Real estate developer Acorn Holdings has signed a USD 180mn (KShs. 23.6bn) financing deal with the US Development Finance Corporation (DFC) to develop 35 new affordable student housing units.
- The company will use the financing to secure over $380 million in Kenya Shilling and crowd over $315mn from capital markets.
- The total size of the deal will be $700mn over the 18-year life of the transaction.
- Half of the loan will be invested in the Acorn Student Accommodation Development-Real Estate Investment Trust (ASA DREIT).
“This amount will be recycled up to two times during the term of the loan, facilitating up to $270 million in financing,” Acorn Holdings said in a statement on Friday. “The remainder of the funds totaling $90 million will go towards the Acorn Student Accommodation Income-Real Estate Investment Trust (ASA-I-REIT) to finance the acquisition of stabilized Purpose-Built Student Accommodations from the DREIT.”
The financing deal involves MIDA Advisors as lead arranger and advisor, Stanbic Bank as joint lead arranger and lender, Prosper Africa, and USAID providing technical support. Once complete, it’ll more than triple the current 21, 000 beds in Acorn’s portfolio.
“By being Africa’s largest-ever deal of its kind, it asserts Acorn’s commitment to the development and provision of safe and affordable housing for students in Kenya,” Acorn Holdings CEO Edward Kirathe said.
