Real Estate & Construction

South Africa’s real estate sector felt the full force of the global economic crisis in 2008. The sector has been hit by a lack of demand stemming from weakened consumer confidence, rising inflation and obstacles to credit growth. However, the market is benefitting from the growth in urban middle-class consumers, a fact reflected in the emerging property supply and prices. South Africa’s young, and increasingly wealthy, population should offer many opportunities for investors and developers in all facets of the real estate sector in the next decade. The construction sector remains a critical component of the economy. The contribution of the sector to GDP was estimated at 3.2% in 2010. However, as the economy slowed and the flow of work linked to the hosting of the FIFA event dried up, growth came to an abrupt halt and contractors were left to make do with a dwindling list of projects. Developer caution persists, suggesting that this trend may remain for some time. As such, contractors are looking to the government and its ambitious infrastructure programme for future work. This chapter contains an interview with Samuel Ogbu, Chief Executive, Liberty Group Properties.