Super-rich Kenyans explored new avenues to multiply their wealth from the start of the 2022 financial year.
With Kenyans learning the most common ways of gaining wealth, bourgeoisies channeled their investments in different sectors which paid off by the end of the fourth quarter in 2022.
Among the new ways they explored to gain wealth included purpose-built student accommodation (PBSA), Non-Fungible Tokens (NFT), collectible arts, Public-Private Partnerships (PPP) and even in wines.The luxury investment index beat fast movers in the market, such as flashy cars and posh apartments.
Purpose-built student accommodation (PBSA)
According to Knight Frank, a real estate agents and managers company, investments in purpose-built student accommodation (PBSA) performed better in Kenya than residential apartments.
According to Knight Frank’s 2022 Second Half report, organised student hostels attracted 8 per cent returns compared to 4 per cent collected from residential apartments in the real estate sector.
Dollar millionaires in Kenya shifted to purpose-built student accommodation due to the increasing demands for student accommodation, thus building hostels in Northlands, Hurligham, Parklands and even areas adjacent to Kenyatta University.
“It is expected that PBSA will remain more profitable in the foreseeable future as universities (public and private) struggle to accommodate the ever-increasing number of students,” the report projected.
Public Private Partnership (PPP)
Tycoons in Kenya who are well-connected and affluent have also increased their money through P3s (PPP).
An agreement between the public and private sectors to plan, develop, fund, and even build a specific project is known as a PPP. Kenyans with private businesses make agreements with the government to finance particular projects, and they later recoup the money.
Due to the rising demand for reasonably priced services in transportation, water, sewage, telecommunication, and social services, PPP gained traction in Kenya.
Non-Fungible Tokens
Non-fungible Tokens are cryptocurrency-based tokens that represent unique assets like works of art, media, or digital content.
In 2022, the Knight Frank intelligence lab predicted that sales of Non-Fungible Tokens (NFT) would soar.
According to a report by Knight Frank, “the younger generations, who are known to be more tech-savvy and the most educated, find the NFT art marketplace especially appealing due to the rising and unpredictable prices. This is exciting for them as it is an opportunity to flip the collectibles into profits digitally while being untraceable.
Luxury Drinks
According to a Visual Capitalist analysis titled The World’s Billionaires by Generation published in 2022, 9% of the world’s ultra-wealthy invest in the food and beverage sector.
According to the paper, the move was brought on by the restricted supply of burgundy and champagne and their exponentially rising demand.
“Many individuals today are interested in wine as an investment decision either to make money or for later consumption. Kenyans are now more knowledgeable than ever about wine. We import more types of wine than any other nation in Africa, “A wine specialist said.
Buying Shares
The nation’s super wealthy also made a decision to invest in shares in underperforming businesses that would treble their returns by the conclusion of the 2022 fiscal year.
Bond trading saw an increase during the same time frame. The pandemic’s devastating impacts, which led to the closure of numerous businesses, were the cause of the transition.
Luxury Watches
The Visual Capitalist research on other valuable arts revealed that affluent investors have purchased expensive watches. At an auction market, vintage timepieces fetch twice as much money, according to a 2019 New York Times story.
According to the study, some businesses are letting customers buy limited-edition, uncommon timepieces for discounts of up to 50% off of regular costs.
Ex-Mombasa Governor Ali Hassan Joho, ex-Interior Cabinet Secretary Fred Matiang’i, and ex-National Treasury CS Henry Rotich were all spotted in Kenya sporting pricey wristwatches.
