Land Price Index Quarter Three Report 2016

LAND PRICE INDEX QUARTER THREE REPORT 2016

Juja, Limuru and Ruiru towns heat up satellite property markets to record highs

• Land prices in satellite towns rose by 7 per cent in the third quarter of 2016 and 21.4 per cent over the year, the highest growth rate since 2014. • Prices in Juja, Limuru and Ruiru continue to feel the effects of the planned infrastructure projects including the Western bypass and the proposed commuter rail. • Juja recorded the highest asking price increase in land at 14.5 per cent amongst the satellite towns, followed by Limuru at 12.4 per cent and Ruiru at 11.2 per cent. • On average prices in the 18 Nairobi suburbs increased by 1.4 per cent in the third quarter of 2016. • Donholm was the best performing suburb with average asking prices increasing by 9.3 per cent in the third quarter of 2016 while Nyari Estate was the worst performing suburb with average asking prices dropping by 3.5 per cent. • Upperhill continues to be the most expensive suburb with an acre of land in the area going for an average of Sh534 million.

Land Index Highlights:

The Hass Composite Land Index, Nairobi Suburbs Quarter % Change Annual % Change Change From 2007

Nairobi-18 Index Results 1.37% 5.67% 5.98 Fold

Suburb with Highest Quarterly Increase in Land Price Donholm ( +9.3% over last quarter)

Suburb with Highest Annual Increase in Land Price Donholm ( +33.99% over last year)

Suburb with Lowest Quarterly Increase in Land Price Nyari Estate ( -3.52% over last quarter)

Suburb with Lowest Annual Increase in Land Price Eastleigh ( -5.57% over last year)

The Hass Composite Land Index, Nairobi Satellite Towns Quarter % Change Annual % Change Change From 2007

Nairobi Satellite-14 Index Results 7.00% 21.39% 7.61 Fold

Suburb with Highest Quarterly Increase in Land Price Juja (+14.54% over last quarter)

Suburb with Highest Annual Increase in Land Price Juja (+43.1% over last year)

Suburb with Lowest Quarterly Increase in Land Price Ngong (-2.29% over last quarter)

Suburb with Lowest Annual Increase in Land Price Mlolongo (-16.52% over last year)

HassConsult today unveiled land price trends for the third quarter of 2016, revealing that asking prices in satellite towns have surged by the highest growth rate in the last three years as the suburbs continue to feel the positive effects of infrastructure investment. Land prices in satellite towns rose by 7 per cent in the third quarter of 2016 and 21.4 per cent over the year, the last time growth rates were in the 20 per cent range was in January 2014. The growth momentum in prices has been sustained by the announcement of the construction of the Western bypass and more recently the proposed commuter rail that will link satellite towns to the CBD, shortening transit times. “As we have seen from previous results land prices tend to increase when roads and other infrastructure projects are set for development. Land prices in Juja, Limuru and Ruiru are benefiting from the proposed Western bypass and commuter rail projects which will make the areas easily accessible,” said Ms. Sakina Hassanali, Head of Research and Marketing at HassConsult. Land prices in satellite towns have now grown by 7.6 times since 2007. Juja was the best performing satellite town with land in the satellite town increasing by 14.5 per cent over the quarter, followed by Limuru and Ruiru which recorded asking price increases of 12.4 per cent and 11.2 per cent respectively. Ngong was the worst performing satellite town with average asking price reducing by 2.3 per cent in the third quarter and this is attributable to heavy congestion in the town. Asking prices in Nairobi's suburb towns on the other hand marginally grew by 1.4 per cent over the third quarter of 2016 and 5.7 per cent over the year. Donholm was the best performing suburb with a 9.3 per cent increase in asking prices for the third quarter of 2016 followed by Langata whose asking prices increased by 7.7 per cent over the same time. “The trend is duplicated in Nairobi, where the suburbs with highest land prices rises over the quarter such as Donholm and Langata is attributable to infrastructure development, namely the Outer Ring Road expansion and the completion of the Southern bypass,” said Ms. Hassanali.

For more information, please contact:

Sakina Hassanali,

Head of Research & Marketing

Quarter Annual Change Nairobi Suburbs Average Value 25 Percenle 75 Percenle Land Index % Change % Change From 2007 Per Acre (KShs)

Donholm 9.3 % 34.0 % 6.54 FOLD 60,800,000 44,800,000 83,300,000 Eastleigh -1.9 % -5.6 % 5.48 FOLD 263,400,000 200,000,000 320,000,000 Gigiri 3.6 % 9.8 % 6.20 FOLD 217,900,000 165,000,000 266,700,000 Karen 3.4 % 11.2 % 7.00 FOLD 54,700,000 48,000,000 60,000,000 Kileleshwa 2.7 % 8.8 % 6.96 FOLD 286,100,000 255,100,000 320,000,000 Kilimani -0.8 % 2.5 % 6.39 FOLD 426,700,000 400,000,000 500,000,000 Kisuru 2.5 % 11.3 % 5.46 FOLD 76,000,000 55,000,000 90,000,000 Langata 7.7 % 14.0 % 5.09 FOLD 54,800,000 45,000,000 62,500,000 Lavington 3.2 % 7.0 % 5.58 FOLD 231,500,000 193,300,000 262,500,000 Loresho -0.9 % 7.4 % 4.99 FOLD 79,400,000 60,000,000 100,000,000 Muthaiga 6.3 % 19.7 % 4.86 FOLD 129,000,000 76,000,000 180,000,000 Nyari -3.5 % -4.8 % 6.16 FOLD 102,600,000 90,000,000 120,000,000 Parklands 0.3 % 4.4 % 5.19 FOLD 403,700,000 340,000,000 500,000,000 Ridgeways 4.0 % 8.8 % 5.95 FOLD 68,900,000 60,000,000 80,000,000 Runda 1.5 % 9.0 % 5.67 FOLD 78,400,000 66,000,000 90,000,000 Spring Valley 1.3 % 5.4 % 3.99 FOLD 149,600,000 116,700,000 176,000,000 Upperhill 3.4 % 5.4 % 8.91 FOLD 534,500,000 500,000,000 600,000,000 Westlands 1.7 % 5.4 % 5.53 FOLD 405,100,000 318,200,000 500,000,000

Quarter Annual Change Nairobi Satellite Town Average Value 25 Percenle 75 Percenle Land Index % Change % Change From 2007 Per Acre (KShs)

Athi River 5.2 % 0.3 % 8.76 FOLD 11,200,000 3,000,000 15,000,000 Juja 14.5 % 43.1 % 11.51 FOLD 10,000,000 3,000,000 13,000,000 Kiambu 4.7 % 15.9 % 7.06 FOLD 40,500,000 15,600,000 56,000,000 Kiserian 6.0 % 17.7 % 6.89 FOLD 6,800,000 2,800,000 10,000,000 Kitengela 2.7 % 17.6 % 6.32 FOLD 9,700,000 5,000,000 12,800,000 Limuru 12.4 % 34.9 % 10.20 FOLD 19,400,000 10,000,000 25,000,000 Mlolongo 1.1 % -16.5 % 4.82 FOLD 23,300,000 12,000,000 36,000,000 Ngong -2.3 % 4.6 % 5.94 FOLD 18,300,000 10,000,000 20,800,000 Ongata Rongai 8.4 % 17.1 % 7.77 FOLD 18,300,000 6,00,000 24,000,000 Ruaka 9.3 % 32.0 % 6.71 FOLD 74,700,000 56,000,000 96,000,000 Ruiru 11.2 % 42.9 % 9.05 FOLD 21,300,000 8,000,000 31,200,000 Syokimau 3.6 % 11.4 % 6.25 FOLD 19,100,000 13,300,000 24,800,000 Thika 7.1 % 25.8 % 8.82 FOLD 18,100,000 7,800,000 26,000,000 Tigoni 5.6 % 7.8 % 7.73 FOLD 19,200,000 17,500,000 21,000,000

*Price Values rounded to nearest Kshs. 100,000

Land Index Heat Maps

Nairobi-18 Suburbs Change in Prices Since 2007

5.46 FOLD 5.67 FOLD 5.95 6.16 FOLD 3.99 FOLD 6.20 FOLD FOLD 4.86 FOLD 4.99 FOLD 5.19 FOLD 5.58 FOLD 5.53 FOLD 5.48 6.96 FOLD FOLD 6.39 FOLD 6.54 8.91 FOLD FOLD 7.00 FOLD 5.09 FOLD

Nairobi-14 Satellite Towns Change in Prices Since 2007

8.82 FOLD

11.51 10.20 FOLD FOLD 7.73 9.05 FOLD FOLD 7.06 FOLD 6.71 FOLD

5.94 FOLD 6.25 FOLD 7.77 FOLD 4.82 FOLD 6.89 FOLD 8.76 6.32 FOLD FOLD

Hass Land Composite Index SNAP SHOTS: Nairobi Suburbs -18 • The Nairobi Suburbs-18 Land Index is representative 700.0 of Land for Sale in Nairobi covering 18 highest activity 600.0 suburbs 500.0 • Land values have increased by 5.98 fold since 400.0 December 2007 300.0

200.0 x December 2007 = 100

Inde 100.0

- 2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013 Q3 2014 Q3 2015 Q3 2016 Q3

Average Land Price SNAP SHOTS: Nairobi Suburbs -18 • The annual average is representative of the average 200,000,000 price of land for sale in Nairobi covering 18 highest 180,000,000 activity suburbs

Sh.s 160,000,000 140,000,000 • The average value for land has gone from 30.3 million 120,000,000 in December 2007 to 181.1 million in September 2016 100,000,000 80,000,000

e Asking Price in K 60,000,000 ag 40,000,000 er v

A 20,000,000 0 2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013 Q3 2014 Q3 2015 Q3 2016 Q3

Supply of Adversed Land Donholm SNAP SHOTS: Nairobi Suburbs -18 Eastleigh Gigiri • The Mix is a measure of the percentage that each 2.1% 2.0% 2.6% 2.2% Karen suburb represents in the market for 18 Nairobi Kileleshwa 2.2% 6.3% Kilimani suburbs Kisuru • Land in Donholm took up 2.1% of the market, 9.6% Langata 24.6% Lavington Eastleigh took up 2.0%, Gigiri 2.2%, Karen 24.6%, 3.0% Loresho Kileleshwa 4.4% Kilimani 6.1%, Kitisuru 5.4%, 2.9% Muthaiga 3.3% Nyari Langata 4.0%, Lavington 14.1%, Loresho 2.2%, Parklands 3.0% 4.4% Muthaiga 3.0%, Nyari 3.3%, Parklands 2.9%, Ridgeways 2.2% 6.1% Ridgeways 3.0%, Runda 9.6%, Spring Valley 2.2%, 14.1% Runda Spring Valley Upperhill 2.6% and Westlands 6.3% respectively Upperhill 5.4% 4.0% Westlands

Hass Land Composite Index SNAP SHOTS: Nairobi Satellite -14 • The Nairobi Satellite-14 Land Index is representative 800.0 of Land for Sale in 14 Satellite towns outside Nairobi 700.0 600.0 • Land values have increased by 5.98 fold since 500.0 December 2007 400.0 300.0

x December 2009 = 100 200.0

Inde 100.0 - 2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013 Q3 2014 Q3 2015 Q3 2016 Q3

Average Land Price SNAP SHOTS: Nairobi Satellite -14 • The annual average is representative of the average 20,000,000 price of land for sale outside Nairobi covering 14 18,000,000 highest activity Satellite towns Sh.s 16,000,000 14,000,000 • The average value for land has gone from 2.4 million in 12,000,000 December 2007 to 18.6 million in September 2016 10,000,000 8,000,000

e Asking Price in K 6,000,000 ag 4,000,000 er v

A 2,000,000 0 2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013 Q3 2014 Q3 2015 Q3 2016 Q3

Supply of Adversed Land SNAP SHOTS: Nairobi Satellite -14 • The Mix is a measure of the percentage that each Athi River 2.0% Juja town represents in the market for the Nairobi 14 8.2% Kiambu Satellite towns 10.9% 3.9% Kiserian 9.9% Kitengela • Land in Athi River took up 8.2% of the market, Juja Limuru took up 9.9%, Kiambu 5.9%, Kiserian 5.5%, Kitengela 5.9% Mlolongo 13.2% Limuru 3.9%, Mlolongo 2.0%, Ngong 6.3%, Ngong 17.8% 5.5% Ongata Rongai Ongata Rongai 7.8%, Ruaka 2.7%, Ruiru 17.8%, Ruaka Syokimau 3.9%, Thika 10.9% and Tigoni 2.0% 13.2% Ruiru Syokimau respectively. 2.7% Thika 7.8% 3.9% Tigoni 6.3% 2.0%

Land as an Investment

SNAP SHOTS:

Land Performance vs Commodies The Hass Land Composite Index, Nairobi Satellite-14 index value was 761 outperforming 900.0 Nairobi Suburbs-18 which had an index value of 800.0 700.0 598, compared to Cattle which had a value of 600.0 500.0 107.7, Gold 164.3 and Crude Oil worst 400.0 performing with only 52.6 index value. 300.0 x Dec 2007 = 100 200.0

Inde 100.0 0.0 2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013 Q3 2014 Q3 2015 Q3 2016 Q3

Nairobi Suburbs-18 Nairobi Satellite-14 Gold Crude Oil Live Cale (CME)

SNAP SHOTS: Land Performance vs Other Asset Classes Ksh. 1 million invested at the end of 2007 would have been worth KSh. 7.61m if invested in land in

9,000,000 Nairobi Satellite-14, KSh. 5.98m if invested in 7,000,000 land in Nairobi Suburb-18, KSh. 2.37m if invested 5,000,000 in property (The Hass Sales Composite Index, All 3,000,000 Properties), Ksh. 2.12m if invested in bonds and 1,000,000 KSh. 1.15m if invested in savings. -1,000,000 2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013 Q3 2014 Q3 2015 Q3 2016 Q3

Nairobi Suburbs-18 Nairobi Satellite-14 Property Equies Bonds Inﬂaon Savings