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Who’s Buying Real Estate In Ghana?

Who’s Buying Real Estate In Ghana?

Housing prices could increase by 50 percent this year in Ghana as the gap grows between supply and demand for real estate, and stakeholders say the quantity and quality of investors seeking to invest is changing, according to a report in VenturesAfrica.

Property developers in Dubai and Abu Dhabi want to form joint ventures with local developers in Ghana and build large-scale residential and commercial developments, said Samir Jain, a former banker and CEO of Phikanet, a Strategy Consulting firm in the UAE.

Russia and Ukraine have been looking at real estate investment opportunities as they believe the returns on real estate in Ghana exceed those found domestically, according to Tetyana Lementarova, nanaging partner of the Ukraine-based law firm, FEOD Group.

And investment from other African countries is growing.

Peter Petrou is a lawyer at FEOD, which specializes in legal and business activities for international clients. Petrou is also managing partner for a London-based law firm, Aspen Morris Solicitors.

Political stability in Ghana coupled with the discovery of deep-water oil in 2007 has fueled a demand for housing and prime office space that continues growing, Petrou said in a guest column in VenturesAfrica.

Housing prices are likely to go up by at least 50 percent in 2015, according to a report from the Housing Data Centre, which gathers data from the real estate and housing sector in Ghana, Petrou said. Ghana’s housing deficit is around 1.7 million units, according to the country’s Ministry of Water Resources, Works and Housing. The average retail rent in Accra increased by about 50 percent to $60-to-$65 per square meter from 2012 to the end of 2013.

Before 2007, Petrou said his clients had little interest in West Africa and were more interested in expanding investments in the Middle East and Far East. There was no appetite for Ghana real estate.

Then U.S.-based oil Exploration Company, Kosmos Energy, discovered a reservoir of oil known as the Jubilee Oil Field off Ghana — one of West Africa’s largest. This led to a boom in the real estate market, according to the VenturesAfrica report.

“Historically, the demand has been from our traditional trading partners – the U.S. and Western Europe,” said Elikem Nutifafa Kuenyehia, founder of Oxford & Beaumont, a firm headquartered in Accra. “However increasingly there is a lot more demand from other African countries – Nigeria in particular as well as the Middle East and Eastern Europe.”

“Investors in the Middle-East and Russia are now comfortable with Ghana and are investing and expanding their operations in the country both on the commercial and residential real estate side,” said Kevin Dadzie, a head of the CH Group of Companies in Ghana. “This can only be good for Ghana.”