MASTER DELIVERY PARTNER 1

Phase 1 Implementation Plan

Presentation to KOTDA Board
February 21, 2013
 MDP1 is a multi-disciplinary team engaged in August 2012

Project Lead
Real Estate Strategy
Business and Governance Planning

LPDP and Local

Master Planning Sustainability and ITES Outreach Infrastructure Planning
Architecture Design Guidelines ITES Strategy Planning Expertise

2
 MDP1 will complete its assignment at the end of February.

Complete In progress

Business and
Governance
Plan

Sector
Strategy Master
Vision + Financial GoK and KOTDA
Plan + Action Plan
Mission Strategy Implementation
Real Estate Design
Strategy

LPDP
MDP2

3
 Konza Technology City vision statement

Konza Technology City will be a

sustainable, world-class
technology hub and a major
economic driver for the nation,
Konza
with a vibrant mix of businesses,
workers, residents, and urban
amenities.

4
Konza is 60km from Nairobi, providing opportunity and challenge.

5
At 5,000 acres, Konza is comparable to other world-class cities.

6
Konza will be positioned as a mid-density urban environment.

SHoP triangle density diagram workshop 1

7
 A citybuilding strategy will help Konza accommodate
anticipated growth in Kenya.

Market trend Implication for Konza

Development indicators confirm growth Opportunity to accommodate growth if

potential for Kenya competitively positioned

Offer a value proposition as a standalone

Suburban areas offer plentiful land supply
city rather than competing with
have drawn development activity
suburban areas

Areas with good connectivity have attracted A109 and rail improves development
growth prospects

 High population growth, high urbanization rates , and GDP growth highlight that the fundamentals are in
place for strong growth in real estate demand in upcoming years.
 Given the wide availability of well-connected land within Nairobi metropolitan area, for growth to occur Konza
should be different. It should position itself as a self-sustaining city, providing all the elements required to
attract people and workers.

8
11 case studies narrowed from a list of 26 showcase the
ingredients for successful technology hub development.

Selected case studies reflect a variety of sizes,

business models, locations, economic environment
and time of inception

9
 Case studies vary in size, age, and economic context.

Size Year of Distance from Current

Case (acres) Establishment CBD (km) Employment
RTP 7,000 1959 9 49,000
Developed

Cambridge 150 1970 5 5,000

Shannon 600 1960 2 6,500

Singapore 75 1982 6 9,000

MMC 183,000 1996 0-50 119,000

Emerging

Dubai 700 2000 25 20,000

HITEC City 150 1998 13 N/A
Zhongguancun 128,000 1988 13 950,000

Curitiba 50 2008 2-9 16,000

Emerging

Smart Village 475 2003 25 20,000

African

Innovation Hub 60 2001 6 N/A

10
 Case studies reveal base criteria for technology hub
development.

 Anchors that build a brand and attract a mix of firms.

 University that interfaces with large and small companies, creates a
brand for the hub, and generates on-site economic activity.
 High quality and reliable infrastructure including telecom and utilities
as well as transport links.
 Attractive financial incentives including tax incentives and other
policies to reduce the cost of business.
 Low regulatory burden with ease of doing business and one-stop-shop
point of service.
 Mixed-use character creating a desirable, active, and walkable district.
 Special-purpose governance entity to carry out project mission and
ensure long-term success.

11
 Outreach to over 300 companies identified sector opportunities
and requirements for tenants to locate in Konza.

Synthesis and
Sector Scope Assessment Recommendations

ITO / BPO
Global Strategic Fit
Telecom Interview Insights

Education
Local
Financial Services Anchor / Follower

Life Sciences
SME Sector Summaries
SMEs Job Impact
(incl. students)
Public Sector Cross-Sector

Data Collection Long Interviews Public Forums

12
 In parallel, economic analysis identified sectors that should be
fostered at Konza to achieve its goals.

Prioritizing sectors for Konza

 Large and fast growing in Kenya
 Level of expenditure on ICT as % of contribution to GDP
 Demonstrated gap in ICT spend between Kenya and developed ICT
markets

Sector trends to consider

 Sector drivers
 Current competitiveness
 Regulatory trends
 Labour availability

13
 Four knowledge-focused themes emerge, two of which are
significantly government funded.

Sector Highlights Key

funder

Education  Could be anchored by JKUAT, UoN, MMU Gov

 Post-graduate education, focus on innovation and employable skills
 Sector will benefit from internships and partnership-projects with
commercial institutes operating in KTC

Life  Could be anchored by Nairobi Hospital, KARI, KEMRI Gov /

Science  Primary, secondary and tertiary care facilities; can attract hospitality Comm.
industry
 Life sciences R&D (Human / Agri.), driven by national research agenda
 High-level of collaboration with KTC universities, and in time with drug
companies and medical device production firms / spin-offs

ITO / BPO  Could be anchored by Dhanush, Craft Silicon Comm.

 Leveraging infrastructure, young / educated workforce for global market
 Strong university partnerships for recruitment
 Financial incentives and regulatory reform will be critical

Telecom  Could be anchored by Safaricom, Wananchi, RIM Comm.

 Leveraging KTC for regional market access
 Strong university partnerships for recruitment
 Financial incentives and regulatory reform will be critical

14
 Phase 1 should target 7,500 knowledge (office/life science)
workers.

7,500

MDP1 identified 2,550 jobs with near-term

potential to locate in Konza, 1,750 of which 5,750
are professional office/life science jobs.

350
600 1,750
600
Physicians 200
Staff 800 800
Hospital Life Science ITO / Telecom Anchors Followers Total
Lab BPO

Nairobi KARI Dhansush RIM

Hospital KEMRI Craft Silicon Safaricom
Wanainchi
Group

MPD1 outreach to over 300 organizations indicates near-term interest from these companies in coming to Phase 1 of Konza.

15
 Konza’s value proposition is to become a self-sustaining city
anchored by a cluster of knowledge industries.

Vision Implementation

City elements Catalyst program

Office: ITO/BPO/Telecom
Retail Residential
Life sciences: Lab/Hospital
Services Vibrant public realm
University

Activating elements Ancillary program

Creative Industries Cluster Public services Hotel

Retail Residential

16
Phase 1 establishes a framework for the future growth of Konza.

17
Konza Phase 1 vision

Total development: 1.5M m2

Total workers: ~17,000
Total residents: 30,000

18
 An enabling environment must be in place to attract 17,000
jobs in Phase 1.

Urban Economic
KOTDA policy
environment environment
High quality
Effective marketing Anchor tenants
infrastructure

Incentives High quality services Access to talent

Regulatory
Regional accessibility
environment

19
Phase 1 of Konza, with catalysts in place, could entail 1.5 m2
of total vertical development.

Catalyst program Ancillary program

Civic and Flex: 14,000 m2
Office: Upper income housing: 240,000m2
81,000m2 Studio–1 bedroom: 420 units
2–4 bedrooms: 1,050 units

Lab:
35,000m2
Middle income housing: 660,000m2
Hospital: Studio–1 bedroom: 1,720 units
50,000m2 2–4 bedrooms: 4,400 units

University:
194,000m2
Studio–1 bed: 510 units
Lower income housing: 100,000m2 2–4 bedrooms 1,300 units
Retail: 65,000m2
Hotel: 6,000 m2
School: 44,000m2

20
 Program will be distributed throughout the “Stitch” on
specialized “bands” connected by a mixed-use “bar.”

BAND BAND
Life Science Office

BAND
Residential
BAND
University

BAR
Mixed Use

21
Phase 1 will be built out over 400 acres of land.

Phase 1 Land Area

Mixed Use 89 acres
University 39 acres
Residential 26 acres
Life Science 26 acres
Office 11 acres
Retail 8 acres
Cultural/Community 1 acre
Vertical Development Subtotal 201 acres
Parks 79 acres
Transportation and Other Public Space 130 acres
Total 410 acres

22
 Over 5 years, development agreements will ensure great
neighborhoods and employment clusters will be established.

Phase 1 vertical development footprints

Vertical development
transactions by year
2013
2014
2015
2016
2017

23
What do we need to make Konza a reality?

Governance

KOTDA Statute with

Incentives

Infrastructure

24
Establishing KOTDA, a special governance authority, helps to
ensure successful project implementation.

KOTDA
Unique benefits
• Single-purpose mission
• Efficiency
• Flexible use of funds
• One-stop shop
• Single voice/messaging
• Highest quality human resources

25
 KOTDA will be single-purpose entity empowered to carry out
its mission.

KOTDA mission
To ensure that Konza Technology City grows into a sustainable, world-class
technology hub and a major economic driver for the nation, with a vibrant mix of
businesses, workers, residents, and urban amenities

Characteristics
High-quality
Single-purpose
Results-oriented

Responsibilities and powers

Market
and Control Regulate Finance Develop Manage
promote

26
 KOTDA Board structure

Advisory Committee
Konza Konza
developer business
rep. tenant rep.
Cabinet Konza
Secretaries residential TBD
tenant rep.

KOTDA Board
Government of Kenya Private Sector
Other CHAIR
Ministry of Ministry County John Haron Reuben Emma Rosemary
MoIC
Finance (e.g., Trade, representative Ngumi Nyakundi Mutiso Miloyo Maundu
Education)

KOTDA CEO
KOTDA sits within MoIC

27
 Organizational structure: full capacity

Legend
Officer
Board of Directors
Internal Audit
Department
MDP
External Resource
External Govt
CEO General Counsel
Chief Executive Officer

CDO CFO CBDO Services

Chief Business
Chief Development Officer Chief Financial Officer
Development Officer Manager
Accounting, and Business
Real Estate Construction
Administration Development

Public Revenue, Marketing,

Infrastructure
Grants, Budgeting, Branding, Municipal Services
Development
and Financing Communications
Community and
Planning and Service Fee
Government Business Services
Permitting Collection
Relations
provides
oversight provides
funding
MDPX
External Resources
GOK

28
 Year 0: minimal staffing, outsourcing for critical expertise

Legend
Officer
Board of Directors
Internal Audit
New Department
MDP
External Resource
External Govt
CEO General Counsel
Expert Private
Service Provider
Chief Executive Officer (Legal services)

CDO CFO CBDO

Chief Business
Chief Development Officer Chief Financial Officer
Development Officer

Accounting, and Business

Real Estate
Administration Development

Public Revenue, Marketing,

Infrastructure
Grants, Budgeting, Branding,
Development
and Financing Communications
Expert Private
Service Provider
(Level 1 processes)

Expert Private provides

Expert Private
Service Provider oversight provides Service Provider
(Deal structuring, funding (Communications
Governance, MDP2 MDP2 and marketing)
coordination)

GOK

29
 Years 1-5: internal capacity building

Legend
Officer
Board of Directors
Internal Audit
New Department
Established Department
MDP
External Resource
CEO General Counsel
Expert Private
Service Provider
Chief Executive Officer (Legal services)
External Govt

CDO CFO CBDO Services

Chief Business
Chief Development Officer Chief Financial Officer
Development Officer Manager
Accounting, and Business
Real Estate Construction
Administration Development

Public Revenue, Marketing,

Infrastructure
Grants, Budgeting, Branding, Municipal Services
Development
and Financing Communications
Expert Private Community and
Planning Service Provider Government Business Services
(Level 1 processes) Relations
Expert Private provides
Expert Private
Service Provider oversight provides Service Provider
(Deal structuring, funding (Communications
Governance, MDP2 MDP2 and marketing)
coordination)

GOK

30
 Years 6+: full capacity

Legend
Officer
Board of Directors
Internal Audit
New Department
Established Department
MDP
External Resource
CEO General Counsel
Chief Executive Officer
External Govt

CDO CFO CBDO Services

Chief Business
Chief Development Officer Chief Financial Officer
Development Officer Manager
Accounting, and Business
Real Estate Construction
Administration Development

Public Revenue, Marketing,

Infrastructure
Grants, Budgeting, Branding, Municipal Services
Development
and Financing Communications
Community and
Planning and Service Fee
Government Business Services
Permitting Collection
Relations
provides
oversight provides
funding
MDPX
External Resources
GOK

31
 Year 10+: transition to management role

Legend
Officer
Board of Directors
Internal Audit
Department

CEO
External Resource
External Govt General Counsel
Chief Executive Officer

CFO CBDO
Chief Financial Officer
Chief Business Development
Officer
Services Manager
Accounting, and
Business Development
Administration

Public Revenue, Grants,

Municipal Services
Marketing, Branding,
Budgeting, and
Communications
Financing

Social Services
Community and
Service Fee Collection
Government Relations

Business Services

Director of Development

Real Estate

Infrastructure
Development
External Resources
Planning and
GOK Permitting

32
 KOTDA will evolve over time.

Konza Technology City

Development timeline
Phase 1 Future phases Full completion
(years 0-5) (years 6-10) (years 10+)

KOTDA
Organizational timeline
Minimal staffing and Internal
outsourcing for capacity
critical expertise building

Full capacity

Transition to
management role
Option: Phase out to
local government

33
 Konza must offer both financial and regulatory incentives.

Potential financial policies

 Corporate income tax exemption
 Stamp duty exemption
 Employment-based grants
 Tax policy to encourage headquarters establishment
 VAT and duty-free import of materials for business purposes
 Revisions to existing depreciation policies

Potential regulatory policies

 Expedited company incorporation
 One-stop shop
 Single window clearance
 Easing of restrictions on foreign ownership and employment

34
 Infrastructure will be financed by different entities, requiring
key partnerships.

Project Finance

On-site
KOTDA
Infrastructure $750M
Government of Kenya
$1,060M

Off-site
$310M

Focus of this section

Financing Entities

35
 Financing the on-site infrastructure requires PPP and non-
PPP project types.

On-site KOTDA
infrastructure Type of projects Funding source Financing Entity

User fees
Project Finance
PPP
$350M Government
revenues
Government
$750M
KOTDA
 Land leases
Non-PPP  Service fees
Government
 Federal taxes
$400M Government
revenues

36
 Each PPP project will need a business plan, rate study
and assessment of available funding.

PPPs and
Utilities

Water and Sewer

User Fees Analysis

Solid Waste
Government Funds Available

Communications:
Fiber
Rate Study

Power
Business Plan

Local Transit: Buses

Regional Transit Primary Infrastructure

Public Transit

37
Non-PPP projects will be managed by MDP2 with funding from
GoK.

Government
Funding
Budget Requests

Facilities
KOTDA Management
O&M Contract Operator (O&M)

MDP2 Contract

MDP2

EPC Contract

Construction
Contractor (EPC)

38
 Non-PPP funds will be sourced from land leases of
income-generating catalyst and ancillary programs.

Catalyst program Ancillary program

Flex: 7,000 m2
Upper income housing: 240,000 m2 Civic Flex: 7,000 m2
Office:
81,000 m2 Studio–1 bedroom: 420 units
Income-generating development
2–4 bedrooms: 1,050 units
Non income-generating
development
Life Science: 21,000 m2
Life Science: 14,000 m2
Middle income housing: 660,000 m2
Hospital: Studio–1 bedroom: 1,720 units
50,000 m2 2–4 bedrooms: 4,400 units

University:
194,000 m2
Studio–1 bed: 510 units
Lower income housing: 100,000 m2 2–4 bedrooms 1,300 units
Retail: 65,000 m2
Hotel: 6,000 m2
School: 47,000 m2

39
 KOTDA will sign land leases with vertical developers.

Finance
99 Year Land Lease
KOTDA
Debt
Banks

Debt Institutional
Land Lease Payment &
Investors
Service Fees
Vertical Developer
Taxes Equity
GoK Developer’s equity
Counties
Equity 3rd party equity
Taxes Tenant Attraction
Tenants Investor

Construction EPC Contract

Contractor Target Uses

Commercial Life Science

Management
Contract
Property
Management Retail Residential

40
 Land lease agreements should follow a process that creates
market interest and ensures alignment with Konza’s mission.

1 2 3 4 5 6
Determine Marketing and Determine Procurement Evaluate Negotiate deal
parameters business evaluation process responses terms
development criteria (RFEI/RFP or
sole source)
Developer,
Location: Term sheet
Konza promotion Economic offer investor, and Credit testing
parcels/zones negotiation
business outreach
Identify target Economic impact
Program and Financial analysis Land lease
Design guidelines businesses/ and mission
design guidelines of proposal payments
sectors alignment
Identify
Financial
developers/ Evaluation criteria Reference checks Capital subsidy
feasibility
investors
Creditworthiness
Coordination of Development
and comparable Deal parameters Interviews
actors milestones
project experience
LOI/MOU/
Tenant
Business case development
commitments
agreements
Alignment with
Ground lease
design, program
agreements
guidelines

41
 Attracting and securing a high-quality university will entail
many special considerations.

Determine Marketing and

Determine Procurement
evaluation business
parameters process
criteria development
 Operating model  Local and international marketing to
 Vision senior decision makers
 Academic focus  Konza’s value proposition to universities
 Size – Land
 Brand – Capital and/or operating grants
 Investment and buildout plan – Urban environment
 Level of commercialization and R&D focus – Infrastructure
 Level of local partnership
 Relationships to local
Negotiate deal
business/stakeholders
terms
 Relationships within Africa
 Minimal land lease payments
 Capital subsidy
 Operating subsidy
 Phasing plan
 Development milestones

42
 KOTDA / MDP2 will rely on the flow of funds to pay for on-site
infrastructure, using project finance where needed.

Funding
MDP2
Design and
construction overview
Funding of some infrastructure

Funding
Project finance PPPs
GoK Debt KOTDA
Equity
Mezzanine Funding Municipal
Facilitator services

Private
Lease and service fees developers
Individual parcel
development
Taxes

43
 Residential land development will be the primary source
of land revenue to pay for non-PPP infrastructure.

Phase 1 Land Lease Revenues

$60,000,000

$50,000,000

$40,000,000

$30,000,000

$20,000,000

$10,000,000

$0
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
Office Lab High-end res Mid-end res Flex Retail Hotel

 25 year lease payment schedule.

44
 Infrastructure costs will be frontloaded in cash…

2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
$0

($20,000,000)

($40,000,000)

($60,000,000)

($80,000,000)

($100,000,000)

($120,000,000)

($140,000,000)

($160,000,000)

Non-PPP infrastructure expenditures

45
 …but can be smoothed using a central government
bond.

2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
$0

($20,000,000)

($40,000,000)

($60,000,000)

($80,000,000)

($100,000,000)

($120,000,000)

($140,000,000)

($160,000,000)

Non-PPP infrastructure expenditures Total bond payments

Assumes total infrastructure costs of $400 million, a 12.5% interest rate, and a 25 year central government
bond.

46
 For example a standard GO bond can help finance the
development; GoK will need to cover the funding gap.
Bond structure
$80,000,000
Bond term: 25 years
$70,000,000 2018 Yield to Maturity: 12.5%
funding gap Denomination: KSh
$60,000,000 $50M

$50,000,000 Standard
Bond
$40,000,000 Payments

$30,000,000 Land
Lease
$20,000,000 Revenues
$10,000,000

$0
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
Annual funding gap (millions)
2013 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037 2039 2041 2043

$0 ($23) ($43) ($49) ($45) ($44) ($42) ($38) ($32) ($26) ($22) ($16) ($10) $1 $32 $38

47
 Current market conditions provide the opportunity to
reduce financing costs using Eurobonds.
Bond structure
$80,000,000
Bond term: 25 years
$70,000,000 Yield to Maturity: 5.5%
Principal payment: USD
$60,000,000
2018 Eurobond
$50,000,000
funding gap Payments
$40,000,000 $28M
Land Lease
$30,000,000 Revenues

$20,000,000

$10,000,000

$0
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
Annual funding gap (millions)
2013 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037 2039 2041 2043

$0 ($13) ($24) ($26) ($22) ($21) ($20) ($16) ($10) ($4) ($1) $1 $3 $6 $9 $12

48
 A loan from a multilateral institution would help to
minimize the funding gap.
Bond structure Loan structure
$80,000,000
Bond term: 25 years Loan term: 30 years
$70,000,000 Yield to Maturity: 5.5% Interest rate: 2%
Principal payment: USD Moratorium: 10 years
$60,000,000
2033 funding gap Loan
$50,000,000 $11M Disbursements
2019 funding gap
$40,000,000 $11M Land Lease
Revenues
$30,000,000
Loan
$20,000,000 Payments
$10,000,000
Eurobond
$0 Payments
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
Annual funding gap (millions)
2013 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037 2039 2041 2043

$0 ($5) ($10) ($11) ($10) ($9) ($9) ($8) ($7) ($5) ($11) ($9) ($6) $0 $13 $7

49
 Several sources of financing are available to the GoK
for non-PPP investments.

Financing sources Interest costs

Low
 Donor agencies
 Multilateral institutions loans
 Multilateral institution guarantee
 Bilateral agreements
― China Development Bank
Government
 MNCs and developers
Funding
― General Electric
― Landmark
 International financial markets
― Eurobond
― Sovereign Bond

High

50
 Combing the Eurobond with a loan from a multilateral
institution is the preferred financial structure.

Multilateral Institution
Eurobond
Loan
Minimum gap to be
financed by other
Bond size: $400 million Loan amount: $225 million government revenues
Interest rate: 5.5% Interest rate: 2%
Term: 25 years Term: 30 years
Moratorium: 10 years

51
 Public investment in Phase 1 of Konza will have substantial
economic benefits.

$400M $180M
Non-PPP infrastructure: GoK PPP infrastructure:
public investment public share of investment

$940 M
Private investment

16,675 $1.3 billion $400M

Direct jobs Gross Regional Product Annual wages
at full Phase 1 build-out, assumed to be 2020
* Non-PPP and PPP infrastructure investment costs do not include off-site infrastructure.
* Public share assumed to be 50% of PPP costs.
* All figures are in 2012 dollars.

52
 Konza will contribute to Kenya’s economic output.

$1.3 B
Konza gross regional product (GRP)

2%
of Kenya GDP in 2020
7%
of Kenya GDP growth 2012-2020
8%
of Kenya wage growth 2012-2020
at full Phase 1 build-out, assumed to be 2020

* All figures are in 2012 dollars.

53
 Public investment in infrastructure has a return on
investment when considering GoK tax revenue.

-13%
Real IRR:
$580M land lease revenue
Non-PPP and PPP
infrastructure investments
by GOK +19%
Real IRR:
land lease revenue + taxes

* 50% of PPP investments assumed to be paid for by GoK.

* GoK tax revenues estimated to be equal to 20% of Konza GRP contribution.
* 50% of taxes assumed to be abated for first 10 years (2016-2025).
* All figures are in 2012 dollars.

54
 Public investment creates significant economic impacts.

$940M
Private investment

$580M 16,675
Non-PPP and PPP Direct jobs
infrastructure investments
by GOK
16,675
Multiplier jobs

Public investment per direct job: $35,000

Public investment per total job: $17,500

55
 Phase 1 will catalyze the buildout of Konza, leading to
broader economic impacts.

Konza
Konza
Phase
1

Phase 1 must create the enabling Beyond recouping of public

environment and establish the investment, the success of Konza
critical mass of jobs and services will be measured by its ability to
required to stimulate future meet broader economic
phases of Konza. development goals.

Key performance indicators for Konza

Job creation Global ICT leader Middle-income country
 Total jobs  ICT jobs  Total wages
 Total firms  ICT spend  Average wage
 Total SME firms  Patent applications  GDP growth rate
 Indirect/induced jobs  R&D spending  Per capita GDP
created outside Konza

56
 Short-term risk factors (0-3 months)

 LPDP must be approved.

− Must be consistent with planning principles of the Phase 1 plan.
 KOTDA Statute must be passed by Parliament.
− Existing KOTDA Order must be amended in the interim.
− Customized financial incentives must be approved.
 High-quality KOTDA staff must be hired.
− Salary ranges must be globally competitive.
− Detailed job descriptions and qualifications must be developed.
 Funding for site pavilion and other preliminary infrastructure must be secured.
 Procurement of site pavilion contractor
 A qualified MDP2 team must be contracted.
 Increased water allocation from Thwake Dam must be secured.
− Water sources to meet ~14.1 ML/day Phase 1 demand must be met through dam
allocation combined with reuse and conservation.

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 Medium-term risk factors (0-18 months)

 Off-site infrastructure must be provided.

− Funding must be secured.
− Construction must begin.
− Includes A109 upgrade, Thwake Dam construction and delivery network, etc.
 The procurement process for PPPs providing on-site infrastructure must be inititated.
− Business plans, rate studies, and procurement documents must be prepared.
− Includes water, wastewater, power, fiber, and solid waste.
 Non-PPP on-site infrastructure must be provided.
− Funding must be secured.
− Construction must begin.
− Includes grading, drainage, roads, and landscaping.
 Anchor tenants must be secured using defined evaluation criteria and recruitment strategies.
− University
− KARI and KEMRI
− Nairobi Hospital
− Other anchor tenants and private development.

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