NAIROBI: National Housing Corporation has announced that it will venture into mall development, which has better returns than building homes, in a shift in strategy that could be a deviation from its primary objective.
The firm’s new managing director, Andrew Saisi, said yesterday that returns on commercial development outweigh profitability in constructing homes, a segment that is currently experiencing an acute shortage.
“The commercial segment of real estate has gone up by seven per cent, while that of the residential segment has gone up by four per cent,” explained Mr Saisi, who reports to work this morning.
He has been the general manager of the new building technologies factory owned by the corporation. No timelines were, however, given on when the corporation will start developing its first commercial property.
The corporation already owns a commercial block in Nairobi, which houses dozens of businesses and its corporate offices.
Saisi, who was accompanied by the board chairman, Sammy Chepkwony, and other directors, said the move was informed by the need to generate more returns for NHC, as the corporation does not depend on any support from the State.
Construction of social housing is an expensive venture that would need direct input from the Government.
“Providing social housing would involve input from all stakeholders, and not just the NHC,” said Chepkwony, responding on whether the agency had failed in its core mandate of building affordable homes.
Among the homes that the corporation has built in Nairobi are apartments in Nairobi West, Madaraka and Kileleshwa neighbourhoods. The homes were selling at up to Sh13 million, which is way over the rates that the average Kenyan buyer can afford.