KONZA TECHNO CITY STATUS UPDATE

By Catherine Adeya, PhD Ag. CEO, KOTDA konza@ict.go.ke November, 2013

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Konza & Vision 2030

Konza is a Vision 2030 flagship project to position Kenya as a leading ICT destination by leveraging and expanding Kenyas technology focused industries.
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KONZA

Vision Statement
Konza Techno City will be a sustainable, world-class technology hub and a major economic driver for the nation, with a vibrant mix of businesses, workers, residents, and urban amenities.
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KONZA VISION

At 5,000 acres, Konza is comparable to other world-class cities

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Konza will be positioned as a mid-density urban environment

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Investment Opportunities in Konza Techno City

Science Parks, BPO Centres, Data Centres. Commercial office space Hotels and Convention Centres Real Estate residential properties. Large scale commercial shopping malls e.g. Mall of Africa. Recreation and entertainment venues e.g. Sports Stadium. Film and Media Centre. Financial District. Community support services, including health, clinics, green space, educational institutions, houses of worship etc. University, Research Centre . Transportation Infrastructure. World class ICT infrastructure. Utilities, Roads and other infrastructure.
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Why KONZA
Create 200,000 jobs in BPO-ITES and
related sectors in 20 years.
Economic Benefits

World class infrastructure and

technology to facilitate research, education and business.

Kenya becomes a knowledge based

economy.

Higher quality of life

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Why KONZA Cont

Mixed urban development, class
Social Benefits

residential and working environment.

Enhance local R&D,

Entrepreneurship and IT enterprise formation culture.

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Project Profile
The Ministry of ICT, was spearheading the project, engaged International Finance Corporation (IFC) as the Transaction Advisor. IFC hired the Master Delivery Partner 1 (MDP1) in August 2012 to prepare a detailed economic development strategy and physical master plan for Phase 1 to be developed in the next five years (2013-2017)
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Profile

MDP1 was a multi-disciplinary team

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Master Delivery Partner 1 (MDP1)

MDP1 Hired Aug2012

to prepare a detailed economic development Strategy and Physical master plan for Phase 1 to be developed in the next five years (2013-2017)
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MDP1 Complete

MDP1 Assignment Complete (Aug 2012-Feb 2013)

Business and Governance

In progress

Vision + Mission

Sector Strategy Real Estate Strategy

Financial Strategy

Master Plan + Design

Action Plan

GoK Implementation

Local Physical Development Plan (LPDP)

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MDP1 Deliverables
Anchor Tenant Strategy. Local Physical Development Plan (LPDP). Physical Master Plan. Infrastructure Financing Plan. Business and Cash-Flow Plan. Governance plan for the Konza. Technopolis Development Authority (KOTDA).
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MDP1

MDP1 conducted intensive sector strategy and tenant outreach

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Potential Investors per Sector

SECTORS
Academia BPO/ITES Construction Energy Financial Services Healthcare Hospitality Infrastructure Life Sciences Manufacturing Real Estate Sports Telecom General Interests

NO. OF INTERESTS REG.D

17 14 19 3 34 5 10 6 11 5 64 5 28 94

TOTAL INVESTMENT INTERESTS

315

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Potential Investors per region

Region No. of Interests Regd. 253 21 13 15

Kenya Rest of Africa Middle East Europe

Asia

North America 3 South America 1 Invest in Silicon Savannah

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Phase 1 vision

Total development: Total workers: 22 Invest in Silicon Savannah Total residents:

1.5M m2 ~17,000 30,000

This Phase establishes a framework for the future growth of Konza

16,675
Direct jobs

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It will be built out over 400 acres of land.

Phase 1 Land Area
Mixed Use University Residential Life Science Phase 1 Office Retail Cultural/Community Vertical Development Subtotal Parks Transportation and Other Public Space 89 acres 39 acres 26 acres 26 acres 11 acres 8 acres 1 acre 201 acres 79 acres 130 acres

Total

410 acres

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The Phase integrates multiple program regions

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This Phase, with catalysts in place, could entail 1.5M m2 of total vertical development.
Civic and Flex: 14,000 m2 Office: 81,000m2

Upper income housing: 240,000m2 Studio1 bedroom: 420 units 24 bedrooms: 1,050 units

Lab: 35,000m2
Hospital: 50,000m2 Middle income housing: 660,000m2 Studio1 bedroom: 1,720 units 24 bedrooms: 4,400 units

University: 194,000m2 Lower income housing: 100,000m2 Studio1 bed: 510 units 24 bedrooms 1,300 units Hotel: 6,000 m2

Retail: 65,000m2
School: 44,000m2

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Program will be distributed throughout the Stitch on specialized bands connected by a mixed-use bar.

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Phase 1 Entry Plaza

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Phase 1 Office Band

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Phase 1 Science & Research Band

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Phase 1 Residential Band

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Phase 1 University Band

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MDP2
Procurement of MDP2 completed The two firms evaluated were: Tetra Tech, Inc (USA) Dar Al-Handasah Consultants (Lebanon) Tetra Tech won and announced by Ministerial Tender Committee (MTC) as the MDP2 awaiting signing Contract.
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Status

Brand & Market Konza

Public Realm Guidelines

Land leases

MDP2 ROLE
Building Parcel Guidelines

Capacity building & Organization Development for KOTDA

Design Management

Financial Analysis

Construction Management 39

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Role of MDP2
MDP2 will support the development plans of the Government of Kenya and the KOTDA through the implementation of Phase 1 of KTC.

MDP2 will supplement the capacity of KOTDA: 1) Creation of Branding and Marketing Campaign for KTC 2) Public Realm Guidelines and Building Parcel Guidelines 3) Land Lease Negotiations with Parcel Developers 4) Project Financial Analysis and Summary 5) Capacity Building and Organization Development for KOTDA 6) Design Management for Public Infrastructure 7) Construction Management for Public Infrastructure
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Konza Potential incentives

(started discussions with Treasury)

Potential financial policies Corporate income tax exemption Stamp duty exemption Employment-based grants Tax policy to encourage headquarters establishment VAT and duty-free import of materials for business purposes Revisions to existing depreciation policies Potential regulatory policies Expedited company incorporation One-stop shop Single window clearance Easing of restrictions on foreign ownership and employment
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Infrastructure will be financed by different entities, requiring key partnerships.

Project Finance

Infrastructure $1,060M

On-site $750M

KOTDA

Government of Kenya

Off-site $310M

Financing Entities

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Financing the on-site infrastructure requires PPP and non-PPP project types.
On-site KOTDA infrastructure
Type of projects Funding source
User fees

Financing Entity

PPP
$350M $750M
Government revenues KOTDA Land leases Service fees Local taxes Government revenues

Project Finance

Government

Non-PPP
$400M

Government

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Government will need to play a key role in infrastructure delivery

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KOTDA will sign land leases with vertical developers.

KOTDA 99 Year Land Lease Debt Banks Institutional Investors Developers equity 3rd party equity Investor

Land Lease Payment & Service Fees GoK Counties Taxes

Debt Vertical Developer Equity Equity

Taxes

Tenants

Tenant Attraction

Construction Contractor

EPC Contract
Target Uses Commercial Life Science

Property Management

Management Contract

Retail

Residential

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CONTACT US:
Konza Technopolis Development Authority (KOTDA) Telposta Towers, 10th Floor, Kenyatta Avenue P.O. Box 30519-00100 Nairobi, Kenya.

Telephone: Email: Website:

+254 020 4920230/221 konza@ict.go.ke www.konzacity.co.ke

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