This week’s Africa Property Focus is on the Democratic Republic of Congo also known as DRC or simply Congo. DRC, located in Central Africa, is the second largest country in Africa by area and the eleventh largest in the world. DRC is extremely rich in natural resources, but political instability, a lack of infrastructure and a culture of corruption have limited development, extraction and exploitation efforts. Read more about its property market below.
The Kinshasa office market is focused to the north of the city, with many of the most important buildings being along Boulevard du 30 Juin. Most of the larger office buildings are owner-occupied by banks and state-related operations. Office development activity appears to have accelerated since the last elections in 2011, but businesses are likely to become more cautious in the run up to the 2016 elections. International companies with a presence in the city include Ericsson, Orange, Citibank, Elf, Vodacom, Nestlé and Alcatel-Lucent. Most offices in Kinshasa are of a fairly poor standard and many are built without air conditioning or elevators. Prime rents are around US$30 per sq m per month, but can reach US$40 per sq m per month for good quality small spaces.
The Kinshasa retail market has shown limited progress in recent years. The Gare Centrale development, which was to have been one of the region’s biggest retail centres and may have brought international brands to the market, has stalled indefinitely. Shoprite is the only major international retailer in Kinshasa, having a supermarket in a prime position in the Gombe district. This site has good car parking, which is rare for supermarkets in Kinshasa. Most other supermarkets are relatively small and many are Lebaneserun. Prices for goods sold in supermarkets can be extremely high.
Historically, industrial property has been located in Gombe and the city centre. However, most of the more recent development has been in the east of the city, in areas between the port and the international airport. Industrial property is clustered around the Route des Poids Lourds, particularly in the areas of Kingabwa and Limete. Medium and large industrial properties are generally owner occupied and there is little speculative development. The leasing market mostly comprises basic second-hand units. Rents in the city centre can be as high as US$12 per sq m per month, but this is for industrial properties that are used by embassies and NGOs, rather than industrial users. Prime rents for new-build industrial properties are more usually in the order of US$8 per sq m per month.
Residential values in the centre of Kinshasa, and in particular Gombe, were driven upwards during the 2000s by the arrival of large numbers of UN personnel. This has also had a knock-on effect on prices in more peripheral areas, and houses in the new Kin-Oasis development at Bandalungwa cost around US$850,000, which is affordable to few locals. There is a major shortage of affordable housing, with the state authorities estimating that 500,000 units are required over the next 10 years; only a small fraction of this figure is currently under construction.
|Population: 77.4 million|
|Major cities: Kinshasa 9.0 million
Lubumbashi 1.8 million
Mbuji-Mayi 1.7 million
Kananga 1.1 million
|Official languages: French|
|Total area: 2,344,858 sq km|
|GDP growth (2014): 8.6%|
|Key export: Copper|
|Currency: Congolese Franc (CDF)|
|EIU country risk rating (E=most risky): D|
|World Bank Doing Business rank (out of 189 countries): 184|
|Kinshasa prime rents and yields|
|Prime rents||Prime yields|
Source: Knight Frank LLP
*4 bedroom executive apartment – prime location
Read the full Africa Report here.