emerging markets - africa the middle east 2011

A CUSHMAN & WAKEFIELD PUBLICATION

EMERGING MARKETS AFRICA & THE MIDDLE EAST

2011

SUMMARY 2

COUNTRY SUMMARIES - AFRICA

TEN MOST EXPENSIVE LOCATIONS 4

TECHNICAL SPECIFICATION & CONTACTS 36

The Peoples Democratic Republic of Algeria 5

The Republic of Angola 6

The Republic of Botswana 7

The Republic of Cameroon 8

The Republic of Cote dIvoire 9

Democratic Republic of The Congo 10

The Arab Republic of Egypt 11

The Republic of Ghana 12

The Republic of Kenya 13

Libya 14

The Kingdom of Morocco 15

The Federal Republic of Nigeria 16

The Republic of Senegal 17

Republic of South Africa 18

United Republic of Tanzania 19

Tunisian Republic 20

Republic of Uganda 21

Republic of Zambia 22

Republic of Zimbabwe 23

The Kingdom of Bahrain 24

The Hashemite Kingdom of Jordan 25

The State of Kuwait 26

The Lebanese Republic 27

The Sultanate of Oman 28

The State of Qatar 29

The Kingdom of Saudi Arabia 30

United Arab Emirates - Abu Dhabi 31

United Arab Emirates - Dubai 32

To aid our clients, we have undertaken an additional update of the Emerging Markets report first published in 2006. This report will review a number of countries across Africa & The Middle East which are becoming established or beginning to emerge as office destinations for multi-national companies. Furthermore, recent events have highlighted the requirement for up-to-date and relevant information.

Data and intelligence in these markets is often limited and certainly can be fast changing. We hope that this review provides a useful summary for those with an interest in the market or a first step for those who have yet to consider its potential.

Our international representation is designed to facilitate the rapid flow of information across borders and is supported by a comprehensive database of market information and regular liaison meetings. This allows for the exchange of local market knowledge and expertise, and for the co-ordination of strategy for international investment and locational decision-making.

If you require any assistance regarding our capabilities in Africa & The Middle East, please refer to Corporate Occupier and Investor Services contact featured on page 36, who will be happy to discuss how Cushman & Wakefield might help.

COUNTRY SUMMARIES - MIDDLE EAST

LEASE TERMS 33

INTRODUCTION

Despite the turmoil witnessed in global markets over the past 3-4 years, the emerging markets of Africa and the Middle East continue to offer opportunities of development and economic improvement. Nevertheless, progress is occurring slowly in many countries, and business can still be difficult to undertake due to poor infrastructure, corruption and a lack of transparency. However, during a United Nations (UN) conference in May 2011, the Secretary General Ban Ki Moon counteracted these concerns, stating that the least developed nations of the world should not be seen as poor and weak but as the best reservoir of untouched potential. Much of this potential continues to lie in the commodity sector, namely in the oil and extractive industries. At the same time, through increased foreign investment other industries are experiencing rapid growth, ones which are anticipated to help propel economic growth within the emerging markets.

In parts of North Africa and the Middle East, remarkable change is happening at a more rapid pace than anyone could have predicted, and the results are both exciting and tragic at the same time. It was a desired improvement in economic prospects that initiated the first demonstrations in southern Tunisia in early 2011, with people angered by rising food prices and unemployment. These protests eventually culminated into a significant wave of political activism, resulting in some of the most dramatic changes in the region since the end of colonialism over 50 years ago. The Arab Spring has touched all parts of the Arab world and has seen previously autocratic regimes fall against the demands for democratic accountability, civic rights and a more equitable society. It will be quite some time before the repercussions of these events will settle, and thus awareness and sensitivity are key for any company operating in these markets.

Corporate reach and societal needs are, of course, not always the same, and the scale and speed of the revolutions in North Africa and the Middle East will require multinational companies (MNCs) to be wary in how they assess and deal with new regimes. While these upheavals bring great change and potential, they also bring an instability that was absent with prior governments. Risk factors, such as political stability, are already crucial considerations for companies seeking to either invest in these markets or when they already have existing facilities currently in operation. Indeed, these events will create a number of practical, and possibly ethical, dilemmas for corporate occupiers to address. Many of the countries are currently attempting to establish new administrations, and thus occupiers must remain pragmatic and be prepared to carry out a much more comprehensive due diligence analysis when proposing investment opportunities. It is crucial for MNCs to adopt a flexible business plan and be sympathetic of local conditions when operating within these markets. With a number of these countries socially and politically unstable, companies must be prepared for situations that may change rapidly. Therefore, occupiers and operators must be able to alter their business models to acknowledge that the traditional one size fits all approach is unlikely to be applicable in these markets. Flexibility and adaptability are the key characteristics for companies that successfully operate within Africa and the Middle East.

Many MNCs are, of course, already operating and thriving within Africa and the Middle East, and this necessitates certain real estate requirements for their businesses. Most office markets remain characterised by a lack of good quality supply, which has helped to push rents upwards in a number of locations to be among the highest not just within Africa and the Middle East but also on a global basis. More specifically, these most expensive locations within the region are in Angola and Nigeria, where demand has been propelled by the traditional drivers of many African markets, namely, access to commodities. According to the World Bank, those 24 African countries whose revenues are primarily oil related have absorbed nearly three-quarters of all foreign direct investment over the past 20 years, with that percentage continuing to grow over the past 2-3 years despite the economic slowdown.

Nevertheless, an increasing number of countries in Africa have witnessed tremendous growth within the service industries, such as banking, telecommunications and information technology (IT), all of which are advancing significantly. For example, the IT sector has almost doubled its foreign direct investment capital into Africa thus far in 2011 compared to the total figure seen in 2010. Furthermore, in Nigeria the restructuring of the banking sector has brought in an influx of foreign direct investment and the banking sector is now, with the exception of the oil sector, one of the largest receiving industries of international capital investment.

One of the most intractable barriers to investing in a large number of African countries is, as anticipated, the crippling lack of basic infrastructure. However, the fact that many African nations are unable to afford large scale infrastructure projects has been seen as an opportunity by the Chinese government in the aim of fostering closer ties with a number of African countries. In return for building new roads, railways, hospitals, etc., Chinese companies are investing in Africas plentiful oil, gas and minerals sectors, with the investment further benefitting the African domestic market. For example, in the Democratic Republic of the Congo, China is building over 2,400 miles of roads and 2,000 miles of railways, as well as multiple hospitals and schools, all in return for 10 million tonnes of copper and 400,000 tonnes of cobalt. This trend of Chinese investment into Africa is a fairly new phenomenon, and consequentially, two-way trade between China and Africa increased in 2010 by over 45% from 2009s volume to reach almost $115 billion. By comparison, trade figures between China and Africa amounted to just $1 billion in 1992, merely highlighting the rapid growth in trade between the two regions.

Beyond Chinas influence in emerging markets investment, other countries have maintained their significant level of FDI flows. The United States, France and the United Kingdom remain some of the top investors into the African markets, together representing almost 33% of all foreign investment projects since 2008. However, in terms of capital investment, the UAE ranks as the country bringing the most amount of foreign direct investment into Africa, revealing a shift in trade growth between emerging

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SUMMARY

market nations, similar to the situation with China. Indeed, there has also been a rapid increase in FDI flows from the other BRIC (Brazil, Russia, India and China) nations over the past 2-3 years. Additionally, domestic trade has been on the rise, particularly in the case of South Africa, which has now joined the other BRIC countries to form the BRICS. South Africa in many ways serves as the gateway between these countries and the African continent who, like China, are interested in Africas need for infrastructure improvements in exchange for access to both the commodities and service industries that Africa offers. South Africa joining the BRICS bloc has opened great opportunities for increased trade between other emerging markets of the world, such as Brazil and Russia, and the developing African continent. Therefore, the development of South Africa as the primary hub to the wider African continent will continue. Although it is not the same size from an economic standpoint as the other BRICS countries, it is one of the more politically and economically stable countries on the African continent. Furthermore, South Africa offers institutional stability and regulatory efficiency that should ensure the trend of companies using South Africa as a bridge to the rest of the continent will continue.

In conclusion, many markets within Africa and the Middle East have experienced an even more turbulent time in recent years than the world at large. As a result, corporates operating in these markets need to be acutely aware of the increased and/or changing pattern of risk factors and act accordingly. At the same time, there exist many new opportunities for businesses in growing sectors, such as banking, telecommunications and construction. Many of these countries will require increased investment to assist in their redevelopment and recovery, and this will also present further opportunities for growth. Therefore, we should expect occupier and investor demand within Africa and the Middle East to expand over the next few years. There will be locations where growth is more apparent and where markets are more accessible or transparent, but the opportunities for the pragmatic and the patient are clearly set to rise.

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SUMMARY

4TEN MOST EXPENSIVE LOCATIONS

The most expensive locations within the Africa and the Middle East region are in the African countries of Angola and Nigeria. Luanda, the capital city of Angola, is the most expensive market, with Lagos in Nigeria in second place. Due to the combination of a severe lack of prime space and a strong and steady occupier demand, rents in Luanda have continued to rise over the year. The economy of Angola is heavily reliant on the extractive industries and is one of the largest producers of rough diamonds in the world, and a sustained occupier demand closely related to these industries has continued to drive rental levels up. As noted, Lagos is the second most expensive location in the region, although rents here are less than half of those in Luanda. Here, it is demand from oil companies coupled with the scarcity of prime space that has fuelled higher rents. The Nigerian economy has also witnessed significant growth in both banking and telecommunications, and occupier demand from companies within these sectors has merely exacerbated rental growth.

Conversely, the office markets in the United Arab Emirates are currently characterised by a large oversupply due to significant new development along with the impact of the global economic slowdown and, consequently, less occupier demand. These markets have recovered somewhat as a result of being increasingly recognised as the more stable business hubs in light of recent political upheaval within the region. Indeed, despite rental levels in both Dubai and Abu Dhabi having fallen over the past year, both locations remain among the most expensive in the wider Africa and Middle East region. Before the economic slowdown and the regional political unrest, the UAE was already utilised by many companies as a gateway to the wider Middle East region. This trend is expected to continue and grow as a result of the continued economic and political stability within the UAE.

Region Country City (US$/sq.m/year) June 11

1 Angola Luanda 2160.00

2 Nigeria Lagos 1080.00

3 UAE Dubai (DIFC) 820.56

4 Qatar Doha 649.18

5 UAE Abu Dhabi 612.58

6 Algeria Algiers 480.00

7 Lebanon Beirut 400.00

8 Ghana Accra 360.00

9 Libya Tripoli 360.00

10 Kuwait Kuwait City 306.23

There often is a distinct polarisation between the quality and transparency of many of the office markets within Africa and the Middle East. Most of the Middle East countries, as well as South Africa, have relatively transparent office markets with established legislation, whereas some of the more emergent locations within Africa do not possess any discernable office markets. As a result, it can be difficult to obtain space when companies decide to locate in these areas. The majority of these markets suffer from both a limited amount of available supply in addition to a lack of developers able to respond quickly to changes in demand.

In order to operate in these markets, companies will have to undertake a more thorough due diligence procedure to confirm that insurance, legislation and regulation matters are all as tight as possible. However, this may not guarantee that the property will meet the minimum standards required by the occupying or investing company, and thus they need to consider the stability and transparency of the country in which they are operating. For example, certain risks such as the respect, or lack thereof, of business and private property laws remain some of the highest concerns for companies conducting business in those less transparent markets. Furthermore, in some countries the states role can be significant; therefore, occupiers and investors need to be aware of potential unplanned circumstances, such as a government default on payments, although this tends to be closely linked to overall stable governance. However, an increasing number of locations throughout the region have introduced reforms to ensure that laws are more clearly enforced, thereby enhancing credibility in terms of attracting inward investment.

These risk factors may be at the upper end of the scale for due diligence and more difficult to ascertain. On the other hand, other aspects including whether foreign companies or individuals can legally own land or property also need to be clarified. Additionally, administrative hold-ups and corruption levels can be difficult to ascertain, and thus the impact of these concerns on a business could not be thoroughly assessed until they are already underway. It is imperative that companies operating across Africa and the Middle East be aware that one size does not fit all, and understand that preparation and enacting a pragmatic approach are key to maintaining successful operations in these regions.

GDP and CPI Growth (2006-2010) %

Office Market

The principal office areas in Algiers are Hydra, Pins Maritime and Bab Ezzouar. With the centre of the city suffering from a lack of space and significant traffic congestion, higher quality space has emerged in the more suburban locations of the city. Pins Maritime, home to the completed Algeria Business Centre, and Bab Ezzouar are located towards the international airport, with Hydra located in the southern part of the city centre. The Bab Ezzouar submarket has developed more recently as a prominent business centre, proving to have higher quality of space and infrastructure as well as a being at a close proximity to the airport.

Currently, several large developments with more expansive floor plates have been in progress, with many buildings at or near to completion. With the large amount of new construction particularly in the Hydra and Pins Maritime areas there remains a high availability of office supply, and thus rental levels have eased down over the last year.

Industrial Market

The main industrial market includes Oued Smar close to Algiers, as well as the areas around the ports of Oran and Annaba to the east of the capital. Buildings are generally older and of poor quality, and the majority of these premises are large-scale refineries and warehouses. As a result, there is a notable lack of modern high-bay industrial units. The market has witnessed a decline over recent years, although the industrial sector particularly from the extractive industry retains significant importance to the Algerian economy.

History

Algeria was initially colonised by the French in 1830, ruling from 1848 to1962. There was a long war of independence between 1954 and 1962 that claimed over 1.5 million lives. Algeria finally gained its independence from France in 1962.

Politics

Algeria is a Presidential Republic. The Head of State is President Abdelaziz Bouteflika, and the Prime Minister is Ahmed Ouyahia. Presidential elections occur every five years, with the next election due in 2014. Uprisings at the end of 2010 and start of 2011 have resulted in President Bouteflika promising further political and constitutional reform.

Economic Overview

Algeria has historically maintained a strong reliance on hydrocarbon and oil exports. GDP growth has been positive over the past few years, and the current high price of oil should help to sustain further economic growth in the next year or so. However, the government is aiming to lessen this industry dependence, seeking to diversify the economy and stimulate further foreign and domestic investment. Additionally, the government has begun to undertake large-scale infrastructure projects, such as constructing new roads and improving railways. Recently, however, Algeria has struggled to facilitate economic expansion, as the slowdown within Europe and the recent protests of early 2011 have both hampered financial services and delayed infrastructure development.

Key Facts

Time Difference (GMT) +1

Population 35,000,000

Capital City Algiers

Language (official) Arabic

Currency Algerian Dinar (DZD)

GDP ($) billion (2010) 159.43

GDP ($) per capita (2010) 4,495

Ease of Doing Business (2010) 136 of 183

Corruption Perception (2010) 105 of 178

Principal Industries - Petroleum, natural gas, light industries, mining, food processing

Typical Rents

Offices: Grade A US$480/sqm/year Grade B US$240/sqm/year

Industrial: High Bay Warehouse - US$96/sqm/yrFactory US$72/sqm/yr

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THE PEOPLES DEMOCRATIC REPUBLIC OF ALGERIA


Key Facts



Capital City Luanda

Language (official) Portuguese

Currency Kwanza (AOA)

GDP ($) billion (2010) 84.39

GDP ($) per capita (2010) 4,423



Principal Industries - Petroleum and oil, diamonds, iron ore, uranium, gold, cement

Typical Rents

Offices: Grade A US$2,160/sqm/yearGrade B US$1,500/sqm/year

Industrial: High Bay Whouse US$180/sqm/yearFactory US$120/sqm/yr

Office Market

The capital city, Luanda, is the major economic centre of Angola, with the prime areas focused around the Marginal and the developing Luanda Sul submarkets. High profile oil and diamond industries in Angola have resulted in an increasing number of international companies locating to Luanda, particularly from the banking and energy sectors. The Angolan office market has been expanding for a number of years due to a lack of high quality supply coupled with strong demand, generally from the prominent extractive industries. This has resulted in rental levels rising significantly, making Angola the most expensive office locations in Africa and also one of the most expensive from a global perspective. However, substantial office development and infrastructure improvements have followed the demand momentum, and this could result in the rate of rental growth slowing over the longer term.

Industrial Market

The principal industrial areas of Angola are located close to the port of Luanda, the international airport and a growing number of specific industrial zones. The oil sector has witnessed significant recent growth, and it now dictates much of the demand within the industrial market, resulting in many owner occupied premises. However, the growing oil and diamond industry has seen demand for industrial premises rise and as a result rental levels remain high.

History

Angola achieved independence from Portugal in 1975. Prior to this, Angola had been a Portuguese colony for over 500 years, and the country had been a significant source of slaves before slavery was abolished.

Politics

Angola is a Presidential Republic. The President is Jose E. dos Santos, and the Vice President is Fernando da Piedade Dias dos Santos. The frequency of presidential elections is not fixed, and elections have been postponed since September 2009; however, they are now expected to occur in 2012. With the new constitution set in 2010, beginning in 2012 the President will now be limited to serving only two five-year terms.

Economic Overview

Oil is the major constituent of the Angolan economy, and as a member of OPEC since 2006, it accounts for more than half of the countrys GDP. Oil production is expected to continue rising against a backdrop of increasingly high prices, and as a result, strong economic growth is set to follow. Furthermore, Angola is also one the largest producers of rough diamonds in the world. High prevailing commodity prices have been extremely beneficial to the economic development of Angola, and this is expected to continue for the foreseeable future, the extractive industries will remain the primary drivers of Angolian economy. However, corruption and inadequate legislation remain barriers to entry for long term investment opportunities.

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THE REPUBLIC OF ANGOLA


Key Facts



Capital City Gaborone

Language (official) English, Setswana

Currency Pula (BWP)

GDP ($) billion (2010) 14.86

GDP ($) per capita (2010) 7,403



Principal Industries - Diamond mining, minerals, agriculture, livestock, tourism, textiles

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Industrial: High Bay Whouse US$60/sqm/yrFactory US$48/sqm/yr

Office Market

The two main office markets in Botswana are the capital Gaborone and, to a lesser extent, Francistown. Current occupier demand comes primarily from the public sector and a small amount of international corporates. There is currently significant activity within the office market in Gaborone, with major development within the CBD underway. Multiple large-scale projects such as the Fairscape Precinct are expected to change the Gaborone city landscape and substantially increase the amount of available modern office space.

The general supply of office stock ranges between various office grades; this is most prevalent in the Gaborone city centre, where prime stock is surrounded by lower-rise developments that have not been subjected to the same planning restrictions. Although prime rental levels have increased over the past few years, it is anticipated that the sheer scale of new development within Gaborone will restrict any significant future rental growth.

Industrial Market

The principal industrial areas of Botswana are located along the main railway line, primarily in Broadhurst, Gaborone West and in Phase 4. With the increasing development of the mining industry, demand for industrial premises is expected to increase. Additionally, major infrastructure improvements, such as new roads and expanded railways, will help to keep the industrial market active over the next few years.

History

The area that is now Botswana was formerly known as the British Protectorate of Bechuanaland. Upon gaining indepdence from the Commonwealth in 1966, the name of country was changed to Botswana.

Politics

Botswana is a Parliamentary Republic, whereby the President of Botswana is both Head of State and Head of Government. The current President is Ian Khama. Elections are every five years, with the next due in October 2014.

Economic Overview

The Botswanan economy is dominated by the mining and agriculture sectors. The mining industry accumulates the majority of resource-based income, primarily from diamonds and, to a lesser extent, copper. The agricultural sector, on the other hand, provides the most employment for the populace. Economic growth has been steady over the past few years, and Botswana is now established as a middle-income country. Additionally, Botswana stands as one of the most economically successful countries within Africa. The economic outlook anticipates further positive growth as the mining sector continues to expand, potentially through the enhanced development of copper and uranium.

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THE REPUBLIC OF BOTSWANA


Key Facts



Capital City Yaound

Language (official) French, English

Currency CFA Franc (XAF)

GDP ($) billion (2010) 22.39

GDP ($) per capita (2010) 1,143



Principal Industries - Petroleum, aluminium production, agriculture, food processing, textiles

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Industrial: High Bay Whouse US$54/sqm/yearFactory US$42/sqm/year

Office Market

The office market in Cameroon is concentrated in the two major cities of Douala and the capital city Yaound. Due to its proximity to the port and prominence with the oil industry, Douala is the historically preferred commercial centre, although the office market is less established. Conversely, the capital Yaound is home to a large number of embassies and is the administrative, governmental and thus office hub within Cameroon. Most demand from international occupiers is for the Quartier de Lac submarket in Yaound. There are a number of ongoing infrastructure and building developments which should both bring more modern quality space onto market as well as improve accessibility within the business areas.

Industrial Market

The primary industrial location in Cameroon is in Douala due to its coastal access and proximity to the railway. Within Douala, the Bonabri province and the areas around Douala port constitute the major industrial centres. Together, these two industrial hubs are home to virtually all of the warehousing and industrial activity within the country.

History

Cameroon first existed under the guise of the German protectorate Kamerun in 1884. After the First World War, the country was divided, with France given administration of Eastern Cameroon and the UK given that of Northern and Southern Cameroons. In 1961, the UK-administered Cameroons held a referendum on the future of their state. The North voted in favour of joining Nigeria; Southern Cameroon chose to join the newly-independent previous French colony of Eastern Cameroon, and together they formed the independent Federal Republic of Cameroon. In 1972, the country finally became the United Republic of Cameroon.

Politics

Cameroon is a Presidential Republic. The Head of state is President Paul Biya, and the Prime Minister is Philmon Yang. The next presidential elections are due in October 2011. Legislative elections occur every seven years, with the next election due in 2012.

Economic Overview

Cameroons economy has been dominated by primary commodities as a result of its modest oil resources and favourable agricultural conditions. However, following a governmental programme to diversify the economy, tourism has emerged as a significant contributor. It is an economy that still has many concerns, with stagnating per capita income, a relatively inequitable distribution of income, a top-heavy civil service and an unfavourable climate for business enterprise. The government has been involved with a number of reforms, supported by IMF and World Bank programmes, to remedy some of these issues, including privatising some public sector operations, fighting against corruption in preparation for presidential elections and increasing efficiency in agriculture.

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THE REPUBLIC OF CAMEROON

Office Market

The major business location of Cte dIvoire is the port city of Abidjan. Here, the primary office submarket is the Plateau area, which also serves as the principal centre for political administration and banking.

However, many occupiers have increasingly relocated their operations to other areas of Abidjan, such as Zone 4 and Cocody. Furthermore, demand levels have been low as a result of the continued political instability that has blighted Cte dIvoire for a number of years. There is a limited amount of development activity underway

in the Plateau submarket, and this should help to slowly increase the provision of prime stock within the city.

Industrial Market

The principal industrial areas of Cote dIvoire are around the port of Abidjan in Treichville, the Koumassi district and the Yopougon area of the city. There is currently a low supply of industrial space, with most industrial buildings defined as small and largely owner-occupied manufacturing or processing premises.

History

Cte dIvoire was originally part of the much larger French colony of West Africa. The country finally gained independence from France in 1960, although it still retains close links to its former colonial power.

Politics

Cte dIvoire is a Presidential Republic. The Head of State since December 2010 is President Alassane Ouattara. The president is elected by popular vote for a five year term with no term limits.

Economic Overview

The economy of Cte dIvoire is highly dependent on cocoa and coffee, which together represent approximately half of the countrys total GDP. It is also a significant producer and exporter of palm oil. Due to this economic reliance on agriculture, Cte dIvoires economy is highly sensitive to fluctuating international prices. Indeed, the industry has suffered a number of impacts that have stopped or slowed economic growth most recently the failure of power turbines in 2010 which, inevitably, caused power cuts and significantly slowed activity. Additionally, social and political factors have held significant influence over the state of the Cte dIvoire economy, in particular the high corruption levels within the government, as well as subsequent political turmoil that occurred recently. Future economic development is highly dependent on political stability, and with the upheaval seen in the early part of the year, it is anticipated that the economy will contract over 2011.


Key Facts

Time Difference (GMT) 0


Capital City Yamoussoukro

Language (official) French


GDP ($) billion (2010) 22.78

GDP ($) per capita (2010) 1,154



Principal Industries - Agriculture, food stuffs, oil refining, wood products, textiles

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Offices: Grade A US$240/sqm/yrGrade B US$120/sqm/yr

Industrial: High Bay Whouse US$48/sqm/monthFactory US$36/sqm/month

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THE REPUBLIC OF COTE DIVOIRE

Office Market

Kinshasa is the capital city and primary business centre of the Democratic Republic of the Congo (DRC). Within Kinshasa, the main commercial office market is located in Boulevard du 30 Juin, while the diplomatic, governmental and administrative centre is focused in Gombe. Recently, other areas have attracted occupier interest due to the lack of available modern office space and poor infrastructure quality within the traditional CBD. Despite improving political stability, the presence of multinational corporations remains low. Those who are present mostly represent the growing telecommunications and oil sectors. Prime space remains scarce within Kinshasa, keeping rents high. However, there are a handful of schemes within the pipeline that should satisfy demand levels for higher-quality space in the immediate future.

Industrial Market

The principal industrial areas in Kinshasa are Limete and Kingabwa. Both industrial locations are serviced by the Route Des Poids Lourds, which is one of the major roads leading to the airport. However, these locations suffer from an underdeveloped infrastructure. Most of the industrial units are outdated, with many considered obsolete. Currently, demand remains high for newer and more modern stock, which has helped to keep rents elevated. Additionally, with little land available, the development pipeline is largely restricted.

History

The Democratic Republic of the Congo was originally part of the much larger Belgian Congo beginning in 1908. The country finally gained its independence from Belgium in 1960, adopting the name of the Republic of the Congo. In 1965, Joseph Mobutu seized power of the country, subsequently changing the name of the country to Zaire. 1994 saw a large inflow of refugees enter the country from nearby strife in Rwanda and Burundi. This influx, in addition to a civil war, led in 1997 to the toppling of the Mobutu regime. Zaire was consequentially renamed the Democratic Republic of the Congo (DRC).

Politics

The Democratic Republic of the Congo is a Republic. The Head of State is President Joseph Kabila, and the Prime Minister is Adolphe Muzito. Elections are determined by popular vote every five years, with the next due in November 2011.

Economic Overview

The economy of the Democratic Republic of the Congo is slowly recovering from decades of economic and industry decline. Most export income is sourced from the mining sector, and therefore, the DRCs economy is highly correlated with international prices. With the aid of the IMF, the DRC signed The Poverty Reduction and Growth Facility in 2010, which has brought $12 billion in multilateral debt relief. In addition, much needed infrastructure improvements are underway, with most taking the form of public/private enterprises.


Key Facts



Capital City Kinshasa


Currency Congolese Franc (CDF)

GDP ($) billion (2010) 13.15

GDP ($) per capita (2010) 199



Principal Industries - Mining, oil refining, mineral processing, agriculture, cement, textiles

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Offices: Grade A US$300/sqm/yearGrade B US$180/sqm/year


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DEMOCRATIC REPUBLIC OF THE CONGO

Office Market

The main office markets are located in the New Cairo and Downtown submarkets of the capital city, Cairo. More recently, the peripheral areas of Smart Village in 6th October City, New Cairo and Pyramid Heights to the west have gained prominence as quality business districts. This is largely due to the unrest seen in early 2011 in Cairos city centre, as these areas offer better security and a higher quality of office space. Over the next year, a number of delayed development projects are predicted to resume, which would provide a significant increase of Grade A office space to the limited supply. Leasing activity is

expected to improve over the next year as the market provides more certainty.

Industrial Market

The principal industrial areas are Sixth October City and Ramadan City. These areas are very popular as they provide guaranteed power supply, accommodation, accessibility and tax breaks for foreign and local companies. All of the units in Sixth October City were built to meet stringent planning consents. There is a low supply of high bay warehouses and a higher supply of factories. The industrial market is beginning to decelerate, with industrial land costing significantly less than other commercial property types.

History

The area where Egypt now stands was home to one of the great early civilisations. Since that period, it has at various points been conquered by both the Arabs and the Ottomans. In 1936, Egypt officially gained independence from the UK after a relatively short period of colonial rule from 1882.

Politics

Egypt is a Republic, with an elected Head of State. However, following the resignation of President Mubarak in February 2011, the Supreme Council of the Armed Forces (SCAF) headed by Defence Minister Muhammad Hussein Tantawi assumed control of the government. The Prime Minister as of March 2011 is Essam Abdel Aziz Sharaf, although a new cabinet has yet to be sworn in. Parliament is currently dissolved; however, Presidential elections were announced by the SCAF to take place within 6 months now delayed until November (2011).

Economic Overview

The major industries inherent to the Egyptian economy are agriculture (predominantly in the Nile Valley), tourism and manufacturing. In recent years, there has been large governmental expenditure on both economic reforms and infrastructure improvements, in hopes to boost economic fundamentals. However, the country remains highly dependent on imports, and therefore, the Egyptian economy suffered greatly under the 2009 global recession. Recovery has been slow but steady, yet Egypt remains behind its neighbouring countries in both expansion and living standards. Furthermore, economic growth has slowed due to the unrest over the past year, and therefore a stronger recovery is anticipated dependent on a more stable, long-term political environment.


Key Facts



Capital City Cairo


Currency Egyptian Pound (EGP)

GDP ($) billion (2010) 218.91

GDP ($) per capita (2010) 2,699



Principal Industries - Textiles, agriculture, tourism, chemicals, pharmaceuticals, manufacturing, construction, cement, metals

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201020092008200720060

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20


GD

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Cha

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CPI %

Cha

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Typical Rents

Offices: Grade A US$ 600/sqm/yearGrade B US$ 240/sqm/year


11

THE ARAB REPUBLIC OF EGYPT


Key Facts



Capital City Accra

Language (official) English

Currency Cedi (GHS)

GDP ($) billion (2010) 31.31

GDP ($) per capita (2010) 1,283



Principal Industries - Cocoa production, mining, lumbering, light manufacturing, aluminium smelting, cement, commercial ship building

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201020092008200720060

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Office Market

Accra is the administrative and financial capital of Ghana and, together with the surrounding area of Greater Accra, it forms the major commercial centre of the country. The High Street is Accras traditional CBD, although the area is limited due to a lack of high quality office space and severe traffic congestion. Consequently, many companies have moved further north to the Ridge area, particularly along Independence Avenue. This has resulted in this part of the city attracting the majority of new office development.

However, with a growing office market and steady demand, these areas that once had high space availabilities are now beginning to reach full occupancy. Therefore, despite new space under construction, prime rents have continued to rise.

Industrial Market

The principal industrial locations are the North and South Industrial Areas within Accra. Additionally, there have been industrial developments of new, modern stock along Spintex Road, which is near to both the port of Tema and the airport. However, due to a lack of funding and poor city infrastructure, the construction of new industrial space has been slow. Coupled with steady demand levels and an advancing market, there is a growing gap between demand and the current low supply of higher-quality space.

History

Ghana was created out of the larger British Gold Coast colony and, later, the Trustee Territory of Togoland. The movement for independence grew momentum after the Second World War, and finally in 1957, it became the first sub-Saharan country to achieve its full independence.

Politics

Ghana is a Constitutional Presidential Republic and the current President is John Evans Atta Mills. Presidential elections occur every four years, with the next election due in 2012.

Economic Overview

As a result of Ghanas abundance of natural resources, the country has approximately twice the GDP per capita output of some of the poorer countries in West Africa. Agriculture and natural resources account for approximately one-third of Ghanas GDP and employ half the population although the services sector, most notably banking and construction, have developed radidly over the last few years. Ghanas economic condition is generally reliant on a small number of key exports within the agriculture/natural resources sectors, namely gold and cocoa. However, in terms of activity and exports, the economy is expected to diversify and grow over time due to the increase in oil production within Ghana, particularly when the offshore Jubilee field begins operation.

12

THE REPUBLIC OF GHANA

Office Market

The major commercial centre of Kenya is the capital city, Nairobi. The office market is relatively mature, with defined sub-markets and a continuous development of good-quality space. The traditional CBD suffers from poor infrastructure levels and a high crime rate. Consequently, other parts of the city have emerged as office submarkets such as the Westlands, Riverside ad Upper Hill where more space and land are available at less expensive rates than in the city centre. The steady development pipeline of prime space has not managed to keep pace with recent demand levels, and as a result, rents have continued to climb. Most

new space is let soon after coming onto market. With demand levels expected to remain steady over the next year or so, rents should remain under pressure.

Industrial Market

Industrial activity in Kenya is focused around the three principal areas of Nairobi, Mombasa and Kisumu. Within Nairobi specifically, the industrial market is widely distributed around the city, where the majority of space are owner occupied. The main warehousing location is adjacent to the international airport, although there are a number of older-style warehouses alongside the main railway line through Nairobi. Additionally, there have been some significant developments along the Mombasa Road, which links Nairobi with Mombasa and also the port.

History

In 1895, Kenya became a British Protectorate and, in 1920, a colony of the UK. After the Second World War, the initial movement towards independence was instigated, but in 1952, the Mau Mau rebellion forced a state of emergency, which was eventually lifted in 1960. In 1963, Kenya achieved independence.

Politics

Kenya is a Presidential Republic. The President is Emilio Mwai Kibaki. Presidential elections occur every four years, with the next election due in 2012.

Economic Overview

The Kenyan economy has recovered from the initial global economic slowdown and has witnessed a rise in GDP growth last year. The economy remains dominated by agriculture and tourism, although growth in the service sector particularly in banking and telecommunications has been more noticeable over the past year. Inflation will remain the primary concern within the economy, as food prices may rise further if agricultural output declines. In the longer term, much needed infrastructural improvements, as well as the continuing famine in the north, may prove to be major concerns if solutions are not devised relatively quickly.


Key Facts



Capital City Nairobi

Language (official) English, Kishwahili

Currency Kenyan Shilling (KES)

GDP ($) billion (2010) 31.41




Principal Industries - Tourism, agriculture, forestry, fishing, financial services

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201020092008200720060

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Cha

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Typical Rents



13

THE REPUBLIC OF KENYA


Key Facts



Capital City Tripoli


Currency Libyan Dinar (LYD)

GDP ($) billion (2010) est. 79.21

GDP ($) per capita (2010) est. 12,100

Ease of Doing Business (2011) Unlisted


Principal Industries Oil and gas production, metals, food processing, textiles, cement

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201020092008200720060

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Cha

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Office Market

Most of the existing high-quality office buildings are clustered to the west of the Medina and the centre of Tripoli, as well as in the more residential Gargaresh district. High demand is largely derived from the oil sector, which has instigated the building of Energy City a mixed-use commercial centre specifically for energy companies on the outskirts of Tripoli. Regarding office developments, the Al-Tadamom Twin Towers was completed in 2010, adding over 50,000 sq.m of office space to the market. It is the fourth major office high-rise in Tripoli, joining the Al Fateh Tower, Corinthia and Five Towers. Additionally, the Burj Al Baher tower complex and Tower 69 are ongoing projects due for completion throughout the next few years. However, the recent unrest in Libya has brought many development projects to a momentary halt.

Industrial Market

Libyas primary industrial centre is in Tripoli, particularly focused within the areas surrounding the port and airport. Nevertheless, the industrial market is relatively small, with the majority of activity deriving from the oil sector. There has been a recent push towards industry diversification, and this should help to expand the industrial market in the near future.

History

The Ottoman Turks conquered what is now Libya until Italy invaded in 1911. Italy was then defeated in the Second World War, and Libya was then passed to UN administration. The country finally achieved independence in 1951.

Politics

At the time of writing, the Libyan government is in a state of interim administration. A series of protests against the government that began in June 2011 have lead to the overthrow of the previous Head of State, Colonel Muammar al-Qadhafi. The rebel force called the National Transitional Council (NTC) has stepped in as an interim authority. As of the end of August 2011, Mustafa Abdel Jalil has been appointed as chair of the NTC. Although the conflict has largely come to an end, pro-Gaddafi forces still pose a threat, and the NTC continue to aim to achieve further support from the Libyan people.

Economic Overview

The oil sector continues to be the largest economic industry for Libya, and the economy depends primarily upon its revenue. Indeed, high profits from energy exports, coupled with a small population, have resulted in one of the richest per capita GDPs in Africa. The non-oil industries account for more than 20% of GDP, having expanded from strictly agricultural processing to include the production of petrochemicals, iron, steel, and aluminium. Concerning foreign investment, the current political upheaval has brought many international companies to withdraw their presence from Libya. The economic outlook for Libya relies heavily on the country reaching political and economic stability, which would reinstate business confidence and fuel further FDI growth.

14

LIBYA* (see page 36)

Office Market

The two main office markets in Morocco are the cities of Casablanca and Rabat. Casablanca is Moroccos prominent commercial centre, where the Sidi Maarouf and Downtown areas are the major office submarkets. Traditionally, strong market development has been restricted by a lack of reliable public transport and car parking. However, two new significant schemes are underway at the Casablanca Marina, with delivery expected in 2012-2013 at the earliest. The Anfa Place mixed-use project will deliver two buildings of around 16,000 sq.m of prime space in total. Nevertheless, with the recent economic slowdown and regional

political unrest, demand has fallen, although this should increase as the political environment stabilises. Rabat is the capital city and the administrative centre of the country, with the principal office submarkets being the city centre and Hay Riad. Rabat is a smaller office market than Casablanca, with demand largely originating from public administration and central government operations.

Industrial Market

Casablanca is the principal industrial area in Morocco, particularly in the Ain Sebaa district. The main port in Morocco will be the new Tangiers-Med that initially came into operation in 2007 and is now anticipated to be completed in 2012, offering considerable container facilities. The industrial market has held up over the last year despite the economic slowdown, with the market characterised by smaller, owner-occupied buildings. Nevertheless, the new scheme in Tangiers-Med should see larger-scale warehousing and logistics facilities appear when development is complete.

History

Morocco has largely been an independent state for much of its existence. It was occupied by the Spanish from 1860, and between 1912 and 1956 the country was divided into French and Spanish zones. Morocco achieved its independence from France in 1956 as well as claiming the Spanish zone. Although Morocco annexed Western Sahara in 1975, Morocco still holds the area, which has now become a major issue in domestic politics.

Politics

Morocco has a Constitutional Monarchy. The Head of State is King Mohammed VI, and the Prime Minister is Abbas El Fasi. Legislative elections occur every 5 years, with the next election due in 2012, although it may be moved to late 2011 following a referendum on the new constitution that occurred in July 2011.

Economic Overview

Moroccos economy is embedded in the phosphate industry, which has long provided a significant source of earnings, as well as the agricultural sector, which remains crucial for job creation. The government has taken measures to diversify the economy away from commodity reliance, promoting other services and industries, such as tourism. Looking forward, GDP growth is expected for next year as an increase in infrastructure and housing investment should help to boost performance.


Key Facts



Capital City Rabat


Currency Moroccan Dirham (MAD)

GDP ($) billion (2010) 91.20

GDP ($) per capita (2010) 2,808



Principal Industries - Phosphate, mining and processing, textiles, construction, tourism, food processing

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201020092008200720060.0

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3.0

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4.0

4.5


GD

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Typical Rents

Offices:(Casablanca)

Grade A US$264/sqm/yrGrade B US$144/sqm/yr

Industrial:(Casablanca)

High Bay Whouse US$60/sqm/yrFactory US$48sqm/yr

15

THE KINGDOM OF MOROCCO


Key Facts



Capital City Abuja


Currency Naira (NGN)

GDP ($) billion (2010) 193.67

GDP ($) per capita (2010) 1,222



Principal Industries - Crude oil, agricultural products, chemicals, construction materials

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8

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Office Market

Lagos is the primary office market and business centre in Nigeria, with offices being concentrated around Lagos Island, which is the hub for commercial activity within the city. Congestion is a significant problem in Lagos, and high traffic levels have encouraged the development of alternative business areas beyond the CBD. The most important of these are Victoria Island, Ikoyi and Lekki, of which Victoria Island is where the majority of conglomerates have their offices.

There is currently a low supply of both Grade A and B office space, which has been driving the recent growth in rental values. However, the market is predicted to ease and over the next 12 months, due to the weakening global economy. The office quality across Lagos remains poor although there are a small number of higher specification premises to be found in Victoria Island. In addition, utilities can be unreliable and many buildings suffer from frequent electricity shortages, it is therefore important to seek premises with adequate back-up generators.

Industrial Market

The principal industrial areas within Lagos are Agbara, Apapa, Ikeja and Ikorodu. The industrial units are typically of adequate quality although utilities are unreliable and can pose problems for larger operators if the property does not have its own back-up supply. Demand has started to rise in the periphery of the city, to submarkets such as Ikorodu. The market forecast to remain stable over the next year as demand levels, although rising, should not push up rental levels too significantly.

History

Nigeria was formed in 1914 and was a British colony until independence in 1960. It became a republic in 1963, but its post colonial existence has been blighted by civil war, coups and military takeovers. Since 1999 civilian rule has been in operation.

Politics

Nigeria is a Presidential Federal Republic. The Head of State is President Umaru MusaYarAdua. Presidential elections occur every four years, with the next election due in 2011.

Economic Overview

Nigeria relies heavily on natural resources, with oil and gas significant constituents of the economy. It is the 11th largest producer of oil in the world, which accounts for 95% of exports by value as at 2008. One of the major challenges for the current Government and the economy is bringing stability to the turbulent Niger Delta region.

Typical Rents

Offices:(Lagos)

Grade A US$1080/sqm/yrGrade B US$350/sqm/yr

Industrial:(Lagos)

High Bay Whouse US$96/sqm/yrFactory US$72/sqm/yr

16

THE FEDERAL REPUBLIC OF NIGERIA

Office Market

The principal commercial centre in Senegal is in the capital city Dakar, where the CBD is located in the downtown area of Plateau to the south of the peninsular. This area particularly in the northern corridor along the Boulevard de Gnral de Gaulle is the hub for major financial businesses and large local companies, as well as most of the administrative operations. Recently, a number of corporate occupiers have been taking offices in the north of the peninsular in areas such as Les Almadies and Ngor. On the development side, a few larger schemes are soon to reach completion, which will help to maintain the strong occupier

demand for Grade A office space. With demand steady and a relatively active market, this new high-quality office space should also help to keep office rents stable.

Industrial Market

The principal industrial locations are the Route de Rufisque to the south of the peninsula as well as the areas around the port and along the railway line that forms part of the Dakar-to-Niger railway. The industrial units tend to be small, low-quality premises with few modern warehouses available. The traditional focus of the industrial market has been manufacturing. However, Dakar is gradually losing its prominence as a manufacturing location, which has affected the amount of international industrial investment within Senegal.

History

The area that is now Senegal was first colonised by the French in the 1840s to become what was known as French West Africa. As with most former colonies at the time, the country finally gained its independence in 1960 and became what is now Senegal.

Politics

Senegal is a Republic with an elected National Assembly. The President is Abdoulaye Wade, and the Prime Minister is Soulayemane Ndene Ndiaye. Elections are held every five years with the next one due in 2012.

Economic Overview

Senegals economy is primarily export-based and reliant on agriculture, phosphate mining and commercial fishing industries. Assisted by a number of external donors, government strategies are now concentrated on improving infrastructure, one of the main steps in improving business and economy. Senegal is a member of the West African Economic and Monetary Union (WAEMU) and has also benefited from the Heavily Indebted Poor Countries (HIPC) Programme, which has helped to cancel two thirds of the countrys debt. With government investment and industrial output rising, the outlook for the economy is encouraging, and GDP growth is expected to move up over the next 12 months.


Key Facts



Capital City Dakar



GDP ($) billion (2010) 12.95

GDP ($) per capita (2010) 1,042



Principal Industries - Agricultural and fish processing, petroleum refining, phosphate mining, construction materials

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Industrial: High Bay Whouse US$548sqm/yrFactory US$40/sqm/yr

17

THE REPUBLIC OF SENEGAL

Office Market

South Africa has the most developed property market on the continent. Although Pretoria is the capital, demand is highest from corporates in the principal commercial centre, Johannesburg. Other prominent office submarkets include Sandton, La Lucia Ridge in Kwa Zulu Natal and Century City in the Western Cape. However, vacancy has risen since the start of 2011 and is expected to continue upwards for the remainder of the year. Despite this, it is anticipated that towards the latter half of 2012, the first signs of stabilisation may occur. In the long-term, the market should show a decreasing vacancy pattern as the net effect of falling speculative development is reflected, which could, again, lead to a shortage of good quality office supply. The more centrally located submarkets should experience further growth, while other more decentralised office locations should see a sluggish market for a longer period of time.

Industrial Market

The principal industrial locations in South Africa are Pretoria, Johannesburg, Cape Town and Durban. In the remainder of 2011, the industrial sector is likely to be far more resilient than others, with new stock coming to market quickly and a higher availability of zoned and serviced land. Vacancy has stabilised and is anticipated to decline by the end of the year. Investor demand lies with the industrial sector as the market offers the security of longer leases with a generally lower-cost investment not entirely seen in other markets. In addition, leases for industrial properties place the accountability of additional costs in the hands of the tenant rather than the landlord, and this often mitigates the landlords risk of increased investment costs.

History

Formerly a British Dominion, South Africa became a Republic in 1961. The country established a system of apartheid that increasingly divided society and government by race. Global pressure, with South Africa considered and treated as a pariah state, finally yielded the end of the apartheid system. The first non-racial elections were held in 1994.

Politics

South Africa is a Parliamentary Republic. The Head of State and President is Jacob Zuma. Elections occur every 5 years, with the next election due in 2014.

Economic Overview

South Africa is a middle-income emerging market with an abundant supply of natural resources and well-developed financial, legal, transport and energy sectors. Its economy benefited dramatically from hosting the FIFA World Cup in 2010. Such events have helped South Africa recover from the financial crisis, in which GDP growth had dropped sharply. Current economic issues revolve around the continued high unemployment rate and a notably outdated infrastructure. The economic outlook is for a slow and steady recovery, with GDP growth anticipated to improve further in 2011 and 2012 as business confidence rises.

18

REPUBLIC OF SOUTH AFRICA


Key Facts



Capital City Pretoria

Language (official) 11 including English

Currency Rand (ZAR)

GDP ($) billion (2010) 363.70

GDP ($) per capita (2010) 7,275



Principal Industries - Mining, automobile assembly, manufacturing, metalworking, financial services

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Offices: Grade A US$178/sqm/yrGrade B N/A

Industrial: High Bay Whouse US$97/sqm/yrFactory N/A


Key Facts



Capital City Dodoma

Language (official) Kiswahili, English

Currency Tanzanian Shilling (TZS)

GDP ($) billion (2010) 23.06




Principal Industries Agricultural processing, manufacturing, diamond, gold and iron mining

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Office Market

Dar-es-Salaam is the primary city for business and commercial activity within Tanzania. The principal office submarkets are the CBD and the Gardens area, which is located immediately to the east of the city centre.

Demand has remained strong in Dar-es-Salaam due to increased urbanisation and a small number of key high-rise developments that are currently underway. However, no completions are expected until the end of the 2011 at the earliest. With prime vacancy low, high quality space remains scarce. This is expected to keep the pressure on prime rents, especially if any of

the proposed schemes are postponed or cancelled.

Industrial Market

The industrial market is concentrated around Dar-es-Salaam, which has retained steady occupier demand. The sector is largely dominated by owner-occupied units distributed throughout the city. In particular, the port area is the main focus for the warehousing market.

In terms of industrial development, the Millennium Business Park is the most prominent scheme over recent years. However, there have been a number of previously obsolete units that recently underwent refurbishments, and this has increased the limited supply of more modern, well equipped stock.

History

Tanzania is comprised of the former German Protectorate of Tanganyika and the UK Protectorate of Zanzibar. In April 1964 the union of Zanzibar and Tanganyika took place with the two regions merging to form Tanzania. The country officially gained its independence away from the UK and Germany, respectively, throughout the following few years.

Politics

Tanzania is a Republic. The Head of State is President Jakaya Mrisho Kikwete, and the Prime Minister is Mizengo Pinda. Elections occur every five years, with the next election due in 2015.

Economic Overview

Tanzania remains one of Africas poorest countries. However, economic growth has been encouraging over the past year, largely due to the rise in the value of gold exports, which has resulted in increased production levels. Furthermore, infrastructure levels are improving, mainly due to the funding from external donors, and this initiative has also given the construction sector a crucial boost. The outlook for economic growth is optimistic, while at the same time there remains concerns regarding inflation, especially if the domestic harvest yields poor results and food prices are pushed up further.

19

UNITED REPUBLIC OF TANZANIA

20

TUNISIAN REPUBLIC

Office Market

The Tunisian office market consists of four principal areas: Berges du Lac, Centre Urbain Nord, Avenue Mohamed and Belvedere. Tunisia has been one of the most attractive business locations in the region but is now recovering following the recent political upheaval. Les Berges du Lac has tended to be the preferred location for international corporates as well as many embassies. Although the recent political unrest pushed rental levels down, currently, rents are rising on the back of a rising demand against a lack of supply. In terms of development, the new financial centre situated at Raoued Nord is nearer to reaching completion, and will increase the amount of available prime space within Tunis. Additionally, new Grade A construction around the Lac de Tunis has made the area a notable business district outside the city centre.

Industrial Market

The principal industrial area of Tunis is located around the airport at Charguia I and II, although interest has begun moving to other industrial locations around the city. Submarkets on the periphery of the city, including Ksaq Said, Manouba and Ben Arous, are sought after due to their cost efficiency and improving infrastructure.

History

Tunisia was a French protectorate from 1881 to 1956. In 1956, Tunisia was granted independence as a constitutional monarchy, although it became a Republic just one year later. More recently, Tunisia was the first country in the region to witness the protests that began in late 2010. These protests served as the catalyst for the significant political upheaval the Arab Spring, which has resulted in a dramatic change in the political landscape across North Africa and the Middle East.

Politics

Tunisia is a Republic. Following the political upheaval, the previous president Zine el Abidine Ben Ali fled the country. Therefore, an interim government has been in place since January 2011, lead under President Fouad Mbazaa and the Prime Minister Beji Caid Essebsi. Elections are to be every five years, although with the current political situation, the next ones are anticipated to occur before 2014.

Economic Overview

Tunisia has a diverse economy, with prominent agricultural, mining, tourism, and manufacturing sectors. With the global economic downturn, GDP growth declined as a result of slowing import demand from Europe - Tunisias largest export market. The country will need to reach even higher growth levels to create sufficient employment opportunities for an already large number of unemployed as well as the growing population of university graduates. There are hopes that developments in manufacturing, and strong growth in the services sector will help ease any downward pressure on the economy from the slowing export sector.


Key Facts



Capital City Tunis

Language (official) Arabic, French

Currency Tunisian Dinar (TND)

GDP ($) billion (2010) 44.29

GDP ($) per capita (2010) 4,199



Principal Industries Petroleum, mining, tourism, textiles, food/beverages

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Key Facts



Capital City Kampala


Currency Ugandan Shilling (UGX)

GDP ($) billion (2010) 17.01




Principal Industries Agriculture (coffee, fish, tobacco), cotton textiles, mining, manufacturing

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Office Market

Kampala is the capital city and commercial centre of Uganda. The main office areas are the CBD, Kololo and Nakasaru submarkets. The beginning of 2010 saw a large speculative pipeline, and by the end of the year many of the schemes were completed despite the recent economic slowdown. Consequently, this has significantly increased the amount of Grade A space on the market. Traditionally, demand for prime space has originated from the financial services and telecoms sectors. However, with the recent economic slowdown, demand from these sectors has eased with many companies seeking to consolidate their office space or move to less expensive premises. This could

result in a rents facing increasing downward pressure over the turn of the year.

Industrial Market

The principal industrial centre is in Kampala. Most development is undertaken for owner occupation intention, with any excess space typically sublet. Industrial units are typically of low quality, and while there is a large availability of older and obsolete factory space, modern and high-quality warehouse units are in short supply. Rising demand is merely exacerbating the current demand/supply imbalance, although further developments in the Kampala Industrial and Business Park (KIBP) should help to improve market stability.

History

The area that is now known as Uganda evolved from a region previously called Buganda. Buganda was ruled by the British and later expanded to include other areas in the region. Uganda gained its independence in 1962, but since this time, the country has suffered dictatorships, coups and military occupation. The conflict between the government and rebel forces finally resolved due to the truce signed in 2009 and the US sponsored Northern Uganda Recovery Act, initiated in 2010.

Politics

Uganda is a Democratic Republic. The Head of State is President Yoweri Museveni. The Prime Minister is Amama Mbabazi. Elections are held every five years, with the next elections due in 2016.

Economic Overview

The economy has remained largely stable over the past year or so despite the recent global economic slowdown. Agriculture remains the most important sector within Uganda in terms of employment but also accounts for a declining proportion of GDP. As a result, the government is keen to diversify the economy with improvements in infrastructure as defined in the National Development Plan, which covers the period from 2010 to 2015. Furthermore, the development of the energy sector is underway with the opening of the countrys first oil well, developed in the Lake Albert part of the country. Therefore, the outlook for the Ugandan economy anticipates continued and steady growth, although rising inflation may be a concern, particularly concerning food costs if production is affected by adverse weather.

21

REPUBLIC OF UGANDA

22

REPUBLIC OF ZAMBIA

Office Market

The main office market in Zambia is located in the capital city, Lusaka. The market itself is fairly established, although much of the current office stock is of lower quality. The most popular areas for new offices are between the Great East Road and the Mass Media area, up to Longacres. Occupier demand is for Grade A, modern and flexible space. As high-quality stock is limited within the CBD and demand remains high, rents for prime space have increased substantially over the past two years. Supply levels are set to remain low as, despite recent international investment and development, there is a notable lack of land adequate for developing Grade A offices. Consequently, with supply expected to remain low and demand for good quality offices to outstrip supply, prime rents are expected to increase over the next 12 months.

Industrial Market

The principal industrial area is the Industrial Node in Lusaka, although new schemes with improved infrastructure and accessibility are underway in an effort to facilitate new industrial hubs within Zambia. Furthermore, demand for industrial units is increasing due to a high manufacturing output. This coupled with limited speculative development and an already low level of quality units, means that supply is struggling to meet the strong demand. This is further spurring occupiers to seek new industrial locations with available land to build suitable quality units.

History

The area that makes up Zambia today was largely free from colonial rule until 1911, when the establishment of Northern Rhodesia saw the area fall under the control of the UK. In 1953 an attempt was made to join both Northern and Southern Rhodesia along with Nyasaland to form the Federation of Rhodesia and Nyasaland. However, this was to only last 10 years until the collapse of the Federation in 1963. Consequently, Northern Rhodesia achieved independence the following year as the newly formed Zambia.

Politics

Zambia is a Presidential Representative Republic. The Head of State is President Rupiah Banda. Presidential elections occur every five years, with the next elections due in October 2011.

Economic Overview

Zambia relies heavily on copper mining, although the agriculture, construction and tourism sectors are becoming increasingly important. The country has experienced strong economic growth due to high copper prices, privatisation and increased foreign investment. Additionally, Zambias economy has benefited through the Heavily Indebted Poor Countries (HIPC) Programme. Zambias monetary policy is concerned with maintaining sustainable, single-digit inflation whist retaining the liquidity of capital required for investment in the country. Furthermore, business reforms are being pursued by the government to encourage priavte sector development. Partnerships have been fostered with the growing markets of China and India.


Key Facts



Capital City Lusaka


Currency Zambian Kwacha (ZMK)

GDP ($) billion (2010) 16.19

GDP ($) per capita (2010) 1,253



Principal Industries Copper mining & processing, construction, agriculture, wholesale & retail trade, chemicals, textiles

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201020092008200720060

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4

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GD

P %

Cha

nge

CPI %

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Typical Rents


Industrial: High Bay Whouse US$60/sqm/ yrFactory US$54/sqm/year


Year GDP CPI

2006 -1.6 1,096.68

2007 -5.5 12,562.60

2008 -14.2 14,929,982,122

2009 -1.3 44,654,800,000,000,000

2010 6.8 3.7

Key Facts



Capital City Harare


Currency Zimbabwe Dollar (ZWD)

GDP ($) billion 7.47




Principal Industries Mining, steel, chemicals, agriculture

Typical Rents


Industrial: High Bay Whouse/Factory US$60/sqm/yr

Office Market

The principal office market in Zimbabwe is in the capital, Harare. The market is well established, with current office stock ranging between Grades A, B and C. Demand for office space has continued to decline over the past years or so as with Zimbabwes fluctuating currency amidst the recent economic crisis businesses have scaled down their operations. Occupiers have begun seeking units away from the CBD for increased cost efficiency measures. Investment activity and speculative development in Zimbabwe are both minimal due to the hyperinflationary and limiting credit conditions of the last few years. However, hyperinflation now appears

to have ended as a result of the new legislation on foreign currencies, which has seen prime rental values rise significantly.

Industrial Market

In previous years, the industrial sector witnessed sharp rises in vacancy rates due to multiple business closures. Currently, with very limited industrial growth expected and a continued lack of domestic industrial business, market conditions are anticipated to remain largely the same. Most of the high vacancy in the market is with large industrial units.

History

The UK annexed Southern Rhodesia from the South African Company in 1923. With the aid of UN sanctions and a guerrilla uprising, the country finally instilled free elections in 1979, leading to the countrys full independence as Zimbabwe in 1980. Robert Mugabe became the first Zimbabwean Prime Minister and dominated the countrys political system since independence, which brought him to the role of President in 1987.

Politics

Zimbabwe is a Republic. The Head of State is Robert Mugabe, and the Prime Minister is Morgan Tsvangirai. Elections are held every five years, with the last held in 2008. The next elections are due in 2013.

Economic Overview

Despite political uncertainties, Zimbabwe is currently making a steady recovery after a decade of economic decline. The country still faces many problems however, including both a large debt burden and lack of formal employment. The governments land reform programme has badly damaged the commercial farming sector, the traditional source of exports and foreign exchange, as well as the provider of 400,000 jobs. However, the power-sharing government formed in February 2009 has brought some economic improvements, including the cessation of hyperinflation by eliminating the use of the Zimbabwe dollar, replacing the currency with foreign ones and finally removing price controls. Currently, the economy has registered its first growth in a decade, although further expansion and recovery will be heavily reliant on further political stability.

23

REPUBLIC OF ZIMBABWE

24

THE KINGDOM OF BAHRAIN

Office Market

Bahrain is a key financial hub in the Middle East due to its strategic location, growing economy and modern regulatory framework. The majority of international companies locate in Manama, the countrys capital. Most of the office stock is located in downtown Manama, the Diplomatic Area and the Seef District, the three prime office areas. The increasing popularity of Manama means that the office stock is modern but, parking is in severely short supply, and traffic congestion remains a concern within the city. Rents for Grade A office space in Bahrain have fallen as the market remains weak. With the recent demonstrations and unrest, office demand has slackened and investment expansion plans put on hold; already burdened with high availability, this market outlook was inevitable. Despite this, the country has now reached a period of relative stabilisation, and there is an expectancy that Bahrain is back to business although the effect on the supply/demand imbalance is not expected to improve in the immediate future. As a result, rental levels are expected to move further down over the remainder of 2011.

Industrial Market

The industrial market in Bahrain is largely concentrated in the oil and aluminium sectors, and the main industrial areas are the Bahrain Logistics Zone, Bahrain Investment Wharf and Bahrain International Investment Park. Despite the overall poor performance of Bahrains property market, the industrial sector has largely withstood the pressures that the residential and office markets have faced. Despite the high availability in certain industrial locations, the market continues to grow.

History

Since the mid 6th century, Bahrain has been under the control of the Islamic rulers as part of the Arabian Peninsula. The Al-Khalifa family ruled over Bahrain beginning in the late 18th century, both establishing a constitutional Monarchy and modernising the country. In the early 1820s, Bahrain became a UK protectorate, which it remained until 1971 until declaring independence.

Politics

Bahrain is a Constitutional Monarchy. The Head of State is King Hamad bin Isa Al-Khalifa. The Prime Minister, Khalifa bin Salman Al- Khalifa, is appointed by the King. The Council of Representatives are voted in every four years, with the next elections still scheduled to take place in 2014.

Economic Overview

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emerging markets - africa the middle east 2011

Documents

tunisian republic

republic of uganda

lebanese republic

republic of cameroon

republic of zimbabwe

republic of senegal

republic of zambia

republic of kenya