How a 50km road project built property millionaires
By Awal Mohammed
| Jul 16th 2020 | 5 min read
“Roads remain the essential network of the non-virtual world. They are the infrastructure upon which almost all other infrastructure depends. They are the paths of human endeavour.”
When Ted Conover, a celebrated journalist and American author, said this, he certainly did not have Thika Highway in mind.
The eight-lane expressway - which stands tall among former President Mwai Kibaki’s legacies - has changed a vast region of the country.
Before construction of the highway, the previous road was constructed to bitumen standard in the early 1970s and re-sealed with an overlay in the early 1990s, according to the Kenya National Highways Authority.
Due to the increasing number of road users, the highway was operating beyond its capacity - carrying more than 60,000 vehicles per day.
Besides, its condition had deteriorated - not forgetting the constant traffic jam on the road, and it required rehabilitation.
So when the government announced its intention to splash Sh30 billion on what Kibaki described as the most ambitious infrastructure project in the country’s history, critics rose up in arms.
The 50-kilometre stretch that at that time gallantly sought to open the northern part of the city was seen at best as another failed project and at worst a corruption scheme to embezzle public funds and leave the taxpayers with a huge loan to pay.
Yet, eight years after its completion, the Nairobi-Thika Superhighway has not only brought the northern part of the city closer, but also acted as the proverbial northern star, with other African countries benchmarking and marvelling at its architectural beauty.
The first benefit of the construction was not monetary but psychological. A boost in the nation’s morale 50 years after independence to imagine and a major infrastructure project. Kenyans have frequently compared the superhighway with others around the continent in their social media battles with neighbouring countries.
The monetary benefit of the project is evident. The journey to Thika some 42 kilometres from Nairobi CBD used to take between two and three hours, but the time was reduced to less than an hour without the traffic snarl-ups at the entry and exit of the CBD.
Traffic flows for the heavily congested sections, estimated at 85,000 vehicles per day in 2007, have increased by 45 per cent, to an average of 123,000 per day, with a significant positive effect on the cost-benefit ratio.
More significantly, the highway led to a real estate boon on its shoulders as residential and commercial hubs sprung up.
The project birthed bedrooms along the road, as it snakes its way north to join the Thika-Garissa highway - so profound that with every interchange road at the highway on both sides leads to a settlement with real estate business booming.
Completion of the Thika superhighway in 2010 was decisive in marshalling demand for land and property along the road’s stretch, according to various real estate consultants.
Juja (which derived its name from two idols, ‘ju’ and ‘ja’ that were brought in the area during the colonial time) a small town that lies between Nairobi and Thika, has shrugged off the perception that the area is jinxed.
Its proximity to the eight-lane road has changed the town’s fortune.
According to real estate reports, since the construction of the highway, the asking price of land in Juja has been on an upward trajectory, pushing it to be among the most sought-after satellite towns around Nairobi.
The average price of an acre in Juja grew 12-fold since 2007 to about Sh10.6 million, according to real estate firm HassConsult.
Head of Research and Marketing Sakina Hassanali says the area has benefited from the comparatively reduced commuting time to the city.
“Juja is doing extremely well because it is served by an eight-lane road, which improves access to the area. Distance (between the towns and the city) is no longer about kilometers but is now about minutes taken,” Hassanali said.
Interestingly, the price increase has not discouraged migration to the area, as residential numbers have been rising significantly.
According to the 2019 Census, the population of Juja was 156,041 and that of neighbouring Ruiru 490,120, with the bulk of the population comprising youth in the age bracket of 20 and 35.
Johnson Denge, a lead real estate consultant and owner of Pep Real Estate Development Company, says the young population has pushed investors to build residential spaces.
“Along the superhighway, most real estate investments are residential, largely contributed to by the ever-growing number of people who live in towns like Ruiru, Juja and Roysambu but work in the CBD,” he said.
“Majority of these new places were built after the completion of the project.”
While population increases businesses boom, with small and medium enterprises hugely dominating the towns, the matatu industry stands out as the biggest beneficiary of them all.
A close check reveals that more than 20 matatu saccos have come up since the completion of the highway, more than three-fold the number that was operating before the road was built.
In 2012 there were only two tertiary institutions along the Nairobi-Thika highway, namely Kenyatta University and Jomo Kenyatta University of Agriculture, Science and Technology.
Now there are more than 11 private universities with campuses along the highway and many mid-level colleges cropping up.
This has given investors enough incentive to build cheap rental spaces for students that have swarmed the area.
“A large number of students forced me to change my rentals to bedsitters and hostels because I realised I can make more and the demand is huge due to the large number of schools in the neighbourhood,” said Susan Njaaga, a property owner in Kahawa Wendani.
Impressive real estate projects also came up after the completion of the highway, with Garden City, Thika Road Mall and Juja City as some of the landmarks.
As a government project, the value on return on Thika Road is hard to measure. However, the road has opened many avenues and continues to give the taxman significant revenue.
“The multiplier effect of this project has been huge. In fact, it is estimated that the amount invested along the highway is 60 per cent to 70 per cent more than what was loaned to construct the highway,” said seasoned economist Gerrishon Ikiara.
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