Actis has closed its third opportunistic private real estate fund, Actis Africa Real Estate Fund 3 (ARE3) with commitments totalling more than $500m, exceeding its original $400m target. The fund has a diverse investor base, including pension funds, sovereign wealth funds, development finance institutions and endowments from Africa, Asia, Europe and North America. Fundraising for the fund was led by Actis with support from First Avenue.
ARE3 will invest predominantly in prime retail, office and industrial developments in the capital cities of 7 – 8 sub-Saharan African markets. Over the past decade, the team has invested in assets valued at $1.4 billion on a gross asset value basis in countries such as Ghana, Angola, Nigeria and more. In Nigeria, Actis developed The Palms Shopping Mall in Lagos, Ikeja City Mall in Lagos, Jabi Lake Mall in Abuja and Heritage Place in Lagos and have exited the first two. Find out more about the sale of Ikeja City Mall to South African investors from ei Sale Reports.
According to the Africa Prospects Indicators report released by Nielsen Africa earlier this year, Côte d’Ivoire overtook Nigeria’s leading position in terms of overall outlook for opportunities for existing and potential investors in Sub Saharan Africa. For the most part, countries in Francophone West Africa have received little capital from real estate private equity firms over the past decade. This is expected to change as investors, including Actis, should begin to allocate more towards these regions, especially since other country’s economies (namely Nigeria) have come under severe strain.
The Actis team is led by David Morley and includes two other partners, Amanda Jean-Baptiste and Louis Deppe and 11 other investment professionals across offices in London, Johannesburg, Nairobi and Lagos.
David Morley said:
“This successful fundraising is a further sign of confidence from our investors in our ability to identify the most compelling opportunities across Africa. With this new vehicle, they will satisfy part of the demand for institutional quality real estate in some of the fastest growing cities globally.”
ARE3 is the largest opportunistic private real estate fund targeting sub-Saharan Africa raised in the market to date and is significantly larger than Actis Africa Real Estate Fund 2, which closed in October 2012 with commitments of $278m. Earlier this year, Ashburton Investments raised an initial $250m for RMB Westport Real Estate Development Fund II. Eight of the company’s offshore and South African institutional clients backed the fund, which had a $450m target.