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News Release

​CAPE TOWN, South Africa

Twenty African cities emerge as next frontier for commercial real estate growth between now and 2020

Retail expansion, corporate outsourcing and positive economic signs point the way, but market transparency must improve

CAPE TOWN, South Africa, May 8, 2013 – Jones Lang LaSalle has identified twenty cities across Africa that present key opportunities for commercial real estate growth by 2020 as retailers, corporates and real estate investors target growing urban centres in countries with solid GDP growth prospects. While poor real estate transparency continues to constrain many of these cities, there are potentially huge pay-offs if they can improve regulatory environments and transaction processes. 

The 20 African cities are:

​Angola: Luanda Mozambique: Maputo
Egypt: Alexandria, Cairo Nigeria: Abuja, Lagos
Ethiopia: Addis Ababa South Africa: Cape Town, Durban, Johannesburg
Ghana: Accra Tanzania: Dar es Salaam
Kenya: Mombasa, Nairobi Tunisia: Tunis
Morocco: Casablanca, Marrakech, Rabat, Tangier Zambia: Lusaka
The 20 cities collectively represent an urban population of 70 million people and 11 of the cities are located in just four countries:
  • Egypt: Cairo, the most populous city in Africa, and a key target for developers, despite political and economic uncertainties
  • Morocco: Casablanca, the largest city in the Maghreb region and an emerging outsourcing hub
  • Nigeria: Lagos, the commercial hub of Africa’s second-largest economy and a city witnessing rapid GDP growth at over 7 percent
  • South Africa: The continent’s only transparent real estate market

Top 20 African cities for commercial real estate growth, Jones Lang LaSalle, April 2013

Mark Bradford, Managing Director, Jones Lang LaSalle South Africa highlighted that, “the last 15 years have seen economies like Brazil and China emerge and lead global growth. This was because they possessed the right balance between the consumer growth opportunity and appropriate operational infrastructure which attracted retailers. We feel now is the time for Africa to step up and take centre stage for the next 15 years.”

Platform for retail growth
According to Jones Lang LaSalle, Africa’s strengthening regional economies and improving operating environment, rapid urbanisation and emerging middle class consumerism present strong opportunities for established international retailers to expand their footprints and enter new markets.

“This influx of retailers is really the start of the process. It encourages retail real estate developers to build better quality shopping malls, which encourages investors who see the growing development cycle. In South Africa, total commercial real estate investment volumes were USD 4.5 billion over 2011 and 2012, of which USD 2.2 billion was focussed on retail. However, this retail component was dominated by domestic investors, with only 20% of retail real estate investment being cross-border, involving overseas partners. This compares to the mature real estate markets of Europe such as the UK, France and Germany, where around half of retail real estate investment is cross-border in nature. The question is, are we ready for the next wave of global investment?” added Bradford.

Outsourcing hub
Improving business confidence and increasing cross-border investment also are predicted to support corporate outsourcing into Africa, as many corporates implement long-term strategic growth plans.

Outsourcing hubs in Africa, such as Johannesburg, Cape Town, Durban, Accra, Port Louis, Nairobi, Casablanca, Tunis, Cairo and Alexandria, are expected to benefit from this ongoing trend.

Christian Ulbrich, Chief Executive Officer, Jones Lang LaSalle Europe, Middle East and Africa, commented, “global uncertainty over the last few years has impacted corporate strategy and location decision-making. Offshoring is an established business strategy that can help optimise productivity, labour resources and revenues through access to growth markets. Although not without risks, financial services, consumer goods, pharmaceutical, telecoms and energy firms continue to target the African opportunity.”

Transparency challenge   
Despite strides to encourage intra-regional trade and investment across Africa, Jones Lang LaSalle’s Sub-Saharan Africa report highlights challenges and low real estate transparency levels.

The Southern African region has been an internationally preferred location for doing business but even here there is a range of operating conditions.

Countries such as Lesotho and Swaziland continue to suffer from a lack of investment and economic development, while on the other hand, Botswana and Namibia have managed to attract international investment with higher GDP per capita, and more sophisticated governance and regulatory structures.

Jeremy Kelly, Global Research Director at Jones Lang LaSalle and author of the Global Transparency Index explained, “there is a high variation in real estate transparency, befitting the markedly different levels of development and infrastructure in Africa. South Africa stands head and shoulders above the rest of the continent and has made steady improvement over the last two years, such that it now ranks as the 21st most transparent global real estate market.

Botswana, Mauritius, Kenya are showing signs of improvement; however, the majority of sub-Saharan countries such as Nigeria and Angola are characterised by low transparency. These markets will improve when stronger legal and operational controls are enforced, mitigating investor and corporate operational concerns.

About Jones Lang LaSalle
Jones Lang LaSalle (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual revenue of $3.9 billion, Jones Lang LaSalle operates in 70 countries from more than 1,000 locations worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services to a property portfolio of 2.6 billion square feet and completed $63 billion in sales, acquisitions and finance transactions in 2012. Its investment management business, LaSalle Investment Management, has $47.7 billion of real estate assets under management. For further information, visit