Markets & Finance

Centum cedes 42pc of Two Rivers venture to investors at Sh6bn


Centum’ CEO James Mworia. Photo/FILE

Centum Investments has ceded 42 per cent shareholding of its Two Rivers real estate project to two investors.

The investment firm said it had received Sh6 billion for the stake, which values the project at Sh15 billion. Centum’s management failed to name the investors, but disclosed that one was a local and the other an international player. The investors put in $70 million (Sh6.02 billion) and $5 million (Sh430 million) respectively.

Centum has also received a Sh5 billion 10-year debt from Co-operative Bank to build the Two Rivers Mall which is the anchor property of the development expected to open in October next year.

“This transaction will value Centum’s stake in Two Rivers at Sh9 billion and values Two Rivers at Sh15.1 billion as the post-money valuation,” said Centum’s chief executive James Mworia.

Mr Mworia said that the investment firm now had enough cash to complete the first phase of the project which includes construction of the mall and infrastructure.

The firm has built an overpass and underpass leading to the entry of the development and has also put an interchange to ensure ease of traffic flow to the estate.

Mr Mworia said 50 per cent of the mall had already been pre-let and a further 20 per cent was in the final negotiations.

The mall’s anchor tenant will be Carrefour, the 4th largest retail group in the world. The retail chain is owned by Dubai based Al- futtaim Family which acquired CMC Motors recently.

READ: Centum's profit rises, flagship mall progresses

Centum plans to issue a development REIT (real estate investment trust) to help complete the ambitious project. The project includes a five star and three star hotels, a hospital, residential and office space. Two Rivers is set on a 102 acre piece of land next to Runda, Nairobi.

Undergoing approval

The development REIT is currently undergoing approval by Capital Markets Authority. The REIT allows investors to buy a stake in the project before its completion and earn rental income or capital gains upon it being put into the market.

Centum also announced it had partnered with Broll Properties Group to set up the Broll’s East African operation. Centum has 30 per cent shareholding in the joint venture, which gives it control in the management of the property and sourcing of clients.

On Monday, Centum also started a search of construction companies to develop its Pearl Marina estate in Uganda.

Construction work at the project is expected to start in August with pre-sales beginning in September. The project comprises of apartments, villas, marinas, a hospital, school, offices and recreational facilities.

Pearl Marina is set on a 361 acre piece of land along Lake Victoria. Centum acquired an additional 40 acres for the project last year, with management disclosing that it was sourcing for more land.