It’s not only popes and presidents who visited Nairobi in 2015 – growth in trade and industry is bringing in business travellers too, reports Business Traveller UK’s Jenny Southan.
Security is tight as I arrive at the Kenyatta International Conference Centre (KICC) – we are stopped at the gates while guards search the jeep, scan underneath it and ask who I am meeting. After a couple of calls I am able to walk through the airport-style metal detector to the car park, where my contact is waiting.
Extra precautions are being taken as President Uhuru Kenyatta (son of former premier Jomo Kenyatta, after whom the center is named) is paying a visit. I’m here to interview Fred Simiyu, the KICC’s managing director, but am spontaneously whisked into one of the auditoriums to hear the president speak at the Forum for Young Women Entrepreneurs.
The room is bedecked in the red, black, white and green of the Kenyan flag, with many panellists in elegant co-ordinating power outfits.
“If you think you have an idea that you haven’t fully exploited that could be a business, there is no better time than today and no better enabling government – turn that passion into something,” says one. The room breaks into applause.
Next up is the president. “We will continue to do everything that we can to create an environment for women, for young people, for all Kenyans, to be able to achieve their dreams and their aspirations,” he says. “We can grow this country, we can grow this economy, and you are in the right place to do just that.”
The forum, which took place in July, was one of many business gatherings hosted in Nairobi in 2015 – in November, the city welcomed the World Public Relations Forum, and in December the World Trade Organisation ministerial conference. In July, it held the China Trade Week Expo and the Global Entrepreneurship Summit, the latter of which made headlines worldwide when US
President Barack Obama flew in to speak.
It was the first time a sitting US president had visited the country, and Obama proudly declared: “I’m the first Kenyan-American to be president of the United States.”
Addressing a 5,000-strong crowd, he warned that the country had to confront certain issues if it wanted to move forward – particularly gender equality, and the “cancer” of corruption that is costing the country 250,000 jobs a year.
“It’s an anchor that weighs you down and prevents you from achieving what you could,” he said.
HUSTLE AND BUSTLE
Nairobi is a complex city – and a highly congested one. One afternoon it takes me two and a half hours to travel less than five kilometres from Upper Hill to the Kempinski Villa Rosa hotel. Without my laptop, I people- watch through the window. One woman fries fish at the side of the road, while another passes with a full bin liner knotted and balanced on her head as she texts on her phone with two hands. Men walk between cars selling oranges, magazines and cooking knives with flashing blades. Stalls hawk sugar cane, Tupperware and barbecued maize, while posters along walls read: “Call Dr Lulu for Love Potions, Business Boost, Man Power and Family Affairs.”
With a population of four million – about half of them living in slums – people know how to hustle. One of my guides, Antony Odhiambo from Gamewatchers Safaris, estimates that the average slum dweller earns KSh 4,000 ($40) a month. Everywhere you go, traders are working at the side of the road – from furniture builders to plant sellers (Kenya supplies 35% of cut flowers to the EU).
There’s wealth here, too. Odhiambo says: “You also have very rich people living in the slums. They were born there, then started a business and got rich, but stayed because it was their home.”
In 2013, Capgemini’s World Wealth Report said that the number of dollar millionaires in Nairobi was expected to grow by 62% from about 5,000 to more than 8,000 by 2020. You only have to pass through the suburb of Karen to get a sense of how the other half live, in mansions behind walls fringed with barbed wire.
GOOD FOR GROWTH
According to Moses Ikiara managing director of the Kenya Investment Authority, the country’s Vision 2030 development strategy “aims to transform Kenya into a newly industrialising, middle-income country providing a high quality of life to all its citizens”. It also wants to make sure no-one is living below the poverty line, with the average income per Kenyan projected to be at least $3,000 a year.
According to the World Bank, Kenya’s economic growth was 5.4% in 2014 – it was expected to hit 6% in 2015 and 6.6% this year. The country relies heavily on agriculture (27% of GDP), but the export of textiles, coffee, tobacco, iron, steel, cement and petroleum products are also key contributors. Areas with high potential include real estate, transport services, ICT and energy.
Multinational companies with regional headquarters in the capital include Barclays Bank, Coca-Cola, General Motors, General Electric, IBM, Unilever and Vodafone, along with Google, which announced in 2015 that it would be investing in Kenya’s $700 million Lake Turkana Wind Power Project. PwC and McKinsey opened offices in the Westlands district in 2014, while Wrigley is building a $63 million factory in Machakos County, south-east of the city.
US expat Annie Roberts left the Boston Consulting Group to set up her own company here, Open Capital Advisors, in 2010. The idea was to help rapidly growing small and medium-sized enterprises get funding between $50,000 and $5 million. Her team has expanded from three staff to 36, she tells me, so it will shortly be relocating to bigger premises.
“We also have a graduate recruitment programme – this time last year we had 600 applicants but could only hire six,” she said.
The main challenge Roberts has observed is finding senior-level talent.
“It’s easy to fill junior positions but it is hard to find folks with five to 15 years of experience,” she says. “The returning diaspora have so many opportunities, they demand really high salaries.”
Although Open Capital Advisors is only able to work with 10 to 15% of companies that would like its support, most of the ones it chooses are ethically minded. Two of her favourite success stories are Honey Care Africa, which provides farmers with beehives, and Miliki Afya, which is bringing high-quality, low-cost health clinics to cities across Africa, India, Pakistan and (soon) Latin America.
What about tech start-ups? Roberts says: “Fundamentally, apps are amazing but there is still such a need for basic goods and services here – until recently, cardboard boxes had to be imported from the Middle East.” Still, she adds: “I think we are going to see a rapid change in the next few years – the fact that smartphones have gone from $900 to $50 means that soon they will be available for $20 and, as incomes go up, you are going to get to that sweet spot.”
Already on the case is Nairobi’s innovation lab, iHub – a hotspot for software developers and digital entrepreneurs. In July, the launch of IBM’s Innovation Space@iHub was announced at the Global Entrepreneurship Summit as a way to boost new tech ventures.
BARRIERS TO BUSINESS
It’s not all rosy. In 2015 the World Bank ranked Kenya a lowly 136th out of 189 countries for ease of doing business. Roberts says it took her a month to set up her company, which could have been worse, but “in Delaware you can set up a company in six hours”. Finding reliable suppliers can also be tough and contracts aren’t always honoured. “With its colonial status, the legal system in Kenya looks similar to the UK, but you are just never really sure what will be enforced,” she says.
Terrorism, sadly, has become an ongoing fear. Since the Westgate shopping mall attack by Somali militant group Al Shabaab in 2013, parts of Kenya and Nairobi have been on high alert, with travel advisories against all but essential travel by UK and US citizens. In the capital, the Foreign and Commonwealth Office now only warns against going to the Eastleigh district, which has a large Somali population.
Most people on the ground are emphatic that it is no less safe than any other big city, although it’s better to use a hotel cab than hail a taxi or walk around at night. (You could also try Uber, which came online in January 2015.)
Good news for business travellers is the growth in international hotels.
“Last time we counted, we had more than 8,000 four- to five-star rooms,” the KICC’s Simiyu says.
Joining properties such as the InterContinental, Hilton and Fairmont the Norfolk is the 200-room Villa Rosa Kempinski. Opened in 2013, it has one of Africa’s top presidential suites (Obama likely stayed here). Other competitors include the five-year-old Sankara, which has 156 rooms, a pool, a champagne bar and a steakhouse, and the funky dusitD2, which opened in March 2015 with 101 rooms. Michael Metaxas, its general manager, says: “Development in Nairobi is booming. When I lived here 15 years ago you hardly saw anything more than one storey high. But now the horizon is impressive.”
A 271-room Radisson Blu opened in late-2015 with a large terrace and pool and a ballroom. “This will be our flagship property in Africa,” says general manager Jens Brandin. Rezidor will add a Park Inn by Radisson in Westlands this year and a Radisson Residence in 2017. Marriott, Moevenpick and Tune are also rumoured to arrive. Needless to say, there are plenty of options for business travelers.
UPPER HILL AND WESTLANDS PROSPER
The last few years have seen a continuous trend of corporates moving out of the Nairobi CBD, and as a result, the international hotel brands have followed suit.
One of the suburbs to benefit has been Upper Hill, home now to a number of multinational offices, quality hotels and a new and improved road.
“The roads project has brought a new dimension to the area, which is fast becoming the new finance and business hub of Nairobi,” says Allan Clingham, general manager of the Crowne Plaza. “It boasts beautiful walkways and street lights to enhance safety and security, and the main roads leading in and out of Upper Hill are dual carriageway.”
The Crowne Plaza dominated the Upper Hill hotel scene until recently, with a new Radisson Blu opening just a few kilometres away in late-2015.
No surprise then that the Crowne Plaza has ‘upped’ its game by upgrading its foyer area, the Alabaster Coffee Lounge and the Baraka Restaurant. At the Baraka Restaurant they have closed the pool and created an outdoor seated area with a water feature. A new swimming pool adjoining the gym has also been built.
The owners of the Crowne Plaza clearly see huge potential in Upper Hill and a couple of years ago decided to construct a 14-storey mixed-use development with 6,000m2 of office space, 44 new hotel bedrooms, an additional restaurant, conference facilities, and an extra 120 parking bays.
“The concept of ‘hotel-inspired’ working was the thinking behind the mixed-used concept, offering the tenants all the facilities of a modern four-star hotel, such as fitness facilities, food and beverage, conferencing, and other amenities,” says Clingham. “With multinational corporations moving their headquarters to Nairobi, we saw a need to provide grade A office space, additional parking, and additional hotel rooms to meet with expected future demand.”
Rounding off the broader Upper Hill hotel offering are the Fairview, the Town Lodge, and the Best Western. The Fairview is a homely four-star hotel owned by South African group City Lodge, with the Town Lodge – previously the Country Lodge – adjacent to it. The Best Western Premier opened in 2013 – the international group’s first property in Nairobi – and offers 96 four-star rooms in Upper Hill Estate, with free wi-fi, a health club and three restaurants.
“Upper Hill reminds me of the Sandton node 30 years ago, when the deterioration of the Johannesburg CBD forced the financial institutions and big businesses to find a new node, resulting in Sandton becoming the new financial hub of South Africa,” says Clingham. “This is currently happening in Upper Hill, due to the congestion in the CBD of Nairobi.”
Roughly five kilometres away you will find Westlands, the scene of the deadly mall attack in 2013. Despite that dark day, Westlands remains another emerging and popular node, with the last five years seeing three five-star hotels open in the area, in the form of the Sankara, the Villa Rosa Kempinski, and the dusitD2.
“In recent years we have seen a number of big players moving out of the CBD to Westlands,” says James Scott, director of sales and marketing at dusitD2 Nairobi. “We see this trend continuing and that the demand for five-star hotel rooms will remain for the foreseeable future. Naturally this will lead to increased competition for the existing hotels, but fantastic news for the business traveller.”
As with Upper Hill, though, increased competition means lifting one’s game, and the dusit property increased its conference space in the first year of operation and is adding a multi-purpose conferencing and banqueting venue, which is currently under development and expected to open in the third quarter of 2016.
On 1 September 2015 Kenya stopped issuing visas on arrival. Visitors are now required to purchase a visa online in advance of travel and will be asked to produce a printed copy of the e-Visa upon check-in, without which they will not be permitted entry into Kenya. Alternatively, travellers can also contact their nearest Kenyan embassy, high commission or consulate to arrange a visa. Travel agents or tour operators will be able to register and make visa applications on their clients’ behalf. An e-Visa will be valid for 90 days from the date of approval and not from the date of arrival in Kenya. Visit www.evisa.go.ke.
NAIROBI’S MAIN AIRPORT
East Africa’s regional hub, Jomo Kenyatta International (JKIA), is about 50 minutes’ drive from downtown, traffic permitting. Since the arrivals terminal caught fire in 2013, a temporary facility has been created in the ground level of the JKIA parking garage. Kenya Airways’ Terminal 1A opened in 2014, and the new Chinese-made prefab Terminal 2, which has an annual passenger capacity of 2.5 million, was unveiled in May 2015. It is being used for international and domestic flights for about five to seven years until a bigger, better facility is opened. (Terminal 1D, which it replaced, is being revamped in the meantime.) The largest terminal in Africa, T3, is set to be completed in 2018 with space for 20 million people a year (from 7.5 million today). Also added at the end of 2014 were two new lounges – Pride and Simba – in Terminal 1, for Kenya Airways Premier World and Sky Priority passengers from SkyTeam partner airlines. Both lounges offer free wi-fi, a sound-proof transit passenger sleeping area, dining lounge, washrooms and showers. The airport has numerous taxis and car rental services that operate 24 hours a day. A taxi ride to the city centre will cost you between $25 and $40. You can use your Visa, MasterCard and Maestro cards to draw money from ATMs available at the airport. There are also 24-hour banking services and forex bureaux.
Kenya Airways has an extensive route network and offers connections from JKIA to most major African cities. It also offers direct services to the likes of France, the Netherlands and the UK in Europe, China, Vietnam and Thailand in Asia, India and Dubai, whilst Jambojet, KQ’s low-cost subsidiary, flies to Mombasa, Kisumu, Eldoret, Malindi, Lamu and Ukunda in Kenya.
Fellow African big-hitters, SAA and Ethiopian Airlines, also fly in to Nairobi, whilst alternative European connections are provided by the likes of BA, Turkish Airlines, Lufthansa, SWISS, Air France and KLM. No surprise that Emirates, Etihad and Qatar Airways also all have Nairobi routes.
Significantly, though, Nairobi now has a low-cost link, with March seeing fastjet increase the number of flights on its route between Dar es Salaam in Tanzania and Nairobi in response to strong passenger demand. Fastjet now offers two daily return flights between each city every day of the week, making a total of 28 flights per week between Dar es Salaam’s Julius Nyerere International Airport and JKIA.
“We have always promised to increase the frequency on our route between Dar es Salaam and Nairobi as consumer demand grew for our affordable, safe, quick and on-time service,” said Richard Bodin, fastjet’s chief commercial officer. “The combined Dar es Salaam and Nairobi population of over eight million people was previously subjected to high air fares that we believe excluded large percentages of them from air travel, but now they have a real and affordable choice of airline.”
Fares start at $80 one-way, excluding taxes ($49 departing Tanzania and $40 departing Kenya).