Two brightly shinning buildings have given a formerly dull, shanty looking area of Nakawa 4kms from East of Kampala a new glossy look. For the last two years, it has been a construction site synonymous with several Chinese construction workers and Uganda from China Aero-technologic International Cooperation (CATIC).
The building; the Nakawa Business Park, will soon be open for business by the end of August. UAP Holdings and UAP Insurance, the owners, have sunk in an estimated US$30m. The 23,000 sq meters of office space in the building is part of UAP’s strategy to diversify their portfolio of investments.
Initially, UAP Holdings owns UAP Insurance and Financial Services had been reliant on investments on the Nairobi Securities Exchange (NSE), before they reversed their investment trend in 2011 to add real estate in order to boost their earnings in rental income.
Real estate, according to the company is booming in Uganda, Kenya and South Sudan, explaining why they ventured into this segment in the three countries. For UAP in Uganda, the investment is a stitch in time, as new regulations by the Insurance Regulatory Authority (IRA) require funds and earnings of insurance companies to be invested in country and real estate came as the natural option.
Other options included bank deposits, Mathew Koech, the previous UAP Insurance Uganda MD, considered to have low returns and being active on the Uganda Securities Exchange (USE), which is said to be still underdeveloped with limited liquidity. In a 2011 interview, Mathew Koech, told The CEO Magazine in an interview that “real estate on the other hand brings in more returns yet is less risky, making it a worthwhile investment area for us [UAP].
