Seychelles and Mauritius Commercial Real Estate Options
November 15th, 2013 by Diane Moore
Have you ever been thinking of going exotic? Well, commercial real estate has no boundaries, and you can both invest your money into the profitable exotic business and enjoy the sunny sizzling days on the beach at the same time. How would you do that? There are two solutions – Seychelles and Mauritius Islands.
As you have already understood, this time we are going to discuss the Seychelles and Mauritius property markets and what they have to offer for the successful investors who are seeking for the new possibilities to grow in their business.
Mauritius Commercial Real Estate
There are too many good things to be said about this beautiful Island that attracts the foreign investors from all over the world with its tropical climate, genuine hospitality and comfortable business environment.
The investors will be surprised with a positive attitude that Mauritius people have to the non-citizens and how the government supports the investment initiative, especially in the hospitality and property development industry.
This place is especially attractive thanks to the absence of any capital gains tax, estate and inheritance tax. It is a country with a law tax jurisdiction, business-friendly regulations, high-end telecommunications and simply a very pleasant place to live in from various points of views.
Foreign investors like doing business in Mauritius since the Government policy allows the foreign investors to purchase the immovable property for commercial business development.
So, Why Investing in Mauritius Commercial Real Estate Sector?
If you have paid your special attention at Mauritius property market than you have made the right choice because this exotic Island offers:
- Stable political and macroeconomic environment
- Top notch geographical location and developed infrastructure
- Competitive business environment
- Growth rate of 15% in the construction sector
- Growth of 5% in number of tourist arrivals
- High level of life quality
- Transparent and simple business regulations
- High quality international standards for business and lifestyle
- Low income and corporate taxes of 15%
- No trade barriers or quotas
What Are the Best Places to Invest in Mauritius?
It is the capital and the largest city of Mauritius with a population of nearly 148,416. Port Louis could definitely be named the economic, cultural and political center with a highest quality living in whole Africa.
It is the capital of the Lower Plaines Wilhems and is the third largest town in Mauritius with the largest number of the inhabitants of all ethnic groups. It has various shopping facilities and developed infrastructure, making this town the desirable destination.
Currently, Mauritius offers the wide range of commercial property opportunities:
- Office Buildings
- Shopping centers
- Distribution facilities
Investors should take a note about the further development of the shopping industry in Mauritius, not to mention about already existing famous shopping mall Bangatelle, which is the leading retail destination that offers different leisure options and attracts the shopaholics from all over the world.
Probably the most promising commercial property investment is taken by the high-end shopping and boutique malls, boulevards that are connecting the hospitality and leisure activities. This property sector is currently flourishing due to the steady growth of the tourism industry that does not plan to stop here.
It would have been appropriate to mention the office development in the Mauritius real estate market that at the moment includes a big number of international and financial corporations. High-end offices and industrial spaces can be set up and leased in the strategic areas of this perspective Island.
To add more, Mauritius will have the significant changes in the next 10 years. This includes the wide-ranging infrastructure projects that will have the positive influence over the real estate sphere and provide its flourish development. Mauritius has opened the acquisition of freehold property to the foreigners that has consequently resulted in the burst of brand new transactions in the real estate market and foreign capital flow.
Seychelles Commercial Real Estate
We could not but mention the thriving nature of Seychelles archipelago. For those who did not know it, the Seychelles consists of 115 islands with outstanding beaches, breathtaking landscapes, unforgettable marine life and much more. It takes 1,600 km off the Eastern Africa coast and inhabits only 81,000 people. Probably the best thing about the Seychelles is weather that is almost always stable all year with an average temperature of 28-29 degrees. Also, it is worth to mention that Seychelles has the highest human development index in Africa with GDP of $10,714 per capita.
As to the culture specifics, Seychelles has been largely French-influenced, thus making its population mixed and diverse. The tourism takes nearly 30% of the labor force, empowering its economy.
Generally, the most frequent investors in Seychelles come from such countries as Italy, Russia, UK and US. We must say that the property of Seychelles is rather expensive and prices in the capital, Mahe, kick from $160,000 and higher. As to the land prices, they vary from $50 per sq.m., for a land with no view to $1,500 per sq.m., for the beachfront properties. It does not end here, because if we are talking about the largest island, Praslin, the property prices are getting even higher (20-25%) because of the attractive beach location.
Is it that Difficult to Purchase the Real Estate in Seychelles?
According to the general low, the foreigners are allowed to purchase the residential property that can only be used by the buyer and his family. The Immovable Property Act prohibits the lease of immovable property owned by a non-Seychellois. Before you decide to purchase, you will need the Government Sanction and it is advisable to hire the services of a notary who will provide you with all the necessary information.
It is important to mention that Government grants leases in case the aim of your purchase is commercial or industrial. When the non-Seychellois buyer decides on this investment type, he is required to deposit $84,474 in the central Bank of Seychelles in foreign currency. Also, in case the purchased property is a developed land, than its price should not be less than $84,747, and if it is the vacant lot, than the price goes up to $168,949.
Nevertheless, when talking about the built-in property prices they would definitely surprise you, making them $1,000-$1,200 per sq.m. The same thing happens to the rent prices that are also rather low and a 150 sq.m. property with a price of $190,000 may have the rent price of $800 per month. According to the general rule of thumb, the larger the property is the lower yields it produces.
Is there any Residential Development Going on Seychelles?
- Four Seasons Private Residences. It is a top notch exclusive residential development located at the Mahe’s southwest coast. It consists of four to six bedroom villas with the price of about $7 million.
- Eden Islands. It is a marina development on a reclaimed land that is connected with the Mahe Island by the bridge. This exclusive residential complex contains about 450 luxury apartments, mansions and villas with the general price of $300,000.
It is worth mentioning that there are no property taxes or capital gains in Seychelles. However, the foreign homebuyer is expected to pay a processing fee of 1,5%, a sanction duty of 11% and a stamp duty of 5%.
What about the Economic Growth?
Seychelles economic growth has been rather low over the past decade, and its GDP has declined by around %5.
Probably the main Seychelles problems are caused by the:
- Overload currency
- High regulatory and tax costs
- Difficulty of repatriating profits
- State control of the economy
Despite the economy ups and downs that have caused the overvaluations of the Seychelles rupee, the economy has still expanded buy the year 2012 in 4%.
The same thing happened to the unemployment rate that in 2011 was reaching the point 4,1% point, and by the years 2012 has showed the signs if revival and fall to 3,7% according to the IMF. Talking about the positive sides, the Seychelles government made this place a tax paradise through the well-drafted legislation. Furthermore, the government has succeeded in setting the fruitful International Trade Zone, thus making the Seychelles an Indian Ocean trading center.
These two Islands may seem like a dream destination for the commercial real estate investment, but you need to take the measurable steps towards this changeable business. Both Seychelles and Mauritius have their pros and cons, and only a professional real estate agent will be able to put you on the right path. Hence, apply this information mindfully and expand your business towards the exotic direction.
Latest posts by Diane Moore (see all)
- Tips for Making your Commercial Property more Energy-Efficient - January 22, 2014
- Remodeling Investments that Will Pay You Back - January 21, 2014
- 21 Reasons to Invest in the US Commercial Property Market - January 20, 2014