LAND PRICE INDEX QUARTER TWO REPORT 2019

Uncertainty of title deed validity cast gloom on Donholm's prices as Upperhill cools down on reduced developer demand

• Advertised land prices in the city remained somewhat static with a 0.6 per cent increase over the quarter while satellite towns revved forward with a 3.2 per cent increase over the same period. • Prices in Donholm drop for three consecutive months as investors shy away from making purchases as the validity of some parcels in the area remain in doubt. • Upperhill begins to cool off as developer demand slows down due to stock of commercial property remaining vacant and expected glut as more properties come to the market. • Satellite towns with land below the Kshs 15 million per acre threshold record the strongest growth over the quarter. • touches record high with prices now 16 times higher than 2007, the highest increase in any town/suburb since the index was launched.

Land Index Highlights:

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

Nairobi-18 Composite Index Results 0.6% 1.7% 6.37 Fold

Suburb with Highest Quarterly Increase in Land Price Land in Spring Valley (+4.4 % over last quarter)

Suburb with Highest Annual Increase in Land Price Land in Loresho (+9.8 % over last year)

Suburb with Lowest Quarterly Increase in Land Price Land in Donholm (-2.0 % over last quarter)

Suburb with Lowest Annual Increase in Land Price Land in Donholm (-2.4 % over last year)

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

Nairobi Satellite-14 Composite Index Results 3.2% 4.2% 8.81 Fold

The Town with Highest Quarterly Increase in Land Price Land in (+8.2 % over last quarter)

The Town with Highest Annual Increase in Land Price Land in Mlolongo (+12.0 % over last year)

The Town with Lowest Quarterly Increase in Land Price Land in Tigoni (1.1 % over last quarter)

The Town with Lowest Annual Increase in Land Price (-1.4 % over last year)

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, www.hassconsult.co.ke T: 0709 479 000 | E: [email protected] LAND PRICE INDEX QUARTER TWO REPORT 2019

HassConsult today unveiled land price trends for the second quarter of 2019, revealing that investors have adopted a cautious approach towards investing in Nairobi's Donholm suburb which has seen prices in the area drop by 2 per cent in the quarter.

Prices in the area have dropped in the last three consecutive months following the National Lands Commission (NLC) announcing in late March that the body was yet to determine the validity of disputed plots in the area which has seen investors shy away from the area until there is clarity.

“Investors are very cautious when issues of the validity or the authenticity of title deeds arise considering the heavy investment real estate projects. Real estate development in Nairobi is capital intensive and therefore it is understandable that investors will take caution before going ahead with plans and as such this affects prices,” said Ms. Sakina Hassanali, Head of Development Consulting and Research at HassConsult.

On an annual basis Donholm has reported a 2.42 per cent drop, the highest annual drop since the index was launched.

Previously the index has cited Donholm as a stellar performer due to construction of Outer Rong road, but uncertainty has eroded these gains similar to towns in in 2017 when they recorded drops in prices following uncertainty over proposed new land laws.

Nairobi's 18 suburbs recorded a 0.6 per cent increase in asking prices over the quarter with Spring Valley recording the highest increase over the quarter at 4.43 per cent.

Upperhill, still has the most expensive land at an average of Ksh550 million per acre, but the suburb is showing signs of cooling off as developer demand eases due to the huge stock of commercial and residential units present and those in the pipeline.

Land prices in the satellite towns recorded a 3.2 per cent increase over the quarter and a 4.2 per cent increase on an annual basis. Satellite towns with land below the Ksh15 million per acre threshold record the strongest growth over the quarter led by Kitengela which recorded an 8.18 per cent. Juja, and Kiserian are other satellite towns that recorded strong growth in the quarter and whose prices are below the Ksh15 million per acre level.

“Prices below the Ksh15 million mark are attractive as investors see that there is still a window for appreciation over the long-term. This price level is below the satellite town average of Ksh21.5 million per acre,” said Ms. Hassanali.

Tigoni recorded the lowest growth over the quarter at 1.06 per cent while Kiambu was the laggard at -1.42 per cent over the year.

Juja has now touched record high with asking prices now 16 times higher than 2007, the highest increase amongst satellite towns since the index was launched. The area continues to gain prominence as a university city coupled with prospects that the area will benefit as major projects in the area develop.

For more information, please contact: Sakina Hassanali, Head of Development Consulting & Research

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, Kenya www.hassconsult.co.ke T: 0709 479 000 | E: [email protected] LAND PRICE INDEX QUARTER TWO REPORT 2019

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

Donholm -2.0 % -2.4 % 7.41 FOLD 68,900,000 56,700,000 80,000,000 Eastleigh -0.3 % 2.3 % 6.20 FOLD 298,000,000 160,000,000 472,000,000 Gigiri -1.8 % 2.4 % 6.95 FOLD 244,300,000 118,200,000 320,000,000 Karen 1.6 % 4.2 % 7.91 FOLD 61,900,000 55,000,000 70,000,000 Kileleshwa 0.5 % 0.6 % 7.46 FOLD 306,600,000 260,000,000 340,900,000 Kilimani 0.5 % 0.9% 6.47 FOLD 432,000,000 400,000,000 480,000,000 Kitisuru 1.1 % 5.8 % 6.36 FOLD 88,600,000 70,000,000 110,000,000 Langata 2.1 % 6.1 % 6.01 FOLD 64,700,000 50,000,000 78,000,000 Lavington -0.3 % -0.2 % 5.73 FOLD 237,500,000 186,700,000 270,000,000 Loresho 2.2 % 9.8 % 5.78 FOLD 91,900,000 80,000,000 103,300,000 Muthaiga 2.0 % 0.4 % 6.60 FOLD 175,019,653 137,500,000 211,100,000 Nyari 3.0 % 2.5 % 6.21 FOLD 103,500,000 88,800,000 125,000,000 Parklands 0.8 % 1.7 % 5.41 FOLD 421,300,000 360,000,000 480,000,000 Ridgeways 1.1 % 7.0 % 6.71 FOLD 77,700,000 64,000,000 84,000,000 Runda -1.1 % -0.3 % 6.22 FOLD 86,000,000 70,000,000 100,000,000 Spring Valley 4.4 % 4.1 % 4.45 FOLD 166,700,000 117,100,000 185,700,000 Upperhill -0.6 % -1.8 % 9.16 FOLD 549,700,000 485,700,000 615,400,000 Westlands 0.6 % 2.6 % 5.71 FOLD 418,600,000 350,000,000 500,000,000

Additional Information Muthaiga North n/a n/a n/a 94,200,000 Muthaiga All 1.5 % 4.6 % 5.67 FOLD 150,400,000

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

Athi River 2.8 % 6.0 % 10.32 FOLD 13,200,000 5,000,000 20,000,000 Juja 4.0 % 10.0 % 16.00 FOLD 13,900,000 5,200,000 18,000,000 Kiambu 1.9 % -1.4 % 7.36 FOLD 42,200,000 22,000,000 52,000,000 Kiserian 5.0 % 5.0 % 7.54 FOLD 7,500,000 3,500,000 9,600,000 Kitengela 8.2 % 7.6 % 7.82 FOLD 12,000,000 6,400,000 15,200,000 2.4 % 1.1 % 11.64 FOLD 22,100,000 12,000,000 32,400,000 Mlolongo 4.5 % 12.0 % 5.64 FOLD 27,200,000 11,200,000 40,000,000 Ngong 1.4 % 5.6 % 6.86 FOLD 21,100,000 8,800,000 30,000,000 1.4 % 4.1 % 9.08 FOLD 21,300,000 8,000,000 28,000,000 Ruaka 2.2 % 3.3 % 8.05 FOLD 89,500,000 64,000,000 113,900,000 4.7 % 4.5 % 10.58 FOLD 24,900,000 11,200,000 32,000,000 Syokimau 4.8 % 9.0 % 7.28 FOLD 22,200,000 14,400,000 28,000,000 1.7 % 1.7 % 9.15 FOLD 18,800,000 7,600,000 24,700,000 Tigoni 1.1 % 0.8 % 9.25 FOLD 23,000,000 16,300,000 28,000,000

*Price Values rounded to nearest Kshs. 100,000

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, Kenya www.hassconsult.co.ke T: 0709 479 000 | E: [email protected] LAND PRICE INDEX QUARTER TWO REPORT 2019

Land Index Heat Maps

Nairobi-18 Suburbs Change in Prices Since 2007

6.36 FOLD 6.22 FOLD 6.71 6.21 FOLD 4.45 FOLD 6.95 FOLD FOLD 6.60 FOLD 5.78 FOLD 5.41 FOLD 5.73 FOLD 5.71 FOLD 6.20 7.46 FOLD FOLD 6.47 FOLD 7.41 9.16 FOLD FOLD 7.91 FOLD 6.01 FOLD

Nairobi-14 Satellite Towns Change in Prices Since 2007

9.15 FOLD

16.00 11.64 FOLD FOLD 9.25 10.58 FOLD FOLD 7.36 FOLD 8.05 FOLD

6.86 FOLD 7.28 FOLD 9.08 FOLD 5.64 FOLD 7.54 FOLD 10.32 7.82 FOLD FOLD

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, Kenya www.hassconsult.co.ke T: 0709 479 000 | E: [email protected] LAND PRICE INDEX QUARTER TWO REPORT 2019

Hass Land Composite Index SNAP SHOTS: Nairobi Suburbs-18 700.0 • The Nairobi Suburbs-18 Land Index is representative

600.0 of Land for Sale in Nairobi covering 18 highest activity

500.0 suburbs.

400.0 • Land values have increased by 6.37 fold since

300.0 December 2007.

200.0 x December 2007 = 100

Inde 100.0

- 2008 Q2 2009 Q2 2010 Q2 2011 Q2 2012 Q2 2013 Q2 2014 Q2 2015 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2

Average Land Price SNAP SHOTS: Nairobi Suburbs-18 • The annual average is representative of the average 250,000,000 price of land for sale in Nairobi covering 18 highest activity suburbs. Sh.s 200,000,000 • The average value for land has gone from 30.3 million 150,000,000 in December 2007 to 192.7 million in June 2019.

100,000,000 e Asking Price in K ag

er 50,000,000 v A

0 2008 Q2 2009 Q2 2010 Q2 2011 Q2 2012 Q2 2013 Q2 2014 Q2 2015 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2

Supply of Advertised Land Donholm SNAP SHOTS: Nairobi Suburbs-18 Eastleigh Gigiri • The Mix is a measure of the percentage that each 0.8% 0.8% 3.2% 0.7% Karen suburb represents in the market for 18 Nairobi Kileleshwa 1.5% 6.5% Kilimani suburbs. Kitisuru Langata • Land in Donholm took up 0.8% of the market, 12.9% 31.5% Lavington Eastleigh took up 0.8%, Gigiri 0.7%, Karen 31.5%, Loresho 2.7% Muthaiga Kileleshwa 3.5% Kilimani 7.0%, Kitisuru 3.9%, 2.9% Nyari Langata 4.3%, Lavington 10.8%, Loresho 1.9%, Parklands 2.1% Ridgeways Muthaiga 2.9%, Nyari 2.1%, Parklands 2.9%, 2.9% Runda 1.9% 10.8% 7.0% 3.5% Ridgeways 2.7%, Runda 12.9%, Spring Valley 1.5%, Spring Valley Upperhill Upperhill 3.2% and Westlands 6.5% respectively. 4.3% 3.9% Westlands

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, Kenya www.hassconsult.co.ke T: 0709 479 000 | E: [email protected] LAND PRICE INDEX QUARTER TWO REPORT 2019

Hass Land Composite Index SNAP SHOTS: Nairobi Satellite-14 • The Nairobi Satellite-14 Land Index is representative 1,000.0 of Land for Sale in 14 Satellite towns outside Nairobi 900.0 800.0 suburbs. 700.0 • Land values have increased by 8.81 fold since 600.0 500.0 December 2007. 400.0 300.0 x December 2009 = 100 200.0 Inde 100.0 - 2008 Q2 2009 Q2 2010 Q2 2011 Q2 2012 Q2 2013 Q2 2014 Q2 2015 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2

SNAP SHOTS: Average Land Price Nairobi Satellite-14 • The annual average is representative of the average 25,000,000 price of land for sale in outside Nairobi covering 14 highest activity Satellite towns. Sh.s 20,000,000 • The average value for land has gone from 2.4 million in 15,000,000 December 2007 to 21.5 million in June 2019.

10,000,000 e Asking Price in K ag

er 5,000,000 v A

0 2008 Q2 2009 Q2 2010 Q2 2011 Q2 2012 Q2 2013 Q2 2014 Q2 2015 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2

Supply of Advertised Land SNAP SHOTS: Nairobi Satellite-14 • The Mix is a measure of the percentage that each Athi River 1.1% town represents in the market for the Nairobi 14 Juja 9.4% 6.3% Kiambu Satellite towns. 8.2% Kiserian 5.3% Kitengela • Land in Athi River took up 6.3% of the market, Juja 5.4% Limuru took up 8.2%, Kiambu 5.4%, Kiserian 5.3%, Kitengela Mlolongo 15.1% 5.3% Ngong 19.1%, Limuru 4.6%, Mlolongo 1.6%, Ngong 7.9%, Ongata Rongai Ongata Rongai 7.9%, Ruaka 2.7%, Ruiru 15.1%, Ruaka 19.1% Ruiru Syokimau 5.3%, Thika 9.4% and Tigoni 1.1% 2.7% 7.9% Syokimau respectively. 4.6% Thika Tigoni 7.9% 1.6%

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, Kenya www.hassconsult.co.ke T: 0709 479 000 | E: [email protected] LAND PRICE INDEX QUARTER TWO REPORT 2019

Land as an Investment

Land Performance vs Other Asset Classes SNAP SHOTS: (The Growth of Kshs. 1,000,000 invested on 2000 Dec) 10,000,000 Ksh. 1 Million invested at the end of 2007 would 8,000,000 have been worth KSh. 8.81M if invested in land 6,000,000 in Nairobi Satellite-14, KSh. 6.37M if invested in 4,000,000 land in Nairobi Suburbs-18, KSh. 2.29M if 2,000,000

0 invested in property (The Hass Sales Composite Index, All Properties), Ksh. 2.64M if invested in

2008 Q2 2009 Q2 2010 Q2 2011 Q2 2012 Q2 2013 Q2 2014 Q2 2015 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 bonds and KSh. 1.35M if invested in savings and Nairobi Suburbs-18 Nairobi Satellite-14 Property only Ksh. 0.49M if invested in Equities. Equities Bonds Savings Inflation

SNAP SHOTS: Land Performance vs Commodities 900.0 The Hass Land Composite Index, Nairobi 800.0 700.0 Satellite-14 index value was 880.9 outperforming 600.0 Nairobi Suburbs-18 which had an index value of 500.0 400.0 636.7, Gold 173.7, Live Cattle (CME) 114.9 and

x Dec 2007 = 100 300.0 Crude Oil worst performing with only 65.4 index 200.0 Inde 100.0 value. 0.0 2008 Q2 2009 Q2 2010 Q2 2011 Q2 2012 Q2 2013 Q2 2014 Q2 2015 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2

Nairobi Suburbs-18 Nairobi Satellite-14 Gold

Crude Oil Live Cattle (CME)

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, Kenya www.hassconsult.co.ke T: 0709 479 000 | E: [email protected]