Changing home buyer behaviour among Africa’s high net worth individuals is inflating demand for ultra-luxury condos and penthouses in some of the continent’s most iconic cities, with South Africa receiving the bulk of investment in that segment.
By Seth Onyango
Sandton, a bustling financial district in the heart of Johannesburg, South Africa epitomises fine living and extravagance in Africa.
But it is its exclusive real estate offerings, one that caters to every taste, that sets it apart as one of the continent’s top destinations for luxury city living.
According to the international luxury real estate listings site, Mansion Global, the district often dubbed the continent’s richest square mile, thrives on the back of the wealth of Johannesburg city, which boasts the largest concentration of millionaires in Africa.
As of 2021, there were 15,100 dollar millionaires and two dollar billionaires in the city, according to the Africa Wealth Report 2021, making it the continent’s wealthiest city.
Cape Town came in second, with Cairo third, while Lagos and Durban took positions four and five respectively.
In Africa, wealth markets are dominated by South Africa, Egypt, Nigeria, Morocco and Kenya, which together make up 50 per cent of Africa’s total wealth.
The 2022 Knight Frank Wealth Report shows that 10,257 more Africans joined the league of the world’s HNWI, those with a net worth of more than $1 million, in 2021, reflecting an 8.2 per cent jump from 2020. The number now stands at more than 135,000,
“Last year’s global economic rebound supercharged wealth creation,” said Liam Bailey, Knight Frank’s Global Head of Research.
Africa’s giant tech start-up ecosystems made the biggest gains, with South Africa leading the pack, adding 3,809 individuals to the million-dollar league, to reach 31,853 in 2021.
Egypt came second, adding 1,303 individuals to settle at 15,740, as Nigeria’s HNWI population reached 28,996 from 27,928 in 2020, to finish in the third position.
This surge in the number of HNWI is inflating demand for luxury penthouses and condos as well as traditional homes like villas and bungalows, particularly those boasting private spas, phenomenal views and seamless service.
While Africa’s rich are already splurging on top-of-the-range cars, bespoke clothing and accessory brands, online property advertising reveals growing demand for multi-million dollar penthouses.
It shows that the continent’s HNWIs are willing to fork out anywhere between $1 million and over $10 million for a penthouse.
Luxury penthouses in Africa offer valet parking, round the clock security service, a club room, emergency services on call and a swimming pool, often on an upper floor.
Johannesburg and Cape Town have the largest concentration of luxury penthouses in Africa, with penthouses like the mixed-use Leonardo in the former and Eventide Penthouse in the latter, featuring prominently.
In Kenya, international real estate developer Lordship Africa is on course to set up the second-highest residential condominium in Africa, 88 Nairobi Condominium, at an estimated cost of over $50 million.
The 44-floor property in the upmarket Upper Hill area of Nairobi targets doctors, lawyers, bankers, expatriates and MPs who are looking for luxury living.
It follows a feasibility study conducted by Lordship which showed high demand for quality accommodation in Upper Hill, which already boasts an impressive skyline.
The Aviation Industry Corporation of China’s six high-rise towers in Nairobi’s Westlands suburbs are also nearing completion. Marketed as Global Trade Centre (GTC), the imposing structures will include the 184m-tall Avic Tower, with 47 floors, the topmost of which will house A-grade offices.
The second tallest tower, at 142 metres and 35 floors, will house a hotel that is to be operated by Marriott International, an American hospitality firm.
Ikoyo district in Lagos, Nigeria is also increasingly dotted with ultra-luxury penthouses costing upwards of $3 million each.
The nearly completed, Belmonte Ultra Luxury Homes is a stunning 20-floor architectural masterpiece nestled on Bourdillon Road, Ikoyi, the wealthiest neighbourhood in Lagos.
It promises exclusivity with a choice of spacious luxury apartments, lavish duplexes and presidential penthouses.
Egypt and Morocco are also warming up to the luxury penthouse offering, in a market where the luxury hotel business is booming.
Mordor Intelligence (MI) estimates show that Africa’s construction market, which was valued at around $5.4 billion in 2020, is expected to register compound growth of some 7.4 per cent during the period of 2021 – 2026.
“The African construction industry is the target destination for most large economies. This is because of accruing benefits and/or advantages such as availability of huge natural resources, huge investment opportunities in energy and infrastructure, cheap labour, and a fast-growing consumer market,” the Mordor report said.
According to industry sources, some 482 projects valued at $50 million or above had each broken ground by 1 June 2018.
In total, these projects are worth $471 billion – nearly doubling the total project value from 2017 which totalled $210 billion.
According to MI, as a region, East Africa has the largest number of recorded projects, with 139 projects.
North Africa accounts for the largest share of projects in terms of value, at 31.5 per cent (or $148.3 billion). The projects included are spread over 43 of Africa’s 54 countries.
Egypt is the single country with the most projects with 46 (9.5 per cent of projects on the continent) as well as the most projects by value at $79.2 billion (17 per cent of the continent’s value), edging out South Africa and Nigeria respectively.
Most of the upcoming projects are promising to utilise spaces in African cities where city land is shrinking while maximising building heights and luxury living. ((Bird Story Agency)
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