Actis has entered into a partnership with Paragon Holdings Limited and Rand Merchant Bank of South Africa to build a world-class shopping mall in Ikeja, Lagos.
Actis and local partner Paragon Holdings who first sourced the development site, have been working for two years to make this idea a reality. Actis will become the 60% majority owner; Paragon Holdings and Rand Merchant Bank Investments & Advisory (‘RMBIA’) will each take 20% equity stakes in the project.
The commitment builds on Actis’s successful investments in Nigeria’s first modern style shopping mall, The Palms; as well as Junction Mall in Nairobi, and Accra Mall in Ghana.
The mall in Ikeja will be an international standard leisure and shopping centre with restaurants, a cinema and retail outlets. It has been designed to service the Lagos mainland and return Ikeja to its status as the traditional retail hub of the city. The project will initially develop 28,500m2 of leisure and retail shopping space; anchor tenants already secured include Shoprite and Silverbird Cinemas.
David Morley, Head of Real Estate at Actis said: “We are pleased to be the core investor in this project. The Palms Shopping Mall has become a benchmark for retail developments in West Africa and we want to replicate its success in Ikeja, in partnership with Paragon and RMBIA.”
Mr. Afolabi Toyo of Paragon Holdings said: “The Mall will bring social and economic development to the Ikeja area. There will be significant employment opportunities during the construction and operation phases, and we look forward to bringing this world-class real estate project to fruition.”
The project will be financed by a mixture of debt and equity, with a debt facility of US$48.6m secured from Stanbic IBTC Bank Plc and Standard Bank of South Africa Limited.
Michael Chu’di Ejekam, Actis Head of Real Estate in West Africa said: “We are grateful to the Lagos State Government and the State Governor His Excellency Babatunde Raji Fashola, who have shown great leadership and vision in their support of this project. Early on, they saw the potential of the mall and the positive impact it would bring to Lagos, in line with their overall strategy to develop world-class infrastructure and services.”
Actis’s Real Estate team in Africa combine private equity real estate, development and financial experience with a strong network and relationships with leading industry professionals, third party developers and lenders. The team catalyse developments in retail and leisure, A-grade office, affordable residential and limited service hotels, giving careful consideration to energy saving measures and green building practices. Their current portfolio includes investments in Nigeria, Tanzania, Kenya, Ghana and Mauritius.