial stages where the sale price is kes 1.2m, they will gain an average of kes 18,000 per month, assuming the hotel room they have bought brings in kes 1,000 per night for 18 nights, with the other 12 nights without occupancy, i.e. 60% occupancy rate per month, which has the potential to go higher since the hotel is situated along the Southern bypass.

Kes 18,000 monthly rent.

The average rent for a  2 bedroomed apartment in Nairobi’s middle class Suburb is kes 12,000 to kes 18,000.

This means the investor can then get themselves a cosy apartment near their place of work and pay the rent comfortably from the proceeds of their investment in the hotel project.

Low cost land far off from Nairobi.

The middle class who rent the apartments around Nairobi have the option of buying cheap land in far away places such as Kajiado, Isinya and Kangundo for say kes 600,000 then build a mabati temporary house for kes 600,000 to  make it to kes 1.2m.

They will most often be late to work since these places are too far from their work place.

They will mst often be susscptible to burglar attacks since these remote areas sre quite insecure.

The mabati shacks they build will be too hot during the day and too clod ant night, thereby reducing the quality of living.

Instead of subjecting themselves to the above suffering, the wisest decision is to invest the kes 1.2m in the hotel project described in detail here

http://www.a4architect.com/discuss/

After this investment, the kes 18,000 per month gained from this then goes to offset the montly rent in the apartments they live in.

thogoto hotel

Investors are allocated one room per share based on the floor plan below

plan

Capital gains.

This is a win win situation in that the investment will increase in value by a high percentage each year. They can resell their share in the hotel investment and gain from the high capital increment. For example, if they retire, they can sell the hotel room share and use the proceeds to buy land and build in far away places from Nairobi where land will be cheaper.

 

Francis Gichuhi Kamau, Architect.

info@a4architect.com

Francis Gichuhi (692 Posts)

Architect Francis Gichuhi . B.Arch. University of Nairobi. Registered Architect, Kenya. Member, Architectural Association of Kenya. Contacts. email info@a4architect.com. Telephone +254721410684


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