Property developer Grea has disclosed a Sh1 billion revaluation gain on its housing estate in Nairobi’s Rosslyn that it leases out exclusively to the US Embassy, two years after the property was opened.
Grea is a subsidiary of Mauritian company Grit Real Estate Income Group, which has disclosed in a financial report for the six months to December 2024 that the property —known as Rosslyn Grove— has a valuation of $59.7 million (Sh7.71 billion).
Grea developed the 90-unit property jointly with US-based Verdant Ventures at an initial cost of $51.8 million (Sh6.69 billion). Construction of the estate started in August 2020, and was completed in September 2022.Â
The company also put up a similar estate for the US government in Addis Ababa, Ethiopia, which was completed in November 2021.
Grea, which was founded in 2018, has been developing property targeting diplomatic housing, healthcare, logistics and warehousing sectors across nine African countries.
While embassies in Nairobi tend to house their expatriate staff in estates lying in the high security UN diplomatic blue zone, the Rosslyn property marked the first time that a foreign mission has sought to lease a gated estate for its staff.
Key considerations for the choice of location include security and ease of access to key facilities such as hospitals, the airport, shopping malls and international schools.
The Gigiri area, where the UN environment agency is headquartered and also home to a large number of foreign missions, including the US embassy, is home to the majority of these expatriates.
Surrounding upmarket neighbourhoods such as Kitisuru, Runda, Rosslyn, Nyari and Muthaiga are also popular with expatriates.
The foreign missions, however, incur costs running into millions of shillings every year to secure appropriate housing for their expatriate staff in these prime estates in Nairobi.
The initial disclosures on the Rosslyn property indicated that the US embassy would pay $4.724 million (Sh610.3 million at today’s exchange rate) in rent in the first year of the eight-year lease.
At this rate, the cost of leasing the property for the duration of the contract would be Sh4.9 billion, although Grea did not disclose whether there would be escalations to cater for inflation.
Grea also recently transferred its office to Kenya from Mauritius, in order to access a $48.5 million (Sh6.3 billion) investment from South Africa’s Public Investment Corporation (PIC) after its government cracked down on investments in tax havens.
Grea was set to raise a total of $100 million in a rights issue in June 2024, where PIC was to contribute $48.5 million, but this was held up by the rules on investments into tax havens.
PIC requested a waiver from the investment restriction, which was granted by South Africa’s finance ministry on condition that the Grea move its office to Kenya from Mauritius.
The move is now set to hand Nairobi a windfall in terms of jobs, as well as potential taxes when Grea’s income starts being declared in Kenya.
