With only one new Grade A office development under construction in Lusaka, the market currently favours landlords. The majority of recent speculative developments, such as Elunda 3, KPTF Office Park and Trinity Park, have been pre-let or leased within 3-4 months of their completion. The lack of new space in the pipeline will force tenants to plan carefully for any future expansion. Good local infrastructure is important in attracting tenants to new locations, with occupiers seeking properties that benefit from good roads, sufficient electrical power, public transport, fibre optic cable availability and plenty of parking.
Zambia has witnessed an influx of South African retailers, however, a number appear to be resisting immediate further expansion until their existing operations meet revenue expectations. A shortage of retail space is expected as, apart from the Twin Palms Shopping Centre in the suburban area of Avondale, which is due to open in the final quarter of 2013, there are no other malls under construction in Lusaka. There are viable opportunities for new retail developments in suburban areas outside Lusaka CBD and in other towns in Zambia, particularly in the Copperbelt where the new Kitwe Copperhill Centre, anchored by Pick N Pay, has recently opened. Uncertainty over the rebasing of the Kwacha in January 2013 may create issues for retailers.
There is increasing interest from developers as the industrial market is undersupplied and underserviced and does not cater to the requirements of modern international companies. The development of new facilities in key areas will assist in securing new industry and manufacturing business for Zambia. Interest focuses on Lusaka as it is
viewed as an entry point from South Africa into the centre of the Sub-Saharan market.
The residential market is shifting from a landlord’s market to a tenant’s market, with increased choice and affordable prices. However, highend quality housing remains elusive. Demand is strong for stand-alone housing compared with cluster developments, and also for newer upmarket areas further away from the city centre. The medium-cost plot and housing market is the main area of growth and potential. There is ongoing interest and investment in commercial farming land throughout Zambia from both overseas and local investors.