Real estate conference to drive investment into the economy – Mozambique

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Real estate conference to drive investment into the economy – Mozambique

12:28 CAT | 10 May 2018

Photo: Spplied

The Mozamreal Property Forum on the 20th of June will restore investor confidence and generate millions of dollars of direct and indirect investment into the Mozambican economy and the country’s stifled real estate sector.

Presented by API Events, this one-day bilingual forum’s theme is ‘Reviving the Mozambican Property Market.’

For Mozamreal’s managing director, Kfir Rusin, this year’s forum is taking place at the perfect time for a market, which is starting to enter a recovery period.

“The last few years have been an intensely difficult period for developers and investors in Mozambique, but we believe that the market fundamentals are improving, and, more importantly, so is international and regional interest picking up, which is evident in the number of high profile sponsors and speakers at this year’s event. We’re pleased that some of the biggest regional and local names have come onboard RLB Pentad, Grit Real Estate, Broll Property Group, Meridian32 Group, Prime Yield, BCI and the Beluluane Industrial Park.”

As interest continues to grow, one of the critical objectives of the conference is to unify the local property market and provide insight on how to survive in what is an improving, but complex trading environment.

For Rusin, the value of the conference is of significant value to the local economy and property sector. “We have delegates and speakers flying in and staying at hotels and numerous investors and developers who represent funds with a combined value of billions of US dollars interested in emerging opportunities.”

With just over half of the 250 delegates coming from regional neighbours and international investors, the forum will provide a boost to local hotels and restaurants, as senior stakeholders jet into the country.

The most substantial funds represented at this year’s forum, who will be speaking include some of Africa’s largest funds, including Grit ($925 million), Actis ($500 million) and Novare ($350 million).

Following the success of its conferences over the past decade across Africa, many investors and developers use API Events’ conferences to gain better insight, meet partners and conduct their due diligence on key markets.

For Rusin, the interest in Mozambique by some of Africa’s largest investors reinforces his belief that informed and motivated investors who enter the market now can enjoy first-mover advantage.

“If investors invest now and take their time to meet local players, they will be in a prime position, as the market is expected to be one of Africa’s most attractive and lucrative investment destinations, especially with the LNG projects finally coming online,” he says.

The LNG projects are set to transform the economic and social fabric of Mozambique. It is estimated to create more than 600,000 jobs in the Mozambican economy and account for more than 56% of the country’s GDP by 2035 and grow per capita GDP ten-fold from $400 to $4,435 according to Standard Bank.

As the economy gathers momentum, there will be an increased need for land dedicated to manufacturing and industry says Adrian Frey, Chairman of the Beluluane Industrial Park. Aiming to attract significant direct foreign investment, the park is currently home to 35 companies from 15 different countries within the engineering, automotive, consumer goods and processing industries. With some reports suggesting economic growth of 20%

in the coming years due to the LNG projects and foreign investment, Frey says, “We believe that the park will attract as many as 500 new businesses, and potentially creating more than 50,000 new jobs.”

Echoing Frey’s sentiment in the growth potential of the economy, Aly Faruque, the Managing Director of Innovative Asset Management, the local partner for Mozamreal, believes the opportunities for developers and investors are already taking shape.

“Multinational corporates need office space and homes to live, and we will see greater investment in infrastructure across the country.”

The critical factor for Faruque, and API’s delegates is that Mozambique’s geographic and economic hubs provide investment and development opportunities for hotels, retailers, housing and offices across the length of the country.

“If we look at most African countries from a real estate market perspective, it’s predominantly focused on cities like Nairobi, Lagos, Dakar and Abidjan.” Whereas in Mozambique due to tourism, mining, oil and gas, we have economic hubs needing development in Maputo, Nampula, Tete, Vilanculos and Pemba. This diversification of our economic base is what is attracting foreign investors. But a concern for investors is understanding the local complexities like the Land title (DUAT), taxation, project funding in a context of high interest rates for local borrowings and forex repatriation,” says Faruque.

For Manuel Vieira, the director of Meridian32, the time is now, and he asserts that the government is working hard to make the country easier to invest in. “We have seen this with the devolution of certain aspects of forex and investment authorisations, previously conducted by the Central Bank, now in the sphere of the commercial banks.”

While appreciative of the government’s acheivements to address challenges in the market, Vieira proposes that the government should adopt a new land usage policy. “Land should be subject to a two-tier system – that which is reserved for low and middle income residential ownership, as well as subsistence farming activities under a protective legislative environment and a second tier of land zoned for commercial development – be it residential, leisure, agriculture or any of the commercial uses.” Establishing such a policy for Vieira would help further increase investment, generate more revenues and create sustainable employment.

For Rusin, the opinions shared by Vieira, Frey and Faruque provide a good barometer of what attendees can expect at Mozamreal. “We’re going to change a lot of perceptions and give the local market a boost. The high-level of speakers already confirmed for the forum is a first for Mozambique, and speaks volumes for the opportunities available in the country.”

Source: Press Release / Distributed by API News