Africa’s economies have shown resilience in the face of global challenges, with projected growth rates expected to outpace the global average, reaching 3.7% in 2024 and 4.3% in 2025. However, sustained long-term growth is still challenged by infrastructure gaps, climate change impacts and sociopolitical issues. Countries with diversified economies and strong governance are better positioned for growth.

This is according to the 35th edition of the highly respected ‘Africa Cost Guide: Property & Construction 2024/25’ from globally trusted infrastructure consulting firm AECOM. “South Africa remains a top investment destination despite lower growth rates. The public and private sectors can enhance this perception by improving transparency, governance and investing in critical infrastructure projects,” comments Michell Bezuidenhout, newly appointed PCC Director.

Aimed at the broader built environment, the Africa Cost Guide is endorsed and disseminated by key associations such as the Association of South African Quantity Surveyors (ASAQS), with Dr. Gerhard Brümmer (PrQS, PMAQS) as the principal author. “The guide is a testament to AECOM’s dedication to excellence, encapsulating the essence of our relentless pursuit of progress,” comments Niel du Pisani, Associate Director,  Cost Management, Africa.

“We have clients asking when the new guide will be available, as they keep it handy for reference. It has become an important resource, regularly used and referenced by key industry players from architects to property developers,” adds du Pisani.

The Africa Cost Guide stresses the need for a holistic approach to infrastructure in South Africa, considering economic benefits and social values like health, quality of life and social inclusion. It aligns with AECOM’s ‘Think and Act Globally’ strategy, leveraging global expertise and digital innovation to deliver locally tailored solutions informed by global best practices. This integrated approach addresses local challenges such as unemployment, public health, and infrastructure deficits while benefiting from international collaboration.

This year’s guide highlights several interesting trends, including the growing demand for Purpose-Built Student Accommodation (PBSA), as highlighted by the Cape Station project in Cape Town, the continued importance of digital transformation in construction through technologies like 5D BIM, which enhance cost management and improve project outcomes, the growing focus on ESG criteria, and the rise of public-private partnerships to fund large-scale projects.

Africa is becoming a global investment hotspot, particularly as countries diversify their economies and focus on decarbonisation, energy transition and infrastructure development. Africa holds a significant share of the world’s natural resources such as cobalt, diamonds and platinum, which are critical for industries undergoing green transitions.

There is also a growing recognition of Africa’s vast renewable energy potential, which is drawing interest from investors focused on sustainable infrastructure. This shift is attracting significant foreign investment from emerging markets like China, India and the UAE, which are financing a substantial portion of infrastructure projects.

As sustainability increasingly becomes a key focus in construction and development, du Pisani emphasises the vital role of value engineering in addressing environmental impacts across projects. Expressing optimism about the evolving investment landscape, du Pisani states: “It is encouraging to see sustainability becoming the norm.”

AECOM is now incorporating green practices into every design. “There is definitely a shift in client demands toward more sustainable solutions,” adds du Pisani. Africa is also an emerging hotspot for renewable energy investment. “Foreign investment is growing, and we need to tap into those opportunities.”

Building inflation is currently between 5% and 6% annually, a significant factor that clients typically manage well. However, concerns about financing for larger projects persist. “Our main clients do not face issues accessing funds, but smaller companies might struggle,” says du Pisani.

The constant demand for cost-effective solutions remains a priority. “We always focus on achieving a balance in project costs,” says du Pisani, acknowledging the delicate balancing act required to optimise both construction and operational efficiency.

“The Africa Cost Guide not only enhances AECOM’s value proposition but also benefits clients seeking to navigate the complexities of modern development. As the industry continues to evolve, the integration of sustainability and value engineering will be critical in shaping a more resilient future,” says du Pisani.

“Our message to clients emphasises resilience and innovation. Despite local and international challenges, we are committed to delivering value-driven, sustainable solutions to meet the evolving needs of our clients. We leverage our global expertise, digital tools and adaptability to navigate our clients’ complex projects in uncertain times,” concludes Bezuidenhout.

-Ends-

About AECOM

AECOM is the world’s trusted infrastructure consulting firm, delivering professional services throughout the project lifecycle – from advisory, planning, design and engineering to program and construction management. On projects spanning transportation, buildings, water, new energy, and the environment, our public- and private-sector clients trust us to solve their most complex challenges. Our teams are driven by a common purpose to deliver a better world through our unrivalled technical and digital expertise, a culture of equity, diversity and inclusion, and a commitment to environmental, social and governance priorities. AECOM is a Fortune 500 firm and its Professional Services business had revenue of $14.4 billion in fiscal year 2023. See how we are delivering sustainable legacies for generations to come at aecom.com and @AECOM.

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Lucy McLane
Communications Manager, Strategy & Growth, Middle East & Africa
Email: lucy.mclane@aecom.com
Website: www.aecom.com  

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