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Rent Is Falling In Oil-Exporting African Countries As Expats Exit

The Angolan capital of Luanda is still the world’s second most expensive city for expats after Hong Kong, but rent for office space fell almost 50 percent in the past two years in the region’s top oil producing country, Bloomberg reported.

More than 20 percent of new office buildings in Luanda are empty.

“Luanda still has the highest office rents in Africa, but demand has virtually ground to a halt,” said Peter Welborn, the London-based head of Knight Frank’s Africa unit.

Monthly prime office rent in Luanda fell from $150 a square meter in 2015 to an average of $80 per square meter this year, according to real estate consultancy Knight Frank. In Abuja, rates dropped 45 percent to $33 a square meter. Lagos saw rent fall 21 percent to $67. Johannesburg, which is net importer of oil, saw office rents drop 23 percent, while Dar es Salaam held steady.

Rent has fallen for office space and luxury homes in Nairobi, where there’s an oversupply following an exit of expatriates, Business Daily reported.

Kenya became a hotspot for oil and gas exploration after 2012. British explorer Tullow Oil and partner Africa Oil struck oil in Turkana in 2012. Recoverable reserves are estimated at 750 million barrels of crude.

The price of crude has fallen more than 50 percent since mid-2014. Nigeria, the region’s second-largest oil producer after Angola, is in recession.

Industrial space rent is rising in Kenya

Rent in Nairobi malls has stagnated on increased supply. Rent for prime office has dropped 20 percent to $16 per square meter a month over the past two years. But Kenya is short of high-end industrial space.

Source

About our team: Rene Stegmann, Director, MBA, MIM, GMS

Thesis on Hurdles and Costs Relating to Expats in Africa (2000); qualified as a Global Mobility Specialist (GMS).Rene-Stegman-Profile15

Rene has been running Relocation Africa since and has delivered a diverse portfolio of programs and services regarding migration to the African continent. Relocation Africa’s services now include Research (surveys) and International Payroll/payment management services for African countries. Rene also provides HR consultation services to Corporates investing into Africa. As a SARA member, Rene contributes to the local remuneration industry as well as infusing the ERC with some African exposure.  Relocation Africa is a proud member of TIRA and she was elected Vice President of the association (2016).  Her company holds many prestigious awards and Rene was recognized for her valuable contribution to the MI Group’s Worldwide Partner Network International Advisory Council (2014/’15).  Rene and her family live in Cape Town where she and her husband, Andrew, work together.   Her undying love for what she does can be seen in every aspect of how Relocation Africa conducts business.