Invest in Student Housing in Africa
The JLL real estate firm in its 2016 report indicates that demand for student housing in sub-Saharan Africa is expected to exceed 500,000 units in the next five years. It should be noted that with the sharp acceleration of urbanization on the continent, there is a shortage of housing in African cities.
The states have withdrawn from the construction of student residences due to budget constraints. The private sector should take over. Born in the United States in the 1990s, the enthusiasm of investors for this sector has not weakened. Billions of dollars have been invested.
In Africa there are a few operators who manage a maximum of 1,000 "beds". In July 2016, an estimated 216,000 beds were missing in South African universities. In sub-Saharan Africa more widely, student housing is also a neglected niche. Over the past decade, higher education enrollments in Africa have more than doubled, with figures rising from 2.3 million to 5.2 million. The real estate market has not kept pace with this growth. There are solutions to this problem.
Private public partnerships are a trail. Universities in Kenya and Ghana have recently concluded major P3 agreements for the provision of student housing. In addition, the Kenyan government is conducting a PPP feasibility study.
Reallocate disused offices or public buildings. For example, in Nairobi many companies leave the city center for peripheral areas. The offices thus liberated could be transformed into student accommodation. In South Africa banks and investment funds finance housing through financial set-up. This could give ideas to the financiers of the rest of the continent.
Another privileged area is the fact that many small private operators are developing an affordable offer that would, over time, provide a genuine alternative. The challenge is that the dwellings will have to be both affordable for the students and profitable for the operator. Alternative solutions already existing to the construction of housing or the recycling of buildings deserve to be structured and amplified: colocation, rooms in the inhabitant ....
In the end this shortage will not be controlled by a miracle solution but by a conjunction of several. It is just time to start worrying about it, at the risk of finding itself once again before an unmanageable problem.