Centum eyes Rea Vipingo land for property business
What you need to know:
Analysts say Centum will use the Two Rivers Development coming up on a 100-acre plot in the Runda suburb in Nairobi as a blueprint for its land holdings in Uganda and Vipingo.
The Vipingo land is also ideal for Centum’s plan to invest in agriculture, one of the areas where it targeted to enter in the next five years.
The investment firm bought the 10,500 acres from Rea Vipingo earlier in the year for Sh2 billion as part of a truce halting a bidding war with the UK-based Robinow brothers, the majority owners of the sisal plantation.
Centum Investments is crafting a master plan for its recently acquired Rea Vipingo land at the Coast that could see some of the farmland converted into real estate.
The listed investment firm said while it is still too early to release finer details on the exact mix of projects it plans on the 10,500 acres, real estate is an option that is on the table.
“We are in the early stages of developing the master plan for the Vipingo land, so it is not possible at this time to say the exact use of the land. However, it is likely that some of the land will be set aside for real estate development and a large portion continues to be leased to Rea Vipingo Plantations Ltd for their sisal operations,” said Centum corporate affairs director Fred Murimi.
Research analysts at Standard Investment Bank, however, say that Centum will use the Two Rivers Development coming up on a 100-acre plot in the Runda suburb in Nairobi as a blueprint for its land holdings in Uganda and Vipingo.
“The model adopted will be replicated in other areas, specifically Pearl Marina (Uganda) and Vipingo (Industrial park) in Mombasa (100 to 200 acres of the 10,500 acres),” said a brief by Standard Investment Bank.
Centum is putting up the region’s largest shopping mall in the Two Rivers mixed development in addition to two hotels, office blocks and apartments and the Pearl Marina in Uganda is on course to replicate the development.
Pearl Marina is being constructed on 385 acres and is expected to open its doors in February 2017.
The Vipingo land is also ideal for Centum’s plan to invest in agriculture, one of the areas where it targeted to enter in the next five years.
An investor presentation on the firm’s Sh6 billion bond says Centum has agriculture deals in the pipeline.
Centum will invest in agriculture through greenfield projects and joint ventures and estimates indicate it will spend around $10 million (Sh970 million) over the next three years.
The investment firm bought the 10,500 acres from Rea Vipingo earlier in the year for Sh2 billion as part of a truce halting a bidding war with the UK-based Robinow brothers, the majority owners of the sisal plantation.
Centum also intends to invest in health, energy, financial services, ICT and fast moving consumer goods businesses.
The investment firm released its full-year results on Wednesday showing net profit went up by 160 per cent to stand at Sh7.9 billion for the year ended 31 December 2014, from Sh3 billion due to gains made on disposing of its stakes in UAP and appreciation of its property portfolio.
