Cytonn CEO Edwin Dande with chief investment officer Elizabeth Nkukuu at a past function in Nairobi. PHOTO | FILE
What you need to know:
Cytonn Investments says it has now raised Sh2 billion up from Sh1.4 billion that was raised last month.
Cytonn Investments has bagged an extra Sh600 million through its debut privately placed bond for its real estate projects.
The firm said in a market report that it has now raised Sh2 billion up from Sh1.4 billion that was raised last month.
“Due to investor demand, Cytonn reopened its recently closed private placement of real estate-backed structured notes: the reopening took in an additional Sh600 million, which brings to Sh2 billion the total amount raised over the last one month,” said a market report by the firm.
The issue was sold to local, foreign and high net worth individuals and had an average interest rate of 16.5 per cent with a five-year tenor. The firm is developing residential units in the Karen suburb of Nairobi and Ruaka town of Kiambu County.
The real estate sector has been posting strong returns but recent data shows that the industry is starting to show signs of cooling off.
Data from the Kenya National Bureau of Statistics shows that growth of the construction sector over the first six months of the year decelerated from 16.6 per cent in 2014 to 9.9 per cent contributing significantly to the lower growth figures.
Property experts say they do not expect strong growth as the last few years.
A recent report by Knight Frank said that rents in prime residential, office and retail buildings have also stagnated for the first six months of the year.
Cytonn has also raised the funds when analysts expect companies to be more cautious of borrowing due to the rising interest rates.
African Alliance Investment Bank chief executive Alistair Gould said that companies are borrowing only if there is a compelling reason.
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