Kenya leads East Africa in infrastructure development
Kenya led the East African region in infrastructure deals struck in 2015, according to a new survey by financial consultancy firm Deloitte.
The African Constructions Trends Report shows that Kenya accounted for 20 of the regions 61 big-ticket projects followed by Ethiopia with 12 projects.
The report indicates that growth in shopping malls, commercial office development and the ongoing rail project are the biggest areas with the large construction works.
The burgeoning middle class, coupled with the promise of high yields also whet investors’ appetite for retail, entertainment and lifestyle facilities in Kenya and Tanzania, resulting in investment in modern office parks and hotel space.
“Rapid urbanisation and influx of an expanding middle class continues to drive the need for infrastructural reform, expansion and upgrading,” said Mark Smith, Head of Infrastructure and Capital Projects, Deloitte East Africa.
Heavy consumer spending in Kenya has been linked to the rapid development of shopping malls in Kenya.
Among the latest projects that have come online include the Garden City Mall and Thika Road Mall along the Thika Highway.
Investment firm Centum is involved with the construction of the Two Rivers Mall along Kiambu Road while The Hub in Karen is awaiting the entry of tenants.
Collectively the East African region accounted for USD57.5 billion worth of infrustructure projects. The Constructions Trends Report however doesn’t give a breakdown of the value of projects per country.
International Development Finance Institutions (DFIs) were the largest financiers of infrastructure projects overtaking governments in Africa accounting for 48 percent of total projects, and 33 percent of continent-wide financing, with a large exposure to energy and power projects as well as the transport sector.
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