GRAEME REID
Making Tilisi Developments Sustainable and Inclusive
Graeme Reid’s remarkable journey as CEO of Tilisi Developments has been delightful. His decision to embark on this path was rooted in a lifelong involvement in development, beginning with his dedicated work in the NGO sector. Amid the transformative era following apartheid in South Africa, he collaborated with trade unions and civic movements. In 1994, his journey took a significant turn as he assumed a pivotal role in the metropolitan council post-democratic elections, spearheading impactful projects with a primary emphasis on the rejuvenation of downtown Johannesburg. His dedication extended to historically underserved areas of Johannesburg, such as Soweto.
“Subsequently, I transitioned to the private sector, focusing on large-scale mixed developments, which eventually led me to Kenya,” he shares.
Before joining Tilisi as CEO, Graeme was involved in significant projects in South Africa and Kenya. In 2015, he was the director of Carlisle Property Holdings, the offshore development vehicle of Retail Africa, a well-known property development company in South Africa. During his tenure, he developed a significant pipeline of development opportunities in Kenya, including retail, office, logistics, and mixed-use developments. He joined Emerge Developments Limited in 2017, a specialist development management business, focused on maximising value for, and on providing the highest quality services to its clients where he worked on several major such as Nairobi Mega and roll out of travel convenience retail centres known as Safari Centres.
He also made noteworthy contributions during his tenure at Tatu City and the Two Rivers project. His involvement with Tilisi began as an ad hoc consultancy in 2015, where his expertise in urban management was put to good use. In February 2022, he made the pivotal decision to join Tilisi in a full-time capacity as the Chief Executive Officer.
Tilisi Developments specialises in selling land to developers, boasting a master plan and a meticulously controlled development approach. They offer land parcels with specific development regulations and collaborate closely with developers to ensure compliance. Graeme highlights that one of Nairobi’s most pressing challenges lies in the realm of development certainty for both developers and their target end users.
Tilisi, located about 30 km from Nairobi’s Central Business District, is a large 400-acre master-planned mixed-use, mixed-income development that provides exceptional benefits to investors. The development has fully serviced land parcels available to developers interested in logistical, residential, commercial, educational, medical, retail, hospitality, and recreational services.
In Graeme’s words, Nairobi faces the dilemma of unplanned, high-density developments that strain infrastructure, a stark contrast to Tilisi’s approach. He cites examples like Lavington, where rapid apartment development has led to infrastructure overload due to the absence of effective development controls. Similarly, the once-promising Buruburu area serves as a cautionary tale, as a lack of proper physical planning guidelines has resulted in unforeseen consequences.
“You can buy a low-density residential area and suddenly find a place like Lavington, just an apartment development, and the infrastructure can’t cope because there’s no control over what people do. You have a place like Buruburu, which started as an attractive environment where people are just allowed to do whatever they want to,” he explains.
Tilisi’s infrastructure planning, prioritising development rights, has been a game-changer. Graeme is quick to point out their success in avoiding scenarios like Westlands, a low-density residential business district where congested roads have become the norm. In essence, Tilisi’s commitment to controlled and structured development sets them apart, safeguarding against the pitfalls of unregulated growth.
With 73 per cent of the project now sold and in development, Tilisi, property owners, developers, and businesses expect to invest more than Ksh 60 billion. It is currently home to over 160 families and over 1,500 employees, creating a thriving town where residents and workers coexist together.
Walkable Cities
When Tilisi was designed, it was before the term 15-minute city had been coined. The term was consciously designed based on the fact that, as a mixed-use development, things need to be accessible. One can access all the amenities that Tilisi offers.
The design of the infrastructure has cycle lanes and good sidewalks that people use. I think it’s a big lesson for people working in cities. If you provide the infrastructure, people will use it, so you don’t have situations where you have an industrial area where thousands of workers walk to work, and if it rains, there are no sidewalks.
Tilisi’s sidewalks have proper landscaping. If you live in the community, you can take a stroll at any time of day or night, ride your bicycle, and get around. The concept is such that most of your day-to-day needs are accessible within a 15-minute walk, intending to try to reduce reliance on cars. Investors can make use of Tilisi’s plug-and-play solutions, suited for light industrial and logistics, and profit from its attractive green areas, convenient location, and numerous amenities. The development has a variety of housing options, retail centres, offices, schools, healthcare services, and recreational areas, all within a 15-minute walk or bike ride, making it an excellent choice for a future home or business.
Connectivity to other parts of the city is often important, given that you will still need to access other necessary amenities.
We’ve got three access points. From Chunga Mali to Waiyaki Way, Waiyaki Way to Limuru Road, and those are good public transport routes. So not only can people easily access their daily needs by walking or riding around, but they can also drive or use public transport to access the biggest city. If you look at great cities like New York or Manhattan, they are described as a series of villages, and if you look at the greater Nairobi area, it’s effectively connected,” he expounds.
Graeme argues that neighbourhoods could all be 15-minute cities if we invested more in the infrastructure that enabled people to utilise amenities within their immediate neighbourhood. One of the challenges to achieving this is the government’s investments in infrastructure. “There needs to be a greater intention for the local roads, the sidewalks, the landscaping, and the drainage. All of that is critically important if people are going to enjoy the benefits of their input, and I think the government is looking to have more localised interventions.”
In just 12 years, a once-thriving dairy farm has been transformed into a cityscape with a startling lack of trees. Graeme draws my attention to the pressing issue of climate change and its profound impact on urban areas. He emphasises that cities, often characterised by vast expanses of concrete and asphalt, are particularly vulnerable to the escalating temperatures caused by climate change. This transformation has given rise to what experts refer to as the “urban heat island effect,” where cities experience significantly higher temperatures compared to their surrounding areas.
Tilisi is a poignant example of a city that has taken proactive steps to combat this heat bubble phenomenon. In the quest for sustainability, the city has embarked on an ambitious tree-planting initiative and the creation of lush green spaces. This intervention has added aesthetic appeal and played a crucial role in regulating temperatures.
“We have planted over 1,200 trees in just six months. It’s clear that tree planting is emerging as a critical strategy to address the challenges posed by climate change and to ensure that our cities remain habitable, cooler, and more sustainable in the face of environmental crises.”
In addition, water is a scarce resource. Tilisi currently uses boreholes for water but plans to get additional supplies from Limuru Water and Sewerage Company (LIWASECO). Much of Tilisi’s water is groundwater. Tilisi has created a situation where they reduce the amount of groundwater they must take up while encouraging the developers to look at rainwater harvesting, which can be used for gardening and landscaping, to address sustainability and the availability of water, which is a big crisis.
“Globally, about 60% of people survive on the water from wells, boreholes, and groundwater, and that is affecting the axis. So, it’s a problem. But we do our best to try to address that sustainability issue.”
Replication of Concept
Can this concept be applied in other cities? Yes. Graeme points out that the model can be replicated. When the land was purchased about 12 years ago, it was indicated that the location was very far away. But there was a plan to upgrade Waiyaki-Way which has made it easier. The road network has made it easily accessible.
“Considerations of location are very important because of access, but we also got the benefit of a beautiful environment. I think Tilisi has also benefited from patient capital, unlike other masterplan developers who have not been successful.”
He cites projects such as Tatu City, which has been successful, and a very similar project to Tilisi: “Self-service land parcels to develop, power and water connections, water sewerage connections, and ICT connections are all included in the price. Tilisi to better serve its investors has a subsidiary Tilisi Power Company, which purchases and distributes bulk power from Kenya Power. What is exciting about Tilisi is the spread of choices. For example, Maisha has two-bedroom apartments being sold at Ksh5 million and then they go up to two and three bits, up to Ksh10 million. So, there is a nice spread in that particular market, which I guess is for more young professionals, although they have been sold to investors who rented them at an affordable rate,” he adds.
They also have the medium-density housing Mist, which starts at Ksh19 million, and Maisha Mema, which is semi-touch, starting at Ksh24 million. There are also Tilisi Villas, which are on eight and a quarter acres and stand-alone with a starting price of Ksh27.5 million. Graeme asserts, “What makes it exciting is the spread of variety, not just an exclusive place that is selling at Ksh 20 million; there is a range.”
Inclusivity
Graeme underlines the importance of inclusivity in cities, stating, “So you’re bringing in a range of people, and that’s good in terms of the kinds of other activities, the retail, all of that sort of thing.”
This approach extends beyond just the residential and commercial aspects. Graeme goes on to emphasise their conscious efforts in the realm of education. “We have one school starting in January, which offers an International Curriculum, and we are in discussions with another school chain that offers the CBC curriculum, so that’s still in here. We’ll have two schools, but what it does mean is that if you have a range of housing typologies, you also need to have facilities that cater for the people’s different economic positions and incomes then.”
Graeme’s vision for Tilisi extends even further, emphasising the genuine integration of the project within the surrounding community. He asserts, “We create a lot of jobs in the community; we’ve stimulated economic development in the community because people who come to work here may rent.” This approach not only fosters economic development but also breaks down traditional barriers. Graeme envisions Tilisi as a place where you seamlessly become a part of the community. “If you want to come and shop here, you’re not going to go through the main gate. You just come and shop, as if you belong.”
Zoning
Before the management of Tilisi started planning, they did a very detailed market research study in 2012 that came up with the kind of mix that one should have in terms of the number of acres, and how many buildings there should be in different categories. The research company found that one should start with logistics, and Tilisi happened to sell out logistics and had to increase the number of acres from 72 to 112 because of the increase in demand.
“What happens is that you give this to an architect or urban designer looking at the typology. You can’t use the logistics in very steep areas. Topography informs your decisions about where to locate it. How do you make sure that your central district is in proximity to workers in the logistics areas, residential areas, etc.? It’s all about creating the right balance between high-density, medium-density, and low-density residential areas. It takes a good understanding of the market dynamics, your topography, and how many different uses you can put into that, which then informs your engineering services. If you’re saying I’m going to have 2000 people living in apartments, what does that mean for water, roads, and, critically, roads?” he poses.
In April 2020, during the COVID outbreak and the onset of restrictions, Tilisi Views was launched and made the highest sales in stand-alone villas. He attributes this to many people wanting to move away from apartments and have a bit of garden space at a time when there was a lockdown and work-from-home policies.
Occupancy
Graeme reveals that the sales for Tilisi have been good, with 50 per cent investors and 50 per cent homeowners, which he describes as a good spread. The villas have 80 per cent homeowners. “You want to keep that balance between absentee investors. You don’t want them controlling a whole block.”
Graeme says it’s hard to understand Kenya’s current real estate market, citing Tilisi selling an average of Ksh30 million worth of villas every month. He, however, says that, at the same time, things are very tough for people in the low-end market.
“We’re very pleased to sell to International Housing Solutions, a South African green affordable housing developer because we need more affordable rentals. 78 per cent of urban Kenyans live in rented accommodations. It is very difficult to get a mortgage, particularly if you are not in regular employment with a monthly salary. You need Ksh150,000 a month, and a very small proportion of Kenyans earn this.”
With a Sh1.2 billion investment in 240 units in Limuru, investment group International Housing Solutions IHS hopes to increase the amount of affordable housing it offers. The developer broke ground in June on the 240-unit project in Limuru’s Tilisi neighbourhood as part of its plan to create affordable housing with green building techniques. The company stated that the development will consist of a variety of two- and three-bedroom flats through the Tilisi Masterplan development’s Muzi Salama project.
From his point of view, there is a desperate need for more affordable rental accommodations, and not just in Kenya. The real estate market cost of debt keeps increasing and is going to seriously affect a lot of developers because it is expensive to borrow. He adds that one can put their money in short-term government security and get 13 per cent interest, given capital appreciation.
His advice to any individual or investor interested in property development is to thoroughly research the location and be certain of what you intend to undertake. He makes a case for places like Tilisi, which offer prospective homeowners an attractive option to consider. He advises investors to study an area before developing by doing a market study.
For Graeme, success means making sure that people who live and work at Tilisi like living and working at Tilisi, which he says has been successful so far. Ensuring that developers experience what development should be. He says it’s an important measure of success, ensuring that from the time you start building to when you start operating, it’s a good experience. His ability to be responsive to people’s needs is a very important measure of success for him.
