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Rank: Veteran Joined: 11/13/2015 Posts: 1,654
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nairobby wrote:VituVingiSana wrote:nairobby wrote:VituVingiSana wrote:Only 7 floors? Seems a waste given the land cost is fixed. Unless the design allows for further vertical expansion in the future. IMHO, probably poor ROI on owning the building vs leasing it. Office space is available all over the place. Or it could be a vanity project. Vanity perhaps. However I think the building is strategically located and may do better than other commercial buildings at attracting tenants. Plus by the time they set all this in motion it was years ago when property was still booming. Just 7 floors seems a vanity project. The much older Kenyatta Ave building is much taller. There's no mention of the cost of the property but I wonder that the ROI is given 25-year T-Bonds pay 12.6% tax-free. Let's say it cost them KES 1.5bn including the land that's an opportunity cost 190mn/year (before rent from other tenants). I agree. Don't they also have a building in Upperhill? I don't see vanity more of self-actualization. Nairobi Asian community is also at this stage of self-actualization. You can see it from the ongoing densification of parklands and westlands into a more mixed use area. The ongoing road works like Ring road parklands into westlands means they don't need to come to CBD or upperhill. It's more strategic to be located in that area to serve it's major clientele.
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Rank: Chief Joined: 1/3/2007 Posts: 18,346 Location: Nairobi
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wukan wrote:nairobby wrote:VituVingiSana wrote:nairobby wrote:VituVingiSana wrote:Only 7 floors? Seems a waste given the land cost is fixed. Unless the design allows for further vertical expansion in the future. IMHO, probably poor ROI on owning the building vs leasing it. Office space is available all over the place. Or it could be a vanity project. Vanity perhaps. However I think the building is strategically located and may do better than other commercial buildings at attracting tenants. Plus by the time they set all this in motion it was years ago when property was still booming. Just 7 floors seems a vanity project. The much older Kenyatta Ave building is much taller. There's no mention of the cost of the property but I wonder that the ROI is given 25-year T-Bonds pay 12.6% tax-free. Let's say it cost them KES 1.5bn including the land that's an opportunity cost 190mn/year (before rent from other tenants). I agree. Don't they also have a building in Upperhill? I don't see vanity more of self-actualization. Nairobi Asian community is also at this stage of self-actualization. You can see it from the ongoing densification of parklands and westlands into a more mixed use area. The ongoing road works like Ring road parklands into westlands means they don't need to come to CBD or upperhill. It's more strategic to be located in that area to serve it's major clientele. Self-what? Equity - Upper Hill. Nowhere close to its roots. KCB - Upper Hill NBK - CBD BBK/Absa - Westlands SCBK - Westlands Stanbic - Westlands ABC - Westlands Prime - Kileleshwa/Westlands Victoria -Upper Hill (or is it Two Rivers?) Family - ? CBA - CBD (or Westlands?) The directors should self-whatever on their own dime not on the shareholders dime. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 12/4/2009 Posts: 10,804 Location: NAIROBI
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VituVingiSana wrote:wukan wrote:nairobby wrote:VituVingiSana wrote:nairobby wrote:VituVingiSana wrote:Only 7 floors? Seems a waste given the land cost is fixed. Unless the design allows for further vertical expansion in the future. IMHO, probably poor ROI on owning the building vs leasing it. Office space is available all over the place. Or it could be a vanity project. Vanity perhaps. However I think the building is strategically located and may do better than other commercial buildings at attracting tenants. Plus by the time they set all this in motion it was years ago when property was still booming. Just 7 floors seems a vanity project. The much older Kenyatta Ave building is much taller. There's no mention of the cost of the property but I wonder that the ROI is given 25-year T-Bonds pay 12.6% tax-free. Let's say it cost them KES 1.5bn including the land that's an opportunity cost 190mn/year (before rent from other tenants). I agree. Don't they also have a building in Upperhill? I don't see vanity more of self-actualization. Nairobi Asian community is also at this stage of self-actualization. You can see it from the ongoing densification of parklands and westlands into a more mixed use area. The ongoing road works like Ring road parklands into westlands means they don't need to come to CBD or upperhill. It's more strategic to be located in that area to serve it's major clientele. Self-what? Equity - Upper Hill. Nowhere close to its roots. KCB - Upper Hill NBK - CBD BBK/Absa - Westlands SCBK - Westlands Stanbic - Westlands ABC - Westlands Prime - Kileleshwa/Westlands Victoria -Upper Hill (or is it Two Rivers?) Family - ? CBA - CBD (or Westlands?) The directors should self-whatever on their own dime not on the shareholders dime. @vvs What he meant is that I&M being a primarily Asian bank is relocating close to where it's clientele and owners are. KCB,NBK,Stanbic,BBK are more local. Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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Ericsson wrote:VituVingiSana wrote:wukan wrote:nairobby wrote:VituVingiSana wrote:nairobby wrote:VituVingiSana wrote:Only 7 floors? Seems a waste given the land cost is fixed. Unless the design allows for further vertical expansion in the future. IMHO, probably poor ROI on owning the building vs leasing it. Office space is available all over the place. Or it could be a vanity project. Vanity perhaps. However I think the building is strategically located and may do better than other commercial buildings at attracting tenants. Plus by the time they set all this in motion it was years ago when property was still booming. Just 7 floors seems a vanity project. The much older Kenyatta Ave building is much taller. There's no mention of the cost of the property but I wonder that the ROI is given 25-year T-Bonds pay 12.6% tax-free. Let's say it cost them KES 1.5bn including the land that's an opportunity cost 190mn/year (before rent from other tenants). I agree. Don't they also have a building in Upperhill? I don't see vanity more of self-actualization. Nairobi Asian community is also at this stage of self-actualization. You can see it from the ongoing densification of parklands and westlands into a more mixed use area. The ongoing road works like Ring road parklands into westlands means they don't need to come to CBD or upperhill. It's more strategic to be located in that area to serve it's major clientele. Self-what? Equity - Upper Hill. Nowhere close to its roots. KCB - Upper Hill NBK - CBD BBK/Absa - Westlands SCBK - Westlands Stanbic - Westlands ABC - Westlands Prime - Kileleshwa/Westlands Victoria -Upper Hill (or is it Two Rivers?) Family - ? CBA - CBD (or Westlands?) The directors should self-whatever on their own dime not on the shareholders dime. @vvs What he meant is that I&M being a primarily Asian bank is relocating close to where it's clientele and owners are. KCB,NBK,Stanbic,BBK are more local. I&M is becoming less Asian, more cosmopolitan. Life is short. Live passionately.
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Rank: Veteran Joined: 11/13/2015 Posts: 1,654
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sparkly wrote:Ericsson wrote:VituVingiSana wrote:wukan wrote:nairobby wrote:VituVingiSana wrote:nairobby wrote:VituVingiSana wrote:Only 7 floors? Seems a waste given the land cost is fixed. Unless the design allows for further vertical expansion in the future. IMHO, probably poor ROI on owning the building vs leasing it. Office space is available all over the place. Or it could be a vanity project. Vanity perhaps. However I think the building is strategically located and may do better than other commercial buildings at attracting tenants. Plus by the time they set all this in motion it was years ago when property was still booming. Just 7 floors seems a vanity project. The much older Kenyatta Ave building is much taller. There's no mention of the cost of the property but I wonder that the ROI is given 25-year T-Bonds pay 12.6% tax-free. Let's say it cost them KES 1.5bn including the land that's an opportunity cost 190mn/year (before rent from other tenants). I agree. Don't they also have a building in Upperhill? I don't see vanity more of self-actualization. Nairobi Asian community is also at this stage of self-actualization. You can see it from the ongoing densification of parklands and westlands into a more mixed use area. The ongoing road works like Ring road parklands into westlands means they don't need to come to CBD or upperhill. It's more strategic to be located in that area to serve it's major clientele. Self-what? Equity - Upper Hill. Nowhere close to its roots. KCB - Upper Hill NBK - CBD BBK/Absa - Westlands SCBK - Westlands Stanbic - Westlands ABC - Westlands Prime - Kileleshwa/Westlands Victoria -Upper Hill (or is it Two Rivers?) Family - ? CBA - CBD (or Westlands?) The directors should self-whatever on their own dime not on the shareholders dime. @vvs What he meant is that I&M being a primarily Asian bank is relocating close to where it's clientele and owners are. KCB,NBK,Stanbic,BBK are more local. I&M is becoming less Asian, more cosmopolitan. Pareto principle 80% of income will come from 20% of clients. The 20% clients are the ones who need to go the Bank HQ. This is just optimal allocation of resources.
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Rank: Chief Joined: 1/3/2007 Posts: 18,346 Location: Nairobi
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Ngai! I was just talking of the ROI on an example of a 1.5bn (500mn/acre + 1bn construction) building. Regardless of where it is, I was talking of the economics of it. Whether I&M has their HQ in Parklands, Westlands, CBD, Upper Hill or Konza, I find the "opportunity" cost very high if they own it. I believe Equity leases most of their space including the HQ in Upper Hill. In some spots, given they lease the space, they have reduced the footprint as Equity pushes the digital and agency channels. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 12/4/2009 Posts: 10,804 Location: NAIROBI
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VituVingiSana wrote:Ngai!
I was just talking of the ROI on an example of a 1.5bn (500mn/acre + 1bn construction) building.
Regardless of where it is, I was talking of the economics of it.
Whether I&M has their HQ in Parklands, Westlands, CBD, Upper Hill or Konza, I find the "opportunity" cost very high if they own it.
I believe Equity leases most of their space including the HQ in Upper Hill.
In some spots, given they lease the space, they have reduced the footprint as Equity pushes the digital and agency channels. The opportunity cost is very high owning it,but at the back of your head know there is some influential person benefitting/being rewarded. Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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