In 2050, Africa’s population is estimated to hit over 2.5 billion according to United Nation figures.
A more than adequate economic growth will be realized on the continent.
The middle class is expected to grow from 355 million to 1.1 billion in 2050 according to the African Development Bank.
If the continent has these two key elements: economic growth and population growth, the boom in real estate will indeed be there, and yet…
Bronwyn Knight, CEO, Grit Real Estate Income Group which is the largest pan-African-focused real estate group listed on the Johannesburg Stock Exchange and the Stock Exchange of Mauritius, provided more perspective on the matter.
“We have a diverse real estate offering. The benefit of the business is that we have invested in eight African countries apart from South Africa, and that gives us a diverse platform of offers, light industrial retail hospitality assets. What we’re trying to do is to have the benefit of the growth you see across the African continent and have the real estate solution to support the African growth story,” said Knight told.
The coronavirus pandemic has had an adverse effect on various economies around the world. Africa is not an exception.
The global economy has experienced the worst recession in 90 years, with the most vulnerable segments of societies disproportionately affected according to the Financing for Sustainable Development Report 2021.
Many countries around the world in particular Africa have had to adapt to new ways to remain afloat.
Knight attributed to some African economies being resilient during the pandemic thus fulfilling their desire to explore more avenues and opportunities across the continent.
“So what we have seen is that we have certain asset classes that have been very resilient and other asset classes that have struggled under the pandemic. But we see that especially from a great perspective, a lot of focus on the industry and also focus on corporate accommodation offices,” Knight explained.
Grits’ business model speaks to the African strategy.
They provide real estate solutions, which allow them to sign hard currency leases, either in euros or dollars across many of the economies in Africa.
Grit Real Estate Income has been an anchor sponsor of the Pension Funds & Alternative Investments Africa conference over the years.
The group’s main provision as a lead sponsor is to educate pension funds across Africa into alternative investments, specifically real estate.
This also applies to their ability to invest in not only just traditional equity markets or what they would originally do, but also to have a look at it as an alternative asset class like a real estate business.