Commercial Real Estate - Africa | Statista Market Forecast

The Commercial Real Estate market market in Africa is anticipated to achieve a significant milestone, with a projected value of US$2.63tn in 2024.
This impressive figure is expected to exhibit a steady growth rate of 3.97% annually from 2024 to 2029, resulting in a substantial market volume of US$3.20tn by 2029.
In the global landscape, the United States will continue to dominate the Real Estate market, generating the highest value of US$25.3tn in 2024.
This exemplifies the immense scale and potential of the Commercial Real Estate market market, both in Africa and worldwide.
The commercial real estate market in South Africa is experiencing a surge in demand due to the country's growing economy and increasing foreign investment.

Definition:

Commercial real estate can be defined as properties that are used for business purposes, such as office buildings, retail spaces, warehouses, and industrial properties.

Additional information:

The commercial real estate market contains the value of commercial properties as a key performance indicator. This is the worth of all office buildings, retail spaces warehouses, and industrial properties for the timeline of our data coverage.

Office buildings
Retail spaces
Warehouses
Industrial properties

Residential real estate
Publicly owned buildings used by the local government
Buildings used for public health care services

The Commercial Real Estate market in Africa is experiencing significant growth and development, driven by various factors such as increasing urbanization, population growth, and a growing middle class. Customer preferences in the Commercial Real Estate market in Africa are shifting towards modern and well-designed properties that offer a range of amenities and services. Customers are also seeking properties that are located in prime locations, close to major transportation hubs and business districts. Additionally, there is a growing demand for sustainable and environmentally-friendly buildings, as customers are becoming more conscious of the impact of their real estate choices on the environment. Trends in the market include the rise of mixed-use developments, which combine residential, commercial, and retail spaces in a single property. These developments are becoming increasingly popular as they offer convenience and a variety of options for customers. Another trend is the increasing investment in commercial real estate by foreign investors, who are attracted by the potential for high returns and the untapped market opportunities in Africa. Additionally, there is a growing trend towards the development of smart buildings, which utilize technology to enhance energy efficiency, security, and overall comfort for occupants. Local special circumstances in Africa's Commercial Real Estate market include the presence of informal and unregulated property markets in many countries. These informal markets often operate outside of formal legal frameworks and can pose challenges for investors and developers. However, they also present opportunities for growth and innovation, as they cater to the needs of a large segment of the population that may not have access to formal housing options. Additionally, political stability and government policies play a crucial role in shaping the commercial real estate market in Africa, with countries that have stable governments and investor-friendly policies attracting more investment and development. Underlying macroeconomic factors that are driving the development of the Commercial Real Estate market in Africa include economic growth, urbanization, and population growth. As economies in Africa continue to grow, more businesses are being established and expanding, creating a demand for commercial properties. Urbanization and population growth are also contributing to the demand for commercial real estate, as more people move to cities and require housing, offices, and retail spaces. Additionally, favorable demographic trends, such as a young and growing population, are creating a demand for various types of real estate, including commercial properties. In conclusion, the Commercial Real Estate market in Africa is experiencing growth and development due to factors such as increasing urbanization, population growth, and changing customer preferences. The market is characterized by a shift towards modern and well-designed properties, the rise of mixed-use developments, and the increasing investment by foreign investors. Local special circumstances include the presence of informal property markets and the importance of political stability and government policies. Underlying macroeconomic factors driving the market include economic growth, urbanization, and population growth.

Data coverage:

Figures are based on value of commercial real estate.

Modeling approach / Market size:

Market sizes are determined by a bottom-up approach. As a basis for evaluating this market, we use national statistical offices. Next, we use relevant key market indicators and data from country-specific associations such as share of industry, manufacturing, and services of the GPD, price level index, GDP. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the market, for example, exponential trend smoothing.

Additional Notes:

The market is updated twice per year in case market dynamics change. The impacts of the Russia-Ukraine war are considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

After a challenging period during the coronavirus pandemic, the European commercial real estate sector now faces additional pressures, including inflation, record-high interest rates, and sluggish economic growth. In 2022, these challenges were evident through contracting investment volumes in the two largest markets—the United Kingdom and Germany. Although the shifting economic landscape has impacted all commercial real estate subsectors, industrial and logistics—a property type that demonstrated incredible resilience during the pandemic—continues to be the most popular investment class. The performance of the sector is closely tied to the state of the economy, explaining why cities with flourishing capital markets garner the most interest from investors. In 2023, investors identified London, Paris, and Madrid as the three most attractive markets.

Growing demand for industrial and logistic real estate is prominent in Europe, driven by the increase in online retail sales rather than in-store. All the Nordic countries saw steady growth in their e-commerce sales during the past fifteen years and more, and the growth is expected to continue. Investments in the industrial and logistic real estate industry have generally been at a higher level during the last few years. The highest investment value among European countries in the first half of 2021 was in the United Kingdom, while Sweden topped the list among the Nordic countries, and was fifth in terms of industrial and logistics investment in real estate in Europe that year.