The value of property in Kwale County, which had depreciated over the years because of rampant insecurity, is rising fast, thanks to a thriving economy brought about by mining, sugar processing, and improved in security.
Base Titanium Limited is exploiting titanium deposits around Maumba and Nguluku areas, with the cost of setting up the project infrastructure pegged at Sh26 billion.
Rare minerals estimated to be worth Sh5 trillion have been discovered at Mrima and mining is expected to begin once ongoing court cases are concluded.
The Ramisi Sugar Company, whose collapse in the 1990s threw the local economy into a spin, has been revived and taken over by the Kwale International Sugar Company (Kiscol).
Base Titanium is expected to start exporting ilmenite, rutile, and zircon in two months’ time, and Kiscol will also start crashing sugar cane soon.
“We expect to export the first bulk shipment of minerals from our Likoni facility in January next year.
The operating budget will be Sh5 billion every year, most of which will be injected directly into the economy,” said Joe Schwarz, the Base Titanium general manager in charge of external affairs and development.
At least Sh760 million has so far been invested in community projects, including schools, a health centre, dispensary, community hall, and boreholes.
According to David Ndirangu, a real estate agent based in Ukunda, the sector has become vibrant because of the mining activities.
Most of the villas have been rented by professionals working for Base Titanium and Kiscol and are bringing in high returns.
A two-bedroom villa goes for about Sh5,000 a day and some investors own up to 30 of them.
“Those who own more than 20 cottages earn at least Sh3 million a month, money that is paid annually.
This is the amount of capital that is circulating in the area, and which has excited residents,” he said, adding that over the years, the villas have targeted the seasonal tourist market.
Mr Schwarz said that Base Titanium has rented at least 200 premises for its staff, paying an average of Sh40,000 a month for each.
“For instance, five years ago an acre around the Kiscol area was going for about Sh50,000 but today, we are talking of more than Sh200,000 for the same piece of land,” said Mr Ndirangu.
According to Mr Ndirangu, a two-bedroom house built on an eighth of an acre is expected to fetch rent of more than Sh30,000.
The prices of plots around the mining project have appreciated by more than 300 per cent; two years ago, an acre of land was going for Sh100,000 but today, the same plot sells at more than Sh500,000, according to Mr Ndirangu.
Speaking during the recent Mombasa Homes Expo, Mwenda Thuranira, the Myspace Properties executive officer, said estate developers were targeting to construct housing units in Kwale County for both the domestic and foreign markets.
“Once the mining activities take shape, prospective developers will focus on demand for modern houses,” said Mr Thuranira, adding that real estate growth in the county would rival that of its neighbours, especially Mombasa, which is the most vibrant since several stakeholders, including universities, were targeting the area.
“With the influx of people, the town will grow and give property developers investment opportunities,” he said.
Another factor that is contributing to the appreciation of land prices in the county is the Dongo Kundu bypass.
The bypass to the south of Mombasa Island, with a bridge from Miritini, is expected to open up on the South Coast, promote tourism, and improve road connections to Tanzania.
Last year, the government announced that the Japanese government would fund the project to the tune of Sh28 billion, and although there are no signs that construction is about to start, property dealers have started trooping to the area.
“Initially there was confusion about the route after it was changed and those who bought plots were disappointed but there is no doubt that the moment the earth movers arrive, land prices will go through the roof off,” says Mr Ndirangu.
According to Mr Thuranira, although infrastructure development in the area has been slow due to congestion at the Likoni ferry crossing, property dealers were optimistic that once the bypass was completed, things would change.
Joint ventures
“With the multibillion shilling investments and revenue circulating in the county, lifestyle patterns will change and demand for better housing will rise,” he added.
Commercial property dealers have also reported that business premises are now in high demand, with establishments such as the Diani Shopping Centre, which were deserted because of the tourism slump and insecurity, now recording high bookings.
“The whole of this year has seen people getting interested in business premises, and unlike two years ago, when there was just a couple of us here, there is no vacant space now,” said one of the boutique owners at the centre.
Ukunda town has also grown over the past five years, attracting an array of service providers, with major commercial banks and retail stores opening branches in the town.
