AFRICA
Africa’s construction market forecast to outperform other regions
The African construction market remains diverse, with varying growth trajectories across countries and sectors. Despite ongoing global and regional challenges, Africa is expected to outperform many global regions over the medium term, supported by population growth, urbanisation and infrastructure investment.
Within South Africa, market conditions remain mixed, with selective recovery emerging across provinces. Gauteng is showing cautious improvement, activity in Western Cape is being driven by residential, hospitality and tourism-led development, and KwaZulu-Natal is benefiting from renewed public sector activity.
Infrastructure projects lead recovery
Gauteng’s construction market is showing a slow but steady recovery, driven by government infrastructure spending, strategic developments, and renewed retail and urban precinct activity, particularly around Pretoria. Industrial and logistics projects remain the most active, while retail is strengthening. Residential activity shows early signs of recovery, although private commercial development remains constrained by cost and funding pressures.
The Western Cape continues to outperform, supported by inward migration and strong residential demand, coupled with retail sector growth. Infrastructure is also set to expand over the next few years. Tourism continues to support hospitality-led development, including upgrades to wine estates and luxury hotels, alongside growing residential and commercial interest linked to the Cape Winelands Airport redevelopment, while office activity remains subdued.
KwaZulu-Natal’s growth is largely infrastructure-led, with ports, roads and logistics projects dominating, alongside selective recovery in hospitality, healthcare and retail along coastal nodes. Other provinces are experiencing primarily public sector growth, with limited private sector activity outside industrial and renewable energy projects.
Namibia presents growing opportunities across mining-related infrastructure, transport and private sector social developments, supported by relative political stability and sustained investor interest. The DRC continues to offer high-value opportunities driven by large-scale mining activity and associated logistics and transport infrastructure, reflecting ongoing capital investment in resource development. Kenya remains a strong growth market, underpinned by tourism recovery and continued government investment in housing and public infrastructure, supporting both private and public sector construction activity.
Inflationary pressures drive up tender prices
Tender prices across Africa have been on an upward trend over the past 12 months due to elevated material costs, labour constraints and logistics challenges. In South Africa, tender price inflation has remained moderate but persistent, with regional dynamics influencing outcomes. The Western Cape has experienced firmer pricing supported by strong residential and hospitality demand, while Gauteng has seen competitive pricing conditions driven by subdued demand and margin pressure.
Looking ahead, improving demand and a shift towards larger projects are expected to place upward pressure on tender prices, although stable interest rates and favourable exchange rates should support manageable growth.
Market outlook reflects cautious optimism
Across Africa, the outlook remains cautiously optimistic. Investor confidence is expected to be selective, supported by infrastructure investment and service delivery in stronger-performing markets.
In South Africa, stable interest rates are supporting investor confidence, enabling private sector participation and allowing developers to progress projects. Rising labour, fuel and utility costs are expected to push up input expenses, though this risk is partially mitigated by movements in the rand against major currencies.
Productivity improvements – through international building methods, skills development and AI-based software – are helping to shorten project timelines and enhance efficiency. Overall, political uncertainty and global geopolitical risks remain key downside factors. Countries with robust governance and private sector confidence are best positioned to convert project pipelines into realised projects over the next 12 months.
“Investor confidence is expected to be selective, supported by infrastructure investment and service delivery in stronger-performing markets.”
RLB © 2026 Rider Levett Bucknall.