Divisional Director Research
Cushman & Wakefield Broll
The Namibian economy was already under severe pressure, having been in a recession for two years prior to the COVID-19 pandemic, with mining and agriculture performing below expectations, primarily as a result of the continued drop in commodity prices and the severe draught experienced in the country. With the closing of borders and nationwide lockdown, tourism, the main contributor to Namibia’s GDP growth, has been devastatingly affected. The tertiary industry has also been severely impacted by the lockdown as ‘stay home restrictions’ limit any movements throughout the nation. However, on a positive note, interest rates have decrease by approximately 2%, providing necessary relief to consumers and business that may need to borrow money to sustain themselves.
Restrictions on trade due to the lockdown have severely affected the retail industry with only essential service providers being permitted to trade. With the uncertainty in the economy and the possible loss of income, consumers are being more cautious, lessening their spending resulting in reduced turnover for those essential retailers still trading.
The COVID-19 lockdown appears to have had a minimal impact on the industrial sector with no requests for rental reductions or deferments, despite closure.
The Office market appears stable in Namibia amidst the Coronavirus lockdown. However, the risk of business closures and the change in work patterns, (i.e. more people who could be starting to work from home), could aggravate vacancy rates in the future. A significant amount of request for rental reduction, even prior to the crises, have also been received. .