In its financial statement for the period ending June 2021, Resilient Africa made public their intention to dispose of their Nigerian retail portfolio to their joint venture partner, Shoprite Holdings Limited (SA).  

Resilient Africa is a property development and investment company that was established by Resilient REIT Limited, a popular South African Retail Real Estate Investment Trust (REIT), in partnership with Shoprite Holdings Limited, the African grocer and food retailer. The aim of the partnership was to develop quality shopping malls in selected dominant metropolitan areas throughout Nigeria. So far, their Nigerian portfolio covers up to 30,015sqm of lettable retail space in three malls including Delta Mall, Asaba Mall and Owerri Mall.

Delta Mall has a gross lettable area of 13,363sqm and was completed in 2016.

Owerri Mall has a gross lettable area of 8,686sqm and was completed in 2016.

Asaba Mall has a gross lettable area of 8,002sqm and was completed in 2016.

According to this year’s integrated annual report, the Board resolved to dispose of all Resilient’s operations in Nigeria. Those operations are held through a 60.94% interest in two South African incorporated companies, Resilient Africa and Resilient Africa Managers, in partnership with Shoprite Holdings Limited. At the reporting date, an in-principle agreement had been reached to dispose of the portfolio/operations and consequently, their subsidiaries shown above are now being carried as discontinued operations (Non-Current Assets Held for Sale and Discontinued Operations). As of June 2021, the purchase consideration had not yet been agreed upon.

In 2015, we highlighted Resilient’s ambitious plan to invest $271m in malls in 2nd tier cities. This changed during 2016, when the company’s MD at the time, Des de Beer, presented a bleak outlook for the country’s retail market during that year’s annual results presentation. He stated that the risks were now outweighing returns, and have led them to reduce their exposure to future projects and a reduction in the size of its Owerri Mall and Asaba Mall, both under construction with initial plans of 13,000sqm each. 

For the avoidance of doubt, Shoprite Holdings is the larger South African Holdco, not the Nigerian entity that was recently sold to Ketron Investment Limited. What are your thoughts on the evolution of African private equity real estate funds and Nigerian retail developers? Follow us on Linkedin and let us know what you think!