The API conference has become an important event for real estate practitioners who do business on the African continent. This was my first time attending the API conference and I was impressed with the turnout, especially considering that the event is still relatively young.
The panel discussions covered a diverse range of topics. I was particularly interested in the panel discussion hosted by Standard Bank titled “financing your real estate project”. This discussion focused on the current practice that is employed to finance real estate transactions in Africa. Through this discussion it became rather evident that South African banks, operating in Sub-Saharan Africa, would much prefer to lend in local currency, whereas regional and international developers and investors would prefer to borrow in U.S. Dollars. It was in fact suggested that the overall cost of funding could potentially be less expensive if funded in local currency as opposed to U.S. Dollars, after taking the depreciation of the local currency into consideration. The debate was insightful and this is no doubt a topic that needs to continue to be debated in order to arrive at a sustainable funding model for real estate projects and investments on the African continent.
A key take away from the conference for me is that investors and developers are starting to increase their efforts to find opportunities in the growing economies of East Africa. West Africa, although negatively impacted by the fall in commodity prices, especially the oil price is however still a region that many investors simply cannot ignore given the scale of the market and the opportunities this market presents for real estate.
The conference certainly provided a useful platform for delegates to engage and network with old as well as new faces, and to reflect on the current market conditions and to contemplate what the future holds for real estate markets on the African continent.
I most certainly look forward to attending next year’s conference.