Broll Ghana has urged local investors and financial institutions to exploit syndicated capital to finance shopping malls in the country.

The firm said it has identified shopping malls as one of the lucrative investment schemes that financial institutions and Ghanaian investors must pay attention to by pooling resources.

The Chief Executive of Broll Ghana, Kofi Ampong, said his firm has decided to promote local investment in retail development based on the competitive income and capital returns from this sector.

He explained that developments in the economy which have resulted in the emergence of a middle-income class, taste for luxury goods, influx of foreign investors and a maturing property market, have also opened the window to invest in retail developments.

“It’s a fact that many of our financial institutions here invest heavily in fixed-income securities -- Ghana Government Bonds, Treasury bills, etc. because these are perceived as safe investments with minimal risk and assumed to provide, arguably, a decent rate of return. However, it is worthy to note that there are other forms of investments locally that appear relatively lucrative but which we have not paid particular attention to.

“It is for this reason that I introduce to you other investment opportunities in shopping malls.

“Our direct involvement in retail broking services and retail management has brought to the fore enormous opportunities that the majority of us are not taking advantage of, and which we would like to recommend to the financial institutions.

“The prospects are good as the rental rates and yields are far better than Offices/Industrial Properties,” he said.

Broll Ghana is presently the leader in the property management business and real-estate market research. The firm is involved in the leasing of top-rated retail and office space in locations like Movenpick Hotel, the office component of the new Stanbic Heights.

It is also actively involved in providing varying real-estate services to some upcoming developments like West Hills Mall, Achimota Mall, The Junction Mall, Meridian Mall, The Exchange and Accra Water Front.

The push for investment in shopping malls follows the recent release of MasterCard African Cities Growth Index, which identified Accra as the sub-Saharan African city with the highest potential for growth over the next five years.

According to Mr. Ampong, retail properties in Ghana are commanding rental rates of between US$7 – US$25m2 per month exclusive of service charge.

He said prime retail properties in Accra, which are principally neighborhood and Community Shopping Centres, however command the higher bracket for rental rates of between US$25 – US$55m2 per month, with service charges for retail properties ranging between 10% and 20% of the rent price.

“That notwithstanding, anchor tenants generally are able to negotiate relatively lower rates than the above rentals. This is mainly due to the fact that they occupy larger space (usually more than 1,000m2) and have the ability to draw a lot of foot traffic, thus resulting in increased visits to the Centre to the benefit of the line tenants,” he said.

Mr. Ampong said the prospects and environment necessary for retail development are attractive in the Ghanaian economy, which has informed other developers and investors to “seriously” consider the country as many developers look for opportunities in emerging markets.

“The market is seeing interests from the Middle East, Spain, Turkey and France. Great retailers such as Azadea, Landmark, Alhokair, Casino Groupe, CFAO etc. have their eyes on Ghana. What this means is brands such as Zara, Mango, Splash, Debenhams, Marks and Spencer etc. will be coming to play in our market,” he added.