CPF Capital and Everstrong Partner to Fund Nairobi-Mombasa Expressway – What This Means for Real Estate

In a landmark move set to reshape Kenya's infrastructure and bolster its real estate sector, CPF Capital & Advisory Ltd., a subsidiary of CPF Group, has partnered with U.S.-based Everstrong Capital to spearhead fundraising for the Usahihi Expressway Project, a major Kenya infrastructure investment aimed at securing Nairobi-Mombasa Expressway funding. This ambitious initiative aims to raise $1 billion (approximately Ksh.128 billion) through the PACK Hunters Club (PHC), a consortium of financial institutions. These include pension funds, fund managers, investment banks, insurers, and banks. Notably, the involvement of pension funds underscores the growing role of domestic institutional investors in infrastructure development. 

The Usahihi Expressway: A Game Changer 

The Usahihi Expressway, deriving its name from the Kiswahili word for "done correctly," is envisioned as a 440-kilometer, four-lane dual carriageway connecting Nairobi and Mombasa, a major trade route in East Africa. With an estimated total cost of $3.5 billion, this project stands as one of Kenya's most significant infrastructure investments to date. Beyond merely enhancing transportation, the expressway is poised to transform the Nairobi-Mombasa corridor into a thriving economic hub, reducing travel time between the two cities from the current 10.5 hours to approximately 4.5 hours. 

How the Nairobi-Mombasa Expressway Will Transform Kenya's Real Estate Market 

The development of the Usahihi Expressway is anticipated to have profound effects on Kenya's real estate sector: 

1. Enhanced Accessibility and Connectivity: The expressway will significantly improve access between Nairobi and Mombasa, making previously remote areas more reachable. This enhanced connectivity is expected to open up new regions for residential, commercial, and industrial real estate development.
2. Appreciation of Property Values: Improved infrastructure typically leads to an increase in property values. Areas along the expressway are likely to experience a surge in demand, driving up real estate prices and attracting investors.
3. Stimulated Economic Activities: The expressway is set to facilitate smoother and faster movement of goods and people, thereby stimulating economic activities in towns along the route. This economic boost can lead to the development of new commercial centers, industrial parks, and residential areas.
4. Urbanization and Development of Satellite Towns: With reduced travel times, satellite towns between Nairobi and Mombasa may become more attractive for both businesses and residents, leading to urban sprawl and the need for planned real estate developments.
5. Increased Foreign Investment: A major infrastructure project of this magnitude signals a stable and growing economy, potentially attracting foreign investors to Kenya's real estate market.

A Paradigm Shift in Infrastructure Financing

 
This partnership between CPF Capital & Advisory Ltd. and Everstrong Capital marks a significant departure from traditional infrastructure financing in Kenya. By leveraging domestic institutional capital and fostering strategic collaborations between local and international investors, the project underscores a shift towards private-sector-led investments. Dr. Hosea Kili, Managing Director of CPF Group, emphasized, "This project goes beyond infrastructure—it represents a shift towards private-sector-led investments in Kenya’s economy. It highlights the role of domestic institutional capital in driving economic growth and demonstrates the power of strategic partnerships between local and international investors."
 
Ambassador Kyle McCarter, Chairman of Usahihi Expressway Limited, echoed this sentiment, stating, "For the first time in Africa, local pension funds and financial institutions are committing over $1 billion to their own infrastructure. Usahihi represents the shift from aid to trade, paving the way for self-reliance."
 

Conclusion

 
The Usahihi Expressway stands as a testament to Kenya's commitment to sustainable development and economic growth. Investors and stakeholders are encouraged to explore the vast real estate opportunities emerging along the expressway, positioning themselves at the forefront of this transformative project. Its anticipated benefits to the real estate industry are immense, promising to reshape the landscape and unlock new opportunities for investors, developers, and the nation at large. As Kenya embarks on this transformative journey, the synergy between infrastructure advancement and real estate development will undoubtedly play a pivotal role in realizing the African dream.