Somali pirates driving up Kenyan real estate prices

In addition to running their own stock exchange, it seems that Somali pirates might be getting into real estate in neighboring countries as well: Even as housing prices have dropped sharply in the United States, prices in Nairobi have seen two- and three-fold increases the last half decade. "There is suspicion that some of the ...

By , a former associate editor at Foreign Policy.

In addition to running their own stock exchange, it seems that Somali pirates might be getting into real estate in neighboring countries as well:

In addition to running their own stock exchange, it seems that Somali pirates might be getting into real estate in neighboring countries as well:

Even as housing prices have dropped sharply in the United States, prices in Nairobi have seen two- and three-fold increases the last half decade.

"There is suspicion that some of the money that is being collected in piracy is being laundered by purchase of property in several countries, this one being one of them," said government spokesman Alfred Mutua. "Especially at this time when we are facing global challenges of security such as terrorism and others, it is very important for us to know who is where and who owns what." […]

Pirates in Somalia say they invest their ransom money outside their war-torn country, including in Kenya. One pirate who gave his name as Osman Afrah said he bought three trucks that transport goods across East Africa. A second pirate, who only gave his name as Abdulle, said he’s investing in Kenya in preparation for leaving the pirate trade.

"Pirates have money not only in Nairobi but also other places like Dubai, Djibouti and others," said Abdulle. "I have invested through my brother, who is representing me, in Nairobi. He’s got a big shop that sells clothes and general merchandise, so my future lies there, not in the piracy industry."

My colleague Elizabeth Dickinson has argued that pirates’ financing is the achilles heel, and by investing in highly visible sectors like real estate, they seem to be sticking that heel pretty far out. Also, the fact that the AP’s Tom Odula was able to get not one, but two pirates to tell him about their investment strategies, suggests that these guys might be getting a little overconfident.

Hat tip: Marginal Revolution

Joshua Keating was an associate editor at Foreign Policy. Twitter: @joshuakeating

More from Foreign Policy

Newspapers in Tehran feature on their front page news about the China-brokered deal between Iran and Saudi Arabia to restore ties, signed in Beijing the previous day, on March, 11 2023.
Newspapers in Tehran feature on their front page news about the China-brokered deal between Iran and Saudi Arabia to restore ties, signed in Beijing the previous day, on March, 11 2023.

Saudi-Iranian Détente Is a Wake-Up Call for America

The peace plan is a big deal—and it’s no accident that China brokered it.

Austin and Gallant stand at podiums side by side next to each others' national flags.
Austin and Gallant stand at podiums side by side next to each others' national flags.

The U.S.-Israel Relationship No Longer Makes Sense

If Israel and its supporters want the country to continue receiving U.S. largesse, they will need to come up with a new narrative.

Russian President Vladimir Putin lays flowers at the Moscow Kremlin Wall in the Alexander Garden during an event marking Defender of the Fatherland Day in Moscow.
Russian President Vladimir Putin lays flowers at the Moscow Kremlin Wall in the Alexander Garden during an event marking Defender of the Fatherland Day in Moscow.

Putin Is Trapped in the Sunk-Cost Fallacy of War

Moscow is grasping for meaning in a meaningless invasion.

An Iranian man holds a newspaper reporting the China-brokered deal between Iran and Saudi Arabia to restore ties, in Tehran on March 11.
An Iranian man holds a newspaper reporting the China-brokered deal between Iran and Saudi Arabia to restore ties, in Tehran on March 11.

How China’s Saudi-Iran Deal Can Serve U.S. Interests

And why there’s less to Beijing’s diplomatic breakthrough than meets the eye.