Cytonn Real Estate’s Research Assistant, Effie Otieno, talked about the challenges that faced the sector during the period under review. Ms Otieno mentioned lower purchasing power because of loss of jobs and travel restrictions occasioned by the pandemic as some of the major challenges.

“Business restructuring with some firms downsizing, constrained financing for developers, and, the existing oversupply in the commercial office and retail sectors, with a surplus of 6.3 mn SQFT and 2.0 mn SQFT, respectively,” Ms Otieno added.

In the residential sector, price appreciation in the market remained subdued with both detached units and apartments recording declines to (0.1%) during the quarter. Ridgeways, Runda Mumwe, and Thindigwa registered the highest capital appreciation at 3.0%, 2.6, and 2.3%, respectively.

According to the report, Gigiri, Westlands, and Karen were the best performing office nodes in Q3’2020 recording rental yields of 9.0%, 8.1%, and, 8.1%, respectively, attributed to the relatively good infrastructure mainly the road networks easing access to the areas and exclusivity of the areas with high-quality offices thus attracting high- end clients and premium rental prices.

In the retail sector, Westlands and Karen were the best performing nodes recording average rental yields of 9.7%, and 9.3%, respectively, attributed the residents’ high consumer purchasing power with the areas hosting high-end income earners.