Rental housing developer Acorn Holdings Limited together with Absa Group and Absa Bank Kenya, have announced the successful conclusion of a KES 6.7 Billion financing agreement to support the development of a further ten purpose-built student accommodation developments in Nairobi, Kenya.
Acorn will be developing the student accommodation housing units over the next 3 years, therefore adding another 12,000 beds to the Acorn Student Accommodation REITs, bringing the total bed portfolio to 21,000 beds.
Speaking at the same function, State Department for Investments Promotion Principal Secretary, Abubakar Hassan, encouraged greater participation of pension schemes for the affordable housing agenda to bolster funding for the initiative.
He said: “We have a roadmap to deepen the capital markets through responsive legal and regulatory measures. I would urge the pension schemes to also take part in this affordable housing agenda so that we can support the Government’s initiative to mobilize pension capital to support the housing agenda.”
“This Kes. 6.7 billion debt facility from Absa Bank is part of a Kes. 11 billion financing package that Acorn has put together to finance 12,000 new beds that are affordable, of high quality, and safe. The balance of the financing will come from Equity contributed through the Acorn Student Accommodation REITs which are providing a capital markets solution to finance housing in Kenya.” said Acorn Holdings Limited Founder and Chief Executive Officer, Edward Kirathe.
Absa Bank Kenya Chief Executive Officer, Yusuf Omari said:
“With a student housing deficit of at least 200,000 in Nairobi alone, the market is underserved. A D-REIT of this nature enables access to capital and an increased supply of purpose-built student accommodation while also providing amenities such as, high-speed internet, study and recreational common areas. Absa is committed to partnering on projects that help the youth of Africa to not only survive but thrive.”
Yusuf further explained that given the market demand fundamentals and the social importance related to housing on the African continent, Absa supports Acorn’s strategy to develop similar solutions in other cities and countries in Africa.
READ; Acorn Holdings’ REITS Post KSh1.16 Billion Net Profit in FY 2021
