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Cape Verde's 'win-win' situation

A new type of property investment strategy seems to be taking off in Cape Verde.

Commercial property was once considered an investment class for institutional investors only. This is because of the high capital outlay usually required to gain access to what is traditionally a relatively stable, lower risk, strong returning asset class offering benefits such as upward only rental reviews for example.

Now, thanks to the fact that new residential property markets have emerged around the world, new commercial property markets are also emerging and offering the likes of you and me a chance to cash in on attractive commercial rental yields and capital appreciation by buying in at attractive and achievable prices.

As Gene Sperling, former economic adviser to Bill Clinton and now Bloomberg columnist recently pointed out: "commercial real estate tends to lag behind housing trends. The residents of new developments need stores to shop in and offices to work in, so commercial projects are planned after a town starts booming and are completed in the following quarters. So when times are good for housing, commercial property makes the real-estate investment news even better."

Demand increasing

And nowhere are times better for housing than in Cape Verde, which is now also a perfect example of an emerging market offering commercial property investment opportunity; what's more, Cape Verde is also a location in which a number of Britons have already made a success of the commercial property scene.

Adrian Lillywhite of Cape Verde Property Ltd explained: "The demand for commercial premises and also profitable and established business concerns in Cape Verde is increasing in line with demand from tourists and expatriates for services and facilities, and it is growing in line with local and expatriate demand for premises from which to run businesses which are in demand!

"Therefore it is something of a win-win situation in Cape Verde's commercial sector currently in terms of demand, and this is impacting on the price of commercial property and businesses for sale very positively.

Tip of the iceberg

He added: "The sudden interest in commercial property in Cape Verde represents just the tip of the iceberg when it comes to the overall, long-term requirement for premises and businesses for sale."

"Cape Verde is a location developing rapidly. It is witnessing population growth, it is witnessing a flourishing tourism market that is continuing to expand, and it is a location where new services are required and where people can see increasing business opportunity.

"This is why we have seen the rental rates that commercial property owners enjoy rise from an average of EUR 500 per month last year to reach between EUR 800 and 1,500 this year..."