Developers investing $514bn in new city projects in Africa

A new report by Estate Intel reveals that African governments and private developers are collectively investing over $514 billion in new city development projects across the continent. The aim of these projects is to address the challenge of urban overpopulation by creating new economic hubs and reducing congestion in major urban centers such as Lagos, Cairo, and Nairobi. CNBC Africa's Julius Bizimungu interviewed Oladapo Runsewe, Senior Research Analyst at Estate Intel, to delve into the key findings of the report. One of the standout aspects of the report is the sheer scale of the new cities being constructed in Africa. With almost 2 billion square meters of space being developed, equivalent to approximately 2,000 square kilometers, these projects signify a significant effort to support economic growth and alleviate the strain on existing urban infrastructure. Runsewe highlighted the monumental task of transforming this vast expanse into livable spaces that can attract residents and foster economic activity. The staggering cost of $514 billion for these new city projects raised eyebrows, with Runsewe explaining the factors driving such high expenses. Land acquisition, infrastructure development, and the reliance on imported construction materials all contribute to the exorbitant costs. The need to build essential amenities such as roads, water systems, sewage networks, and electricity grids further escalates the financial burden on developers and governments involved in these ambitious undertakings. North Africa emerged as a focal point for new city projects, accounting for more than 88% of all ongoing developments across the continent. Egypt, in particular, has taken the lead in constructing new cities to alleviate the overpopulation and congestion in Cairo. The Egyptian government's commitment to building 13 new cities, including the new administrative capital, reflects a strategic effort to decentralize the population and ease the strain on existing urban infrastructure. The push for new city projects in Africa stems from the dual pressures of urban overpopulation and housing shortages. With urban population growth projected to exceed 60% in the coming years, cities like Lagos, Cairo, and Nairobi are grappling with overcrowding and inadequate housing supply. The strain on public resources, including utilities like water, sewage, and electricity, diminishes the quality of life for residents and underscores the need for decongestion and urban decentralization. Efforts to enhance the quality of life index in African cities, akin to Cape Town's top ranking in the continent but lower global standing, hinge on efficient infrastructure, green spaces, and quality amenities. By dispersing populations, creating economic opportunities in newly developed cities, and improving access to essential services, African governments and private developers aim to elevate the living standards and well-being of urban dwellers across the continent.