Real estate players including developers and financiers feel that buildings that fail on environmental, social, and governance (ESG) compliance risk being "irrelevant" in the future.

This emerged during the East Africa Property Investment (EAPI) summit, themed A Renewed Focus. The summit, said host Kfir Rusin, sought to provide an opportunity for leaders to plan their strategies based on a new set of increasingly entrenched and resilient fundamentals.

These fundamentals include continued improvements in infrastructure development and new statutory reforms in real estate and Nairobi and Rwanda’s Kigali establishing themselves as regional economic and innovation hubs.

Other factors include ESG principles driving investor, consumer and occupier behaviour and the government’s continued focus on initiating and implementing affordable housing projects.

In the meantime, different players in the commercial space continue to make their contributions to the real estate sector, but all with a focus on ESG compliance.

Absa Bank Head of Commercial Property Finance, Africa Region Somaya Joshua said more funding has been extended to Kenya across the real estate sectors including offices, retail, housing and industrial.

“We have increased interests in ESG projects and have had notable successes on qualifying structures in other locations where we’ve been able to structure specific milestones into transactions that, if met, may translate into a funding benefit to clients on a case-by-case basis.”