CATEGORIES: Africa, Industry News, Private Equity, REITs & Funds

Growthpoint Investec African Properties debuts acquisition in Africa

Having commenced operations last year with capital commitments in excess of $212 million from several large institutional investors such as the IFC, Growthpoint Investec African Properties (GIAP) has successfully concluded the acquisition of 97.5% of Achimota Retail Centre.

Achimota Retail Centre located in Accra, Ghana is a single level mall which includes 15,000m² of retail space comprising of 51 line stores plus 250 basement parking bays and 335 open air parking bays. It was previously owned by AttAfrica, a joint venture of JSE-listed REITs, Attacq Limited and Hyprop Investments Limited, and other minority shareholders.

Growthpoint Investec African Properties debuts acquisition in Africa
Growthpoint Investec African Properties debuts acquisition in Africa

Growthpoint Investec African Properties is a joint venture between Growthpoint Properties and Investec Asset Management that was announced in 2015. The joint venture will seek to invest in income-producing commercial real estate assets in select cities across the African continent. Targeted investments will be further diversified by sector, with GIAP’s mandate spanning office, retail and industrial properties.

According to the press release from Growthpoint Properties, GIAP’s capital is expected to be fully invested in the current pipeline of assets under discussion by the end of 2019, and its investments further diversified across office, retail and industrial sectors. The second transaction is expected to be finalised within the next month, after which further details will be made available.

Thomas Reilly, MD of Growthpoint Investec African Properties Management, says:
“GIAP has strategically timed its entry into the market to take advantage of a highly attractive entry-point into key cities which we view as offering strong growth prospects. We have adopted a very considered asset acquisition strategy with the result of being able to source quality yielding assets at very competitive prices. The business is enjoying significant momentum at the moment, and we expect this to aid the delivery of sustainable long-term investor returns.”

The time noted between the announcement of the joint venture and the conclusion of its first transaction in July 2019 attests to the slow pace of the African real estate market. Another similar partnership which is yet to deploy capital is that between Old Mutual Investment Group (OIMG) and the Nigerian Sovereign Investment Authority (NSIA) that was formed in 2016 to invest $500 million in commercial, retail and hospitality assets. As key African economies begin to emerge from recession and as new investment destinations open up across the continent, we expect more investors to start deploying capital more aggressively.

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