New report shows 89% occupancy rate in the Kampala Metropolitan Area Kampala, Uganda | JULIUS BUSINGE | Stanbic Properties Limited inaugural report on properties shows that the average occupancy rates in Kampala stood at 89% for Grade A, 83% for Grade B and 74% for Grade C buildings in December last year signalling increased interest for rental properties.
The report says that the prevailing median rents were recorded at US$15, US$11 and US$8/m² /month for Grade A, B and C buildings respectively exclusive of service charge.
The report further says, market evidence indicated more demand for the newer Grade A office buildings that feature large – open layout floors and state-of-the-art design and safety characteristics emanating from companies in the oil and gas, financial services, government parastatals and engineering sectors.
Spencer Sabiiti Oyes, Chief Executive of Stanbic Properties, a subsidiary of Stanbic Uganda Holdings Ltd, said the key firms that stimulated this trend are those that had previously been leasing smaller spaces in lower-tier Grade B multiple buildings because the market never provided ample opportunities to consolidate their operations in a single building.
Other key demand drivers, according to the report, included exclusiveness of the stand-alone Grade A office structures evidenced by an increase in enquiries away from multi-tenanted office buildings, to take advantage of branding and fully control their security requirements.
Furthermore, demand for space in the lower tier Grade B and C buildings whose rents are low was dominated by start-ups as well as small and medium enterprises.
Sabiiti said, they also noticed several non-governmental organisations scaling down on their rental space by consolidating their operations in single stand-alone formerly residential buildings as opposed to renting several buildings particularly in areas of Bugolobi, Muyenga and Naguru.
This trend was primarily driven by downsizing due to COVID19 related budgetary constraints faced by foreign funders as well as a growing work from home trend for employees who only use formal office workspaces on a needed basis.
In terms of pipeline, the completion of buildings currently under construction will add approximately 36,000 m² of lettable space to the existing stock by the end of 2023.
It is anticipated that Grade A space will account for 90% of the pipeline developments, according to the report.
Retail property market The formal retail sector was traditionally concentrated in Kampala’s central business district and a few high-end residential areas in the peripherals particularly Naalya, Lubowa and Entebbe.However, the report says, the growth of […]
